News RoundUp – May 7 2013


Here is some of the most recent Bitcoin news gleaned from various points of the internet:

In New York, a condo in the Trump SoHo luxury hotel is being offered for 1.9 million bitcoin. No other currency accepted. The sale is being made over Bit Premier, a luxury bitcoin exchange. After a quick look at their goods, it seems that there really are some bitcoiners with coin to spare.

A quick stop at Ebay reveals that bitcoins are being sold by the tenth, quarter, and half for some fairly extreme markups over the Mt. Gox price.

In related news, an article in the Wall Street Journal details one trick hackers use to scam the markets. They wait until an exchange like Mt. Gox has reached a suitably high price, then they sell and attack the exchange denying service and causing a panic. When the price has dropped, they can waltz in and use their cash to buy up bitcoins cheap. Something to bewaryof.

There are also reports that on Monday a number of people gathered together in Union Square in Manhattan to buy and sell bitcoins the old fashioned way, hand-to-hand. Real cash for real bits.

Which bring me to another interesting article arguing about whether Bitcoin isactuallya money or not. Max Keiser writes for the Huffington Postthat Aristotle defined money as having four essential qualities; It must be durable, fungible, portable, and have inherent value beyond its use as currency. Keiser states that Bitcoin meets all of these criteria, but that it is the last one, inherent value, that gets most people concerned. His claim is that although Bitcoin has no physical component, its value is the privacy it provides. In a world in which, due to the same technology that gave rise to Bitcoin, is increasingly surveilled, Bitcoin returns somesemblanceof privacy to the people. I would argue that Bitcoin gives more than that. Bitcoin provides a way of moving money without the fees and restrictions of sticky-fingered middlemen. I don’t see national currenciesdisappearinganytime soon, but Bitcoin may become the de facto international currency within a much shorter time than anyone now would think.

On the other side of that coin, Bart Chilton of the Commodity Futures Trading Commission has asked staffers to explore what regulations might be needed to protect consumers from nefarious bitcoin scam artists. Chilton claims that Bitcoin may fall under his jurisdiction due to the fact that it does not have any physical form and thus cannot really be called a currency (see above). I’m not completely anti-regulation, but before looking at this puddle, they should take a look at the tsunami that happened a few years ago and see what scam artists are still practicing their art after crashing the economy.

Finally, on the upside, according to the Wall Street Journal (same article as above), Angel Investors and Venture Capitalists have started to invest in Bitcoin start ups. They list a number of companies, including Coinbase Inc. and Coinsetter Inc. that have raised millions. Fred Wilson, managing partner of Union Square is quoted as saying that “This is going to be the trigger point.”

We hope so!

Mt. Gox rate at the time of this post: 113.000

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