Dubbed as "Gold 2.0" and "cryptocurrency," Bitcoin is a consensus network that enables a new payment system and is completely digital in nature. It is the first decentralized peer-to-peer payment network that is powered by its users with no central authority or middlemen. From a user perspective, Bitcoin is pretty much like cash for the Internet.
Because of the low transaction fees involved with Bitcoins, Avish Bhama and Sean Lavine, founders of U.S.-based Bitcoin exchange BitMe, deemed it proper to create the Philippines Typhoon Relief Bitcoin Wallet to collect donations for the Philippine Red Cross.
Bhama and Lavine said in a note to fellow Bitcoin adopters that they wanted to change the "erroneous" perception that the virtual currency is "only used for facilitating illegal activity."
Both developers said they came up with the idea to create a special wallet Tuesday night (12 November 2013) after reading a news article about Typhoon Haiyan and the devastation it's caused.
So far, their wallet has about half a bitcoin, which is worth a little more than US$ 200 at current prices. Both Bhama and Lavine have donated, and said a few of their friends have.
"All things start small, but give us time and I think we'll be able to grow our efforts, especially through the holiday season," said Bhama. "This is just something we came up with last night, but it's about bitcoiners being able to help with a very tragic situation. And the bitcoin community is a powerful one."
Bhama said he doesn't have a specific goal in mind but expects the wallet will be able to raise a "meaningful amount." This will be later into U.S. dollars before it is sent to the Philippine Red Cross.
Canadian startup Coinkite, a Bitcoin banking service, is also collecting Bitcoin donations for the Canadian Red Cross for Philippine typhoon victims. So far, the company has raised 4.7 Bitcoins, or a little over US$ 2,000.