Those who follow high tech news have already heard of bitcoins, a new form of “virtual” currency.
I’m not even going to pretend I get it. The whole idea sounds like a quasi-Ponzi scheme to me. Or some variation of the great Tulip bubble from centuries past. Sort of.
On the other hand, with the disappearance of the gold standard and very few coins having anything to do with precious metals anymore, are bitcoins really so different from any national currency? It can be argued that both are based on little more than fragile faith, to an alarming degree.
By way of keeping up with modern trends, I bring you bitcoin updates from up North. Canada, it would appear, is ready to try them out for a ride. Consider this item from Oct 2013:
…the world saw the first Bitcoin automated teller machine go live in a downtown Vancouver coffee shop, allowing people to exchange Canadian cash for the digital currency at a current rate of $211.79 per Bitcoin.
New users set up a digital wallet by scanning their palm on the machine, while others who already have a Bitcoin wallet select how much money they want to spend, insert the cash, and scan a complex square bar code on their phone to have the Bitcoins transferred to their wallet.
Not to be left behind, earlier this week the Ottawa Citizen reported that:
…on Thursday, Ottawa will join Toronto, Vancouver and Montreal as municipalities that have Bitcoin dispensing machines. The machine will be run by crypto-currency firm BIT-Capital.com and will be housed in the Clocktower Brew Pub on Clarence Street in the ByWard Market.
The article goes on to offer a primer on bitcoins with cautions that this is a new and unregulated form of currency, meaning “the risks are huge.” This CBC coverage on the same launch includes a video.
To paraphrase a quip from Dale Hobson: a totally abstract currency, being traded in a pub – what can go wrong?
Without a doubt, there will be bumps, scams and scandals along the path of any new monetary system. Then again, the same can certainly be said for conventional banking and regulators these days.
Are bitcoins the dawn of something new and powerful? Just another way to exploit greed and fleece the gullible?
We’ll find out, I guess. I prefer the sidelines while all that gets sorted out!