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Category: Bitcoin

There are 8 posts published under Bitcoin.
28 Oct, 2013

Decentralization: Key to Bitcoin’s Success

Bitcoin is now becoming a household name as, once again, the price of each coin is nearing 200 USD and more companies are selecting to accept payment in this convenient, yet new payment option. With the recent closure of Silk Road and the US government’s temporary shutdown, Bitcoin has proven to be a force to be reckoned with.

 

What makes Bitcoin unique? It is a digital, decentralized, cryptocurrency and a gateway to send money anywhere around the world with just the click of a mouse or the scan of a QR code to anyone with internet access. Proponents of Bitcoin pride themselves in supporting the lead cryptocurrency, which is based on peer to peer transactions. Yet, one must never take the decentralized nature of Bitcoin for granted.

 

Unfortunately, any system can trend back towards centralization if not carefully monitored and safeguarded. As humans, we can, unfortunately, move towards centralized structures for an, often times, false sense of “security” and “certainty.” Centralization tends to create more problems than naught when the power to make decisions falls into the hands of a select few. History provides evidence of the tremendous failure of central planning with the collapse of the Soviet Union, massive starvation and lack of development in North Korea, and, right now, a bloated US Government with a growing bureaucracy with an accompanied skyrocketing debt. On a US-centric note, how can a Washington bureaucrat really know and meet the needs of a school teacher in California or a farmer in Iowa? In the end of the day, each individual knows what is best for his/her needs and with systems and societies based on greater individual responsibility; in turn, systems that are more diverse will meet more needs than blanket solutions and inefficient “one-size fits all” policies. So, while there is comfort in having to be responsible for less in the short-run, there are too many unintended long term consequences.

 

Bitcoin is not just a currency, but a movement towards decentralization in society, government, financial systems, and thought. It has served as a catalyst to provide power to individuals seeking to separate themselves from constricting governing bodies and failing central banks. To date, Bitcoin has been characterized as an open source project prompting discussion of the role of money in society, the danger of current banking structures, and the creative decentralized solutions to centralized problems in society today.

 

A model of organized decentralization is key to the success of Bitcoin around the world. Decentralization does not equate to chaos, but many individuals at work to promote a project with the common goal of strengthening a project and not placing trust in one entity. The best example of organized decentralization would be grass roots activism and organization within the Bitcoin community instead of central actors making all major decisions and protocol adjustments. Each member of the Bitcoin community serves a unique role and has a distinct voice and part to play in keeping the Bitcoin currency on a pathway to success, growth in value and utility, and a global reach. Most members of the Bitcoin community already recognize that the larger the user base, the less volatile the currency, and the greater legitimacy lent to the currency.

 

Open source software is also vital to the preservation and strengthening of Bitcoin. With decentralization in the development community, there is greater room and leverage for an increased number of individuals to enter the community and contribute. The question, then, may arise as to how the Bitcoin Qt client can remain decentralized. An option which has prompted growth in Bitcoin development is when businesses have given back to the Bitcoin community through hiring individuals to solely work on the Qt client. There is value in the marketplace of ideas as trial and error and diversity of thought inspires the development of the strongest wallets, payment processors, and software. There is too much risk in entrusting all development and protocol to a few. The Bitcoin community must continue its commitment to the open-source ideals that make Bitcoin the resilient system it is today.

 

As Bitcoin continues to increase in value and central banks continue to disappoint, it is clear that decentralization leads to healthier societies and global financial success. What will become of Bitcoin? To date, Bitcoin is the most successful cryptocurrency and is still in earlier stages of development. What we do know: a model of organized decentralization is vital to the success of the Bitcoin currency and movement.

Elizabeth T. Ploshay
357
10 Sep, 2013

Top Startup and Tech News Today-7 Things You Missed Today

1. How eBay Could Rescue Bitcoin From the Feds

 

Bitcoin exchanges have run into a hurdle in the form of the U.S. banks. There are questions about whether or not they “meet federal and state money transmission business regulations.” While this is quite a setback, another company is in prime position to take advantage of the situation: eBay. It had a “virtual currencies” section, allowing people to sell and purchase Bitcoins—it’s a forum for Bitcoin exchange, bypassing the federal and state regulations via PayPal.

