Bitcoin is reaching record valuations and many investors, individuals and professionals, want to take their share. This currency, which is not really one, arouses covetousness, but the investment is not without risk. Valuation, control, position of Europe… Novethic deciphers in five questions what you need to know about these crypto-assets.

How much is a bitcoin worth?

Over $40,000! This is the record valuation reached by bitcoin at the beginning of January, before falling and stabilizing around $30,000. Over the year 2020, the price of bitcoin has quadrupled, enough to attract many investors, both professional and individual. This digital currency, however, is characterized by high volatility, so much so that market regulators point out the risks for investors. "If consumers invest in this type of product, they must be ready to lose all their money," warned the Financial Conduct Authority, the British market watchdog, in early January.

Why bitcoin is controversial?

The possibility of anonymity for its holders does not only attract investors in search of returns. Bitcoin is often suspected of being used for illegal operations, even if it has become much more popular today. Another criticism: this cryptocurrency is not really a currency, because it does not come from a sovereign state. Coining money is normally part of the sovereign powers attached to a State, bitcoin is on the contrary a purely private asset. This is precisely what FaceBook was accused of when the American social network wanted to create Libra.

Who regulates bitcoin?

Currencies are generally regulated by central banks. For bitcoin, there is no large central authority to regulate monetary creation, everything is controlled in a decentralized way by the Blockchain, this technology which underlies cryptocurrencies. It is a network made up of storage nodes, on which users send information or a transaction in the form of a block. Each node records and validates the block of information, which becomes registered in the blockchain and is deemed unfalsifiable, the information being stored in all these multiple nodes. No central authority therefore comes to regulate and guarantee the currency.

Are there other cryptocurrencies?

Bitcoin is just one of the existing cryptocurrencies, based on one of the existing blockchains (called… Bitcoin, with a capital letter). Many others exist, without however having ever achieved the notoriety and the valuation of bitcoin. This is the case of ethereum, another well-known cryptoasset. "Stablecoins" are also cryptocurrencies whose particularity is to want to replicate a real currency. This is the case of Facebook's "libra" project, which consists of a stablecoin based on a basket of currencies.

What is Europe's position on cryptocurrencies?

The European Central Bank (ECB), like other central banks around the world, launched studies last October on the possibility of issuing a digital euro, in addition to issuing banknotes. This project is a direct response to the multiplication of private currencies and, in particular, to the Facebook project, and aims to ensure that the euro is not overwhelmed by these unregulated crypto-assets. This digital euro would be based on a blockchain, which would speed up exchanges while ensuring their reliability. The ECB cites as an advantage the fact, during a natural disaster, of being able to continue to operate. It is not a crypto-asset, however, warns the ECB. Its digital euro would remain guaranteed and controlled by the central bank.