No matter how many years of technology experience or how much effort to maintain knowledge of technology concepts and events … I continue to be reminded that technology changes so quickly and some items fly under my radar.
When I first read about Bitcoin a few months ago, I said “How did I miss this?”. In late 2013, it seems that almost overnight Bitcoin was the focus of so many articles and news releases. I found myself a bit confused and yet thinking why is this catching on? It is easy to understand why mobile payments, escrow payment services (PayPal), online banking and NFC (near field communication) technology are building adoption and popularity with consumers and businesses. However, a new currency?
I know that our society, especially younger consumers, have heavily adopted a “cashless” mentality to pay for daily activities. I sometimes poll my classes as to how much cash my students have on any given day; very little and many times, none. However, all of their payment avenues (credit card, student IDs, debit cards) all are paid for through U.S. currency (even though some people believe it is not worth much). But a new currency?
During travels at the University, my finance colleagues always opine and educate me on the various economic and policy issues relating to money supply, real estate valuations , currency value, debt and stock market valuations. And how the IMF, Fed, SEC and Federal Government influence economic, banking, investment and currency matters. But, a new currency? What am I missing?
Now you see all the articles about Bitcoin and Mt Gox. The Wall Street Journal reported that on Friday (2/28) “more than $470M of the virtual currency vanished from its digital coffers” leading to the collapse of Mt. Gox. Within the last four days, the Washington Post, Reuters, MarketWatch, and USAToday have reported various details of the same thing; the rapid downfall of virtual currency.
But only a few weeks ago on February 17 (2014), Forbes wrote an article on “How To Use Bitcoin To Shop At Amazon, Home Depot, CVS And More“.
Haven’t we learned? The stories of WorldCom, Enron, Madoff and the housing bubble? All situations that were fairly regulated and watched? But they still happened. However, some people “bought into” a virtual currency.
Governments, regulatory agencies, banks, financial markets and accounting firms are not perfect. However, circulating currency for business activities without any oversight or regulation is just plain stupid.