 

The only thing preventing eBay from taking advantage of this opportunity, should they choose to do so, is the fact that Paypal allows chargebacks. Someone could purchase Bitcoins on eBay and simply state that the Bitcoins weren’t delivered, defrauding the seller. If eBay manages to solve this problem, PayPal could be in even bigger competition with Bitcoin. “They could very well find their business model outdated,” states financial regulations lawyer, Van Cleef.

 

2. Google is joining the Open edX platform

 

Google released Course Builder, an experimental platform, last year to test the waters in online education. It was well received with a multitude of different online courses available with various institutions experimenting with MOOCs (massive open online course). To continue with the online education front, Google has decided to join Open edX, a non-profit aiming to provide interactive online courses, as a contributor.

 

The effects of the combined efforts of both companies will provide much for the developers and consumers. Director of Research, Dan Clancy says, “We hope that our continued contributions to open source education projects will enable anyone who builds online education products to benefit from our technology, services and scale. For learners, we believe that a more open online education ecosystem will make it easier for anyone to pick up new skills and concepts at anytime, anywhere.”

 

3. Consumer: Stay Smart to Avoid WiFi Hackers

 

Becoming a super connected metropolis with free WiFi everywhere sounds great, but it also has its cons. One glaring problem is the presence of WiFi Hackers. Leeds is one such city that hopes to realize this vision.  A survey done on Britons was done to examine their WiFi use and determine how safe people really are.

 

Half of the surveyed do not know if the WiFi hotspot they use is secure, opening them up to identity fraud. Two thirds use the hotspots to check their email, a smorgasbord of personal information. Even more surprising, ten percent of people access their bank accounts with the public WiFi.

 

A brief list from these findings states that: important online tasks should stay at home, remove automatic connections on your mobile device, and don’t use apps whose encryption method is unknown.

 

4. Microsoft Seeks Cloud, Mobile, and Gaming Startups in London’s Tech City

 

Microsoft launched a 12 week accelerator program for UK cloud, mobile, and gaming startups in East London Tech City. 20 startups will have the opportunity to gain mentorship from executives from Microsoft, Train2Game, Lift London, and more.  This program is the latest of 10 around the world by Microsoft. The success rate of companies, from a total of 119, getting funding (within 6 months of the program’s end) is 85 percent! The kicker, though, is that Microsoft does not plan on taking equities from the startups. Rather, they will hope that the accelerator program will help to create future successful partnerships and additions to the Microsoft family.

 

5. Facebook Rolls Out “Professional Skills” Section on User Profiles

 

Facebook tries its hand at doing what LinkedIn has been already been doing, acting as a professional outlet for users. It recently included a new feature that allows users to add professional skills to their profile. Facebook takes this one step further than LinkedIn in that they connect skills to relevant interest groups, giving potential hires even more exposure. For those who worry about privacy, there is an option to adjust the privacy settings on the resume.

 

“If Facebook’s Professional Skills feature takes off, you’ll be able to browse through friends’ vacation picks and potential hires, all at the same time.”

 

6. What Startups Need to Know about Obamacare

 

With Obamacare coming out soon, startups have more health insurance options available to employees. Plans will come in 4 flavors—the typical Bronze, Silver, Gold, and Platinum setup, each with increasing cost and coverage.

 

Exchanges will start on October 1st, 2013—small businesses can take advantage of this time and look at the exchanges and plans. Since insurance companies will not be able to deny anyone, the rates for insurance will increase, especially for those below the age of 30. However, most of the regulations placed onto small businesses are delayed until 2015 instead of 2014.

