Cyprus Mail
Business

University unfazed by Bitcoin warnings

By Constantinos Psillides

THE University of Nicosia, the first private university in the world to accept Bitcoin as payment for tuition, is determined to move forward with embracing the digital currency, despite a plunge in value over the week.

Dr Christos Vlachos, chief financial officer for University of Nicosia, said at a presentation yesterday that Bitcoin was an inevitability that would eventually lead to significant innovation. “Digital currency will create more efficient services and will serve as a mechanism for spreading financial services to under-banked regions of the world. In this light, we consider it appropriate that we implement digital currency as a method of payment across all our institutions in all cities and countries of our operations,” he said.

Vlachos, who was interviewed last week on “Keiser Report”, on the TV network Russia Today, said that he hoped to turn Cyprus into a Bitcoin hub.

Bitcoin is a peer-to-peer digital currency that functions without a central authority and it was first introduced in January 2009 by a person known only as Satoshi Nakatomo.

The digital currency is stored in anonymous ‘electronic wallets, or code, and can travel from one wallet to another by means of an online peer-to-peer network transaction.

The digital currency took a severe hit the past week, after China’s Central Bank (CBC) issued a warning against it and banned deposits in yuan on BTC China, the biggest Bitcoin trading platform.

Warnings against trading in Bitcoin were also issued by the European Banking Authority on December 12. The EBA warned Europeans that they should be fully aware of the risks entailed in trading in Bitcoin before deciding to do so, adding that “no specific regulatory protections exist that would cover you for losses if a platform that exchanges or holds your virtual currencies fails or goes out of business”.

The Cyprus Central Bank also had something to say about Bitcoin. In a statement given to the Cyprus News Agency, the CCB made clear that “using any virtual money is extremely dangerous because they are not monitored by any authority, thus operating without control”.

The accusations were contested by Danny Brewster, CEO of Neo & Bee, the largest business in the world that is building infrastructure around Bitcoin technology.

In a written statement, Brewster argued that “the use of Bitcoin carries risks like any other financial instrument. However, because Bitcoin is still only five years old, the infrastructure is still being developed,” said Brewster. “Bitcoins have value because they are useful, they can travel immediately and they cannot be reproduced by fiat, by anyone. I sincerely wish such transparent and free protocols were available by voluntary consensus to everyone.”

Despite the plunge in value, University of Nicosia’s decision to accept Bitcoin as legal tender was met with widespread coverage.

During yesterday’s presentation, Vlachos boasted worldwide coverage from 242 media outlets, including the Wall Street Journal, Bloomberg Business, Los Angeles Times and Time magazine.

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