I love Friday nights at our house! We never know exactly who will show up or what paths the conversation will take, but it is always interesting. Last night, one of the subjects was bitcoins.
There were about a dozen of us in the room and our ages spanned two or three decades. Our knowledge about bitcoins went from zip (that would be me) to one of our guests who said that he’s been collecting them.
“Isn’t a bitcoin something virtual?” someone asked. The answer to that was, “Yes, of course,” followed (quite logically, I thought) by the question, “Then how can you collect them?” And from that point the conversation entered the Alice-in-Wonderland realm for some us — perhaps more appropriately called a “parallel universe” in today’s world. I only understood bits and pieces of what was being explained and felt quite relieved that there were people of like mind (and even younger than I) in the room.
I did (sort of) understand that bitcoin is a way to get traditional banking and government entities out of the currency biz. Given recent world financial problems, I think I’m probably in favor of that goal, although I tended to agree with the guest who said, “I think I’d rather stick to the gold standard and put my sock-full of coins under my mattress.”
The conversation segued into a discussion of money-laundering (apparently bitcoins are useful in that regard) and how the new prospects in our state concerning marijuana as a growth (ahem!) industry might be affected. There was lots of laughing, head shaking, and mind-bending (for me) commentary.
So, when everyone had left and I had a moment, I looked up bitcoin on Wikipedia. This is what it said:
Bitcoin is an open source, peer-to-peer network and digital currency introduced in 2009 by pseudonymous developer “Satoshi Nakamoto.” Bit coin has been called a crytocurrency because it uses public-key cryptography for security. Users send payments by broadcasting digitally signed messages that transfer ownership of bitcoins, the unit of currency, A decentralized network of specialized computers verifies and timestamps all transactions using a proof-of-work system. The operators of these computers, known as “miners,” are rewarded with transaction fees and newly minted bitcoins.
Needless to say, the explanation didn’t help. Heck, I don’t even understand how PayPal works…
Bitcoins were introduced to us at a regular meeting of our Sonoma County chapter of Veterans For Peace by a young female Associate Member (non-veteran) who is always hawking something in the nature of anti-government advice since she identifies herself variously as Libertarian or Anarchist. I don’t believe her intent is to be a criminal, but since Libertarians don’t like paying taxes that might benefit others, Bitcoins can be a way out. I believe her interest in the VFP–which is usually quite politically progressive–is for the purpose of discouraging the spending of tax dollars on war, which may or not be of benefit to the rest of us, depending …
Some of those subjects — political and taxing implications — came up in our discussion, too. There was a huge discrepency in people’s understanding and in their acceptance level of bitcoins. Some folks blew them off as a total scam; others thought that they could be a powerful tool in geting big business out of politics. And some of us were just stuck trying to figure out how you can put a value on a virtual currency. I wish you’d been here to add your voice!
Oh my gosh Sydney it blows my mind trying to figure out from Wikipedia’s explanation just what this all is! Sometimes I feel that I’m living in the wrong century!
It might make you feel better to know that my brain hurts now.
Additional note: I understand it is possible with bitcoins to lose your ‘virtual shirt’ or regain it overnight with new ‘buttons’ (bitcoins) as their value can fluctuate wildly. Not for the faint of heart. We have a huge new casino in our town — wonder if they would work there by pressing the right buttons? But I also believe that each party to a transaction must agree to acceptance or there is no deal, so not useful at the Oysterville Store . I’ll stick to pressing my real shirts!
Sounds like something out of Jules Verne!