 

7. Fun: First Actual Computer Bug Was Found Today, 66 Years Ago

 

It’s time to celebrate the 66th birthday of the first discovered computer bug! In 1947, the Mark II Aiken Relay Computer in Harvard had a peculiarity in its system—a bug. For all the technophiles out there, it, unfortunately isn’t the metaphorical bug we all know of; it was literally a bug; a moth. The person who helped to publicize this and coin the term “bugging” and “debugging” is Grace Hopper. The moth itself exists in a logbook in the Nation Museum of American History, but, unfortunately, is not on display.

Dat Mai
5312
4 Sep, 2013

Top Startup and Tech News Today-7 Things You Missed Today

1. YCombinator’s Paul Graham Now Taking Applications for Startup School 2013 (and it’s Free)

 

Beginning a startup company is not an easy thing to do, but what if there’ was a school of sorts that can teach you how to do so?  Paul Graham of YCombinator created such an institution called Startup School. The best part about it is that it’s free, making it affordable for anyone interested.

 

With speakers like “Facebook CEO Mark Zuckerberg, superangel Ron Conway, Pinterest founder Ben Silbermann, and Uber founder Travis Kalanick,” it’s guaranteed that the limited seats will fill up quickly. In order to gain access, the application due September 20 will also include telling “YCombinator about your education, work, developer tools, and ‘the coolest thing you’ve built.’”

 

The school has definitely shown some results—as Graham has written on his website: “Many founders have told us that this event was what finally made them take the leap.”

 

2. Google Announces Android 4.4 KitKat, Celebrates More than 1 million Android Activations

 

Google’s new Android software, originally rumored to be dubbed “Key Lime Pie,” is announced to be “KitKat.” While Android releases have always maintained a sweet treated title, this is the first time that it borrows a name from a famous sweets company—in this case, Nestle, their new partner.

 

The significance of passing over another generic name coincides with their goals with their million plus users. “It’s our goal with Android KitKat to make an amazing Android experience available for everybody,” Google exclaims. In addition to the newly formed partnership and the associated aspirations of both companies, over 50 million specially branded KitKat bars will be distributed with each one will leading the consumer to a special, prize offering web page.

 

3. 7 Things Going Against You as a First-Time Entrepreneur

 

Rajesh Setty, a serial entrepreneur talks about the 7 major problems that entrepeneurs need to overcome in order to be successful. The first issue mentioned is that people need to be able to see escalating friction. Just having an idea alone will not result in friction whatsoever, it’s when you start to do something about it—whether you start reflecting on the idea or bringing it to prospective clients. The main thing you must remember is to be able to understand how much friction each action will cause.

 

You must also not confuse activity with progress. “In general, any activity that cannot create value to your customers in a measurable way needs to be questioned. There is a good chance that it’s just activity leading nowhere,” Setty says. In the same vein, a lack of valuable accomplishments is an important hurdle to jump over. If the product you have is not amazingly awesome, you must build an identity to the venture.

 

Not knowing what to do is fourth on the list. This, of course, comes with experience and, for those who haven’t yet gained any, this is where you should listen to the wisdom of others who have been there. Next is called “concluding for convenience,” where Setty says to tackle problems early and head on; playing the blame game will not and does not help the venture.

 

The penultimate item on his list is “trying to fix your weaknesses fast.”  In entrepreneurship, there “is no trial run…everything is real.” Instead, it’s suggested to invest in your strengths and then to invest in a team to compensate for your weakness. Finally, don’t think that you have it all under control. Setty ends with “Entrepreneurship is a game that you win in the long term. It is a game that is beyond just you. It is a myth to think that you alone will have it all under control, however smart you are.”

 

4. The Messiah’ Gives His Reasons for Hacking Sun Ho’s Site

 

A hacker by then pseudonym “The Messiah” hacked into the website of Sun Ho, the co-founder of City Harvest Church. The hacker reappeared on a Q&A site, stating his affiliation with a group called “Anonymous Collective” and detailing the weak security of the site. “It took us less than 15 minutes to gain access,” he said.

 

The information he says he obtained and plans on exposing includes addresses, phone numbers, emails, and passwords. Due to the security leak, it was found out that the City Harvest Church had been embezzling church funds of about $50 million to fund Sun Ho’s U.S. singing career.

