Firm converts bitcoin into physical currency

An Isle of Man-based company has launched a service allowing UK customers to buy physical bitcoins

An Isle of Man-based company has launched a service allowing UK customers to buy physical bitcoins.

TGBEX Limited, a bitcoin exchange, produces limited edition physical bitcoins to represent the cryptocurrency.

Each physical coin is engraved with a key representing the bitcoin value. The key is generated using private offline keys, which are destroyed after the coin has been engraved using a computer-aided engineering process to reduce human error. The code is then covered with a holographic sticker.

The currency can then be converted back into online credit with the use of Blockchain.info wallet service, a website that logs and provides data on recent Bitcoin transactions. The cryptocurrency can then be spent online wherever bitcoin is accepted.

Co-founder of TGBEX, Adrian Forbes, said: “We have seen interest in the coins from people aged 18 to people over 60 and have been overwhelmed by the response and interest so far, so hope to build on this.”

The aim of investing in physical bitcoins is to reduce risk, as Bitcoins are stored offline as opposed to with an online bitcoin exchange.

Forbes said: “We hope to use our experience, together with assistance from our partners, to launch across the world. But we need to perform an analysis of what local regulations apply in each country we hope to sell in first, so are focussed on launching in the UK for the time being.”

The popularity of virtual currencies is increasing. Earlier this month, an MIT professor and his student wrote a paper describing the use of an algorithm to predict the fluctuating price of bitcoin, which can then be used to make appropriate investments.

Although many are reluctant to incorporate bitcoin into payments systems due to difficulty regulating the system, Mark Ridley from Reed.co.uk explained how the recruitment company implemented bitcoin into its payment system using agile methodologies.

Ridley explained: "It might not be that bitcoin is the actual currency that wins out in the long run, but certainly as a proof of the theory behind that type of currency, it is incredibly powerful.”

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