Bitcoin needs infrastructure
Besides mounting enthusiasm for Bitcoin and other crypto currencies, momentum is gathering to develop the infrastructure needed to turn what some see as a technology into a universally accepted currency, writes Dick Pirozzolo.
The Massachusetts Institute of Technology (MIT) is doing its part to help the process along. “We are giving $100 dollars of Bitcoin to every undergraduate, creating a [crypto currency] environment just to see what happens when Bitcoin becomes part of an on-campus medium of exchange,” noted Dan Elitzer, financial director, MIT Bitcoin project and one of its biggest proponents, during yesterday’s Standards Forum session on crypto currencies. He asked: “What is money? What is Bitcoin? Answering those questions got me interested and got me fascinated with the way a group of computers can agree to agree on a ledger over something that had occurred.”
To sceptics, one of whom likened Bitcoin to barter, Elitzer responded: “At what point does that become money? Is it when 100 people or 1000 people accept it? It’s money when people accept it for value. If you are willing to accept it, why is it not money?”
He further emphasised that even though we do not fully understand SMTP or the world monetary system, we still use email and money.
The founder and president of Etherium Stiflung Vitalik Buterin, created his non-profit organisation in Switzerland to expand the block chain concept on which crypto currencies rely to an infinite number of tradable assets. He has already raised $18 million to support the venture by trading Etherium tokens for investor dollars.
Although crypto currencies appeal to “libertarians” who like a currency that is apart from government, the bulk of experts at this and other Sibos sessions maintained that crypto currencies need government standards and formal exchanges to win broad acceptance.