 

5. Top 6 Regions With the Most High-Tech Startups

 

Research was published stating that one of the biggest source of employment opportunities lie in high-tech startups. In fact, the job creation at these high-tech companies far offsets the initial destruction that occurs when startups meet with early-stage business failures.” If you’re looking for a high-tech job, where would you be likely to find a high-tech startup company? The Ewing Marion Kaufmann foundation created a list of 6 places with the most startups in the nation.

 

Denver has a large community of startups with over 500 companies—it has the sixth largest high-tech startup growth since 2011. Seattle comes in fifth, with the title of the “historical birthplace of significant IT infrastructure and business services.” Cambridge-Newton-Framingham, Massachusetts comes in fourth with a strong talent pool. San Jose-Sunnyvale-Santa Clara, California houses Google and many other similarly powerful companies. Fort Collins-Loveland, Colorado has Colorado State University—their resources and research facilities is enough to have many high-tech companies relocating here. Finally, Boulder, Colorado comes in first, with 6.3 times the national average for the number of startups it holds. This place is also praised for “its education, health, quality of life, and well-being.”

 

6. Bitcoin 0.8.4 Update Offers Security Improvements

 

Bitcoin-qt has come out with the new 0.8.4 update, trivializing bugs in the old code. The first issue in the previous version was in reference to the amount of block chain to be downloaded in order to view relevant transactions; it was possible for an attacker to overwhelm bitcoin-qt’s nodes and cause lagging or crashing.

 

This new update also fixes a security issue in previous version of bitcoin-qt. The password system would check the password by looping through each letter to check for accuracy. This meant that the more accurate a guess at the first letters of a password, the longer it would take to verify. This promotes a trial and error style attempt at guessing others’ passwords.

 

The last of the list of improvements prevents transaction attacks. These attacks could work in 2 different ways. The first allows an attacker to send an invalid transaction to one client and a valid transaction to someone else, which can allow for double spending of bitcoins. The next involves sending malicious transactions to others, causing disconnection from and harming the nodes used.

 

7. One-on-One Tutoring? Tech Startups Finally Catch On

 

InstaEDU, a San Francisco startup, allows students to connect to tutors online. InstaEDU, founded by couple, Dan and Alison Johnsoton is part of a market that is expected to grow from $11 billion to $13.1 billion in the United States between 2012 and 2015.  The idea was conceptualized when they realized how having an in-home tutor was a luxury coupled with students mostly asking for last minute help in the middle of the night.

 

Using mainly Ivy league students as tutors, InstaEDU has been able to further build on the idea of online education, allowing for quality and affordable tutors to anyone around the world. “I think it will reach more students who aren’t willing to go out of the way,” a tutor and UC Berkeley student says.

Dat Mai
414
20 Aug, 2013

Why Cash Is Still King – And When Will Its Reign End?

Cash  - it’s almost become a dirty word – associated with avoiding taxes, reluctantly paying for cabs, and obnoxiously splitting bills 14 ways with you and your college friends at a restaurant.

 

Who carries it? Who even uses cash anymore? In a world of increased “electronification”, why is cash even needed?

 

To be fair, there is no doubt electronic payments are growing. 175 Billion – this was a recent number I read on a payments report on the EU, referring to the number of non-cash transactions that Europeans would make by 2020. The number here in North America was likewise comparable, and represented a strong trend towards electronic payments.

 

But further down in the article was a more subtle, but revealing fact that 60% of all payments in 2020 would still be made in cash. With some simple math, that means that over 200 Billion transactions will be made in cash 7 years from now. And that’s inclusive of 7 more  years of smartphone growth, as well as 7 more years “attempting” NFC.  And still: 1000 cash payments per person on average in the EU and in North America alone!

