[Re: We need new digital currencies to shake up the status quo, yesterday]
Bitcoin isn’t a currency, it’s a vehicle for speculation. It started off as a libertarian project – with a vision to revolutionise both the way we transact and the way we view money. But it’s now a bubble waiting to burst. First, the value of all the Bitcoins in the world has exploded. It’s now surpassed $1bn, and that surely can’t last. But more importantly, value seems peculiarly sensitive to media coverage. Back in July 2010, when the website Slashdot published a piece on Bitcoins, the price shot up 10 fold. And it keeps happening, with the last few weeks a case in point. Perhaps this will be self-fulfilling – a rise in value prompts more media coverage, then more people want Bitcoins, and the value goes up ever further. But surely a time will come when coverage either becomes saturated, or it tails off, and the bubble bursts. What this means is that Bitcoin has little chance of establishing itself as a legitimate currency. It’s original intentions have been subverted by speculators.
Only a certain type of person will ever be comfortable using Bitcoins. First, it may be safe but people don’t understand the computer systems underpinning this safety. Secondly, the places you can spend Bitcoins don’t seem all that legitimate. Thirdly, trust in paper money hasn’t collapsed.
BEST OF TWITTER
It’s worth remembering that Kim Jong Un was educated in Switzerland. He knows the lies required to enslave North Koreans.
Bank of Japan delivers aggressive monetary easing, sets two years to achieve 2 per cent inflation. They are serious! Yen selling off.
It’s painful to watch. Cypriot government: economy “may” shrink by 13 per cent this year. Troika estimated around 8 per cent.
The UK economy is performing extremely well, having not grown at all over the last nine quarters, excluding the Olympics.