Recently there has been news about a man selling a physical Bitcoin on eBay for $99,000! Why is this physical Bitcoin worth so much? Well, this was a Casascius Bitcoin which has significant historical importance.
Each Coin has its own Bitcoin address and a redeemable “private key” which is covered by a hologram. To read the private key inside the coin the person need to peel the hologram, once peeled and redeemed the coin will no longer have any Bitcoin value. These coins are designed for face-to-face transactions.
A Casascius 25 BTC coin
Source: en.bitcoin.it
Redeemed Casascius coin
Source: en.bitcoin.it
Background
When I introduced Casascius Physical Bitcoins, part of the motivation was to introduce a proof of concept, a conversation piece to help people talk to others about Bitcoin and perhaps to be the first to market to make a real “coin” out of Bitcoins – something I perceive as being of historical significance given my enthusiasm for the project. What I didn’t expect in the beginning, is that a large part of the interest in Casascius Physical Bitcoins is from people wanting to collect the coin, who see it as a token of the same historical significance I see. Mike Caldwell mentioned on his website.
How does the Casascius Physical Bitcoins work?
Each coin consists of a private key and Bitcoin address. The private key is inside the coin which is protected by a tamper-proof hologram. If the hologram is intact, the coin is good. The hologram leaves behind a honeycomb pattern if it is peeled.
The 8 character code that can be seen outside of the coin is the first 8 character of the Bitcoin address which has been assigned to the coin. The digital bitcoin is located on the public “blockchain” stored on the internet, and can only be accessed by loading the private key into a Bitcoin wallet. To recover the digital bitcoins, the Bitcoin holder needs to find the private key and can be claimed from the peer-to-peer network. For example, one can enter (or “import”) coin’s private key code directly into Bitcoin clients such as Armory, Blockchain.info as a deposit method. The coin’s balance can be verified on Block Explorer.
Types of Casascius Physical Bitcoins
(Source: en.bitcoin.it)
The initial success of the 1 BTC Coins inspired Mike to create physical bitcoins of other denominations
Original series 1 BTC coin
Second series 1 BTC coin
10 BTC silver round
25 BTC coin
100 BTC gold plated bar
1000 BTC gold plated bar
1000 BTC 1 troy ounce gold coin
Suspension of sale
The Financial Crimes Enforcement Network (FinCEN), a branch of the Treasury Department, informed Casascius that minting physical coin and transmitting money requires state license and federal level registration. And thus from Nov 27, 2013, onwards, the sale is suspended for items that contain digital bitcoins, the current items in the sale does not contain bitcoins.
Fake Casascius Coins
There have been multiple reports of fake Casascius coins being circulated in the market. The counterfeit and unauthorized coins even appear to mimic the spelling error from the Series 1 coins. Check out this bitcointalk link where the author compares an original Casascius coin with a fake one.
One should not accept Casascius Bitcoins if the hologram is damaged because the integrity of the coin depends upon the hidden embedded key code inside the hologram.
The current status of Casascius coins:
Not all Casascius coins are opened till now:
As per Casascius Uberbills, below is the current status of the Casascius coins
Similar to Bitcoin Pizza, Casascius Coins are an important part of the history of digital currencies and needs to be treasured.
We have also elaborated another part of Bitcoin’s history, the Bitcoin Pizza. Read our article Buying Pizza with my Bitcoin: Then and Now
Disclaimer:
This article is not financial advice. Purchase Casascius Coins at your own risk. Beware of fake and counterfeits. Buy from trusted sources.
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