Bitcoin’s value has steadily climbed over the past few months with no signs of stopping as the currency has managed to avoid major security breaches and expand its digital ecosystem. The dollar value of virtual decentralized cryptocurrency Bitcoin last week reached a new all-time high, eclipsing the previous high of $31.9099, last touched on June 2011.
The 24-hour average on MtGox now sits at $38.29 as of the time this story was published. If you spent $1 on electricity to mine bitcoins in the beginning of 2010–back when mining was still totally feasible at home–your stash would now be worth $53,300 and change.
The open source peer-to-peer currency has long divided opinion. It is at once the net’s most inspired invention or the most dangerous project ever. Skeptics call it a scam with no fundamental value, a ponzi scheme that enriches early adopters and provides no guarantee of value for those late to the party. Cyberpunks love it because it’s self-regulated by an elegant mathematical model, designed by a mysterious intellectual known only as Satoshi Nakamoto. Neo-libertarians support it because bitcoin operates outside the whims of central banks and pesky governments, the online version of hiding gold bars under your mattress. Darknet hoodrats use it for sex, drugs and gambling since it’s the digital equivalent of cash, nearly impossible to trace if you know what you’re doing. Tech nerds mine it, an easy way to make a quick buck if you’ve got the hardware resources. Bankers from Goldman Sachs and Morgan Stanley trade it because it’s their fiduciary responsibility to understand trendy new asset classes.
But the concept has yet to infiltrate mainstream culture. While bitcoin does boast a growing user base, the rest of us continue to enjoy the show, looking on curiously at this compelling, polarizing mix of freedom of speech, cryptography, decentralized open source computing, finance and politics. What we do know is that it seems like a big deal — if it does end up working out — one that could reconfigure our understanding of money, provide a true alternative to fiat currency, or at the very least allow us to easily send money over the internet and pay for things with minimal fees and oversight.
LIKE THE SECOND DOT-COM BUBBLE, THERE’S DIFFERENT FEELING THIS TIME AROUND. FOR ONE, THE ECOSYSTEM SUPPORTING BITCOIN IS CONTINUING TO GROW.