Virgin bitcoins are more valuable

Not all bitcoins are worth the same: in fact, some of them, called “virgin bitcoins”, are more valuable. 

These are BTC that have a clean transaction history or have none at all since they have been mined and not used yet. 

Their value on the market is greater because these are BTC that have never been involved in operations that have fallen under the monitoring of the supervisory authorities. 

Indeed, each individual Satoshi (one hundred millionth of a bitcoin) can be used to track the entire history of all transactions in which it has been involved since its creation. 

Bitcoin’s blockchain is public, so no matter how long and difficult it may be, it’s always possible for anyone to track all the transactions in which every single Satoshi has been involved, since the creation of Bitcoin’s blockchain on January 3rd, 2009. 

Some of these BTC have been involved in operations that ended up under observation by the monetary or tax control authorities because they were used for illegal activities or stolen during some hacks. 

Others, on the other hand, have never been involved with these activities. Therefore, they are defined as “virgins”, because they are pure and have a greater value since they are scarce and in high demand. 

This category includes those that have been mined and never used. In other words, they are, and have always been, on the addresses of the miners who have extracted them, and hence have not been involved in any transaction. 

However, there are also others that are clean despite the fact that they have sometimes been used in some transactions. The value of virgin bitcoins tends to be higher than that of unclean BTC, which circulate in large numbers on the market, by a percentage between 10% and 30%. 

In fact, unclean bitcoins are not necessarily dirty, i.e. they may not have been involved in illegal transactions in the past, but it is not certain that they are clean, therefore they are not considered virgin and have a common market value.

The concern is that they may somehow be confiscated or retained by the authorities if they are deposited at an address managed by a regulated intermediary. 

In addition, the regulated intermediaries themselves may refuse to accept BTC of dubious origin, and therefore have restrictions in place which result in a specific market demand for virgin bitcoins. 

According to Flex Yang, CEO of Babel Finance, the G20 summit held in June 2019 raised a number of concerns, in particular regarding the issuance of new Financial Action Task Force (FATF) regulations on cryptocurrencies. 

Fear of these regulations, according to Yang, is the main cause of the market demand for virgin BTC which has generated the increase in their value. 

According to investment advisor Jeff Horowitz, they could also encourage more and more people to conduct one-on-one transactions, without relying on intermediaries or using decentralised platforms.