Thursday, May 9, 2013

What is a Casascius coin?

A Casascius coin is the name of a certain type of physical – rather than purely digital — bitcoin. Mike Caldwell, a resident of Sandy, Utah, in the US, first introduced physical bitcoins for purchase in 2011. He coined the name “Casascius” from an acronym for “call a spade a spade.” Caldwell posts updates about his coins on the blog, “Casascius: You asked for change, I gave you coins.”

How does a Casascius work?

Each coin holds the key to the digital value assigned to a particular bitcoin account.
Though the coins are designed to reflect the relative worth of an account, they’re actually just secure containers for the digital information that unlocks the bitcoin’s value. The eight-character code on the outside of the coin corresponds to the first eight characters of an individual bitcoin address, which is assigned specifically to that coin. The individual bitcoin account’s “private key” is embedded on a card inside each coin.

The digital bitcoin, of course, is located online, found in the public “block chain” that records every bitcoin transaction on the internet. The digital coin connected to each Casascius is accessible only to the person who has the private key from the physical coin.
To spend a Casascius, the owner uses the code embedded into it to access the digital bitcoin online. The private key code can be imported directly into bitcoin clients or exchanges like Armory, or Mt. Gox to deposit funds. Read more here:

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Creator of Casascius Coins: Dr. Ron Paul, Bitcoins really do fit in your pocket! May I explain?

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