A random spectator at a televised sports event held up a placard with a QR code and the text “Send me Bitcoin!” He received $25,000 in Bitcoin in the first 24 hours, all from people he had never met. This was the first time in history that you could see someone holding up a sign, in person or on TV or in a photo, and then send them money with two clicks on your smartphone: take the photo of the QR code on the sign, and click to send the money. Marc AndreessenI still haven't figured Bitcoin out: one moment I think it's revolutionary, another I think it's a scam. It could be both, of course. But when you have guys like Marc Andreessen speculating that something big might be happening (beyond the hype and puffery that goes with any new innovation), then maybe I need to take it seriously. Especially when we should be using the Euro's 'phoney war' moment to launch a complementary currency or two here in Ireland.
One possibility is that we might not need to worry about bailing out the banks in future, because we won't need them. David Z. Morris reckons Bitcoin could be Napster for finance:
The functions that advocates say could be automated through the Bitcoin network seem nearly endless, including peer-to-peer investment funds, Kickstarter-like crowdfunding, binding arbitrations, and even non-financial transactions such as naming rights management and encrypted communication. And all could be executed without a cut for intermediaries. Bitcoin partisans, from developers down to rank-and-file users, often seem to revel in the idea that they are threatening the control and profits of Wall Street institutions, who they see as rent-seeking fat cats. If it were limited to the loss of fees on payments and transfers, bitcoin's threat to existing financial institutions would still be substantial. But with a full array of commission-free financial services on the horizon, there is even more reason to take heed.There's something rather appealing about that.
But the possibility that most intrigues me is the potential for the new peer-to-peer currencies to accelerate our progress towards the Intention Economy. Right now, Google, Facebook et al get all my data and yours for 'free' via the information they capture about our digital activities. Remember, if something is free on the Internet then you're the product. But Bitcoin and similar innovations could create a new social contract whereby we receive micro-payments in return for sharing our data. In fact, every time you send an email you would have to make a tiny micro-payment. Heralding the death of spam...
Also a rather appealing prospect.
Who knows, it might even solve the problem of worsening income inequality in developed economies: if our digital and financial overlords have to share the wealth in return for transacting with us, the end of capitalism might yet be deferred. Again.