 

So why is this the case?  The challenge with cash is not for the person who uses it - the payer -  but rather the person who receives it – the merchant or payee. I will make a reasonable assumption that most payers by and large prefer electronic means of payment – credit, debit, ACH – over cash. But I feel we often forget that payments is a two sided ecosystem and, in most cases, the ability to pay electronically is not a choice the payer can make, but rather an ability that is either accepted or rejected by the recipient. And thus, the true growth of electronic payments is not about the person making that payment but the person receiving it. That’s why Square’s approach – arguably almost entirely merchant focused – is successful in pushing cash to electronic, while other approaches focused directly on consumer – Google Wallet, ISIS, any NFC play known to man - have yet to find success. Yes the consumer wants to pay electronically, but the merchant doesn’t; or does so reluctantly. Merchant wins. And cash prevails.

 

But if moving money to electronic means is mostly about the merchant, how easy will it be to create this “acceptance”? Unfortunately cash still has a strong set of incentives that I believe will be challenging to uproot.  For one - cash has the perception of immediacy: its very tangibility (although also a major flaw – expensive, dirty, easy to fake) creates instant trust, a message of “you’ve been paid right now”.  The removal of cash also comes with the addition of new costs – systems to take electronic money, software to account for it, and more. Of course, there are many costs to already accepting cash, but convincing someone that they are paying too much for status quo is always tougher than incurring cost for change.

 

Cash is also a market of its own. Like “technology” itself, eliminating cash means eliminating jobs. Now, of course, we can argue that jobs are also created, but largely creating an efficiency in the system means less processing and less labor required. To be clear, I still feel largely that removing cash is an advantage for consumers – a consumer win, no doubt. But in this instance the removal of labor is not always an easy hurdle to overcome for the recipients (especially in large organizations – think governments and the like).

 

On the whole, I believe that the incentives of electronic payments, although widely “proven” and backed by “data”, aren’t always strong enough to create behavior change, which, incidentally, doesn’t necessarily have a price.

 

So when will the reign of cash end? Certainly not anytime soon. But if there is a way to accelerate the growth of electronic payments, it will likely happen where consumer change meets merchant status quo. Put another way: giving consumers the ability to pay electronically without relying on the merchant’s ability to “veto” their choice, will create the biggest growth.

Eliot L. Buchanan
305
15 Aug, 2013

Top Tech and Startup News: 7 Things You Missed

Below is today’s top technology and startup news.

 

1. $6200 Bitcoin Heist Threatens Android Operating System

Hold onto your digital wallet. As expected, flaws in operating systems are being exploited to “pilfer” bitcoin. Google developers confirmed the cryptographic vulnerability, claiming there is a serious threat to “hundreds of thousands” of Android apps.

Undoubtedly, this is bad press for Bitcoin. Yet, this is even worse news for Android, with over 90% of mobile malware being detected on this mobile operating system.

Update: Today, it was reported Google is distributing patches through the Openhandset Alliance.

Here’s a quote from Alex Klyubin, a Google security engineer who first reported the situation:

“We have now determined that applications which use the Java Cryptography Architecture (JCA) for key generation, signing, or random number generation may not receive cryptographically strong values on Android devices due to improper initialization of the underlying PRNG.”

http://arstechnica.com/security/2013/08/google-confirms-critical-android-crypto-flaw-used-in-5700-bitcoin-heist/

https://bitcointalk.org/index.php?topic=271486.0/

 

2. Google Blocks Microsoft’s YouTube app

Just days after announcing the release of the YouTube app on Windows Phone, Google has officially blocked the app.

This action was in response to errors which started to pop up this week. Google stated the full YouTube experience could not be enjoyed with the current browser.

Here’s a quote from a Google spokesperson:  “It has been disabled. We value our broad developer community and therefore ask everyone to adhere to the same guidelines.”

http://www.theverge.com/2013/8/15/4624706/google-blocks-window-phone-youtube-app

3. Washington Post has been Hacked by Syrian Electronic Army

It’s been a big week for the Post. After Jeff Bezos announcement to buy the Post for an estimated $250 Million, the website is now being hacked. Reportedly, readers of some articles are being redirected to the Syrian Electronic Army website.

http://allthingsd.com/20130815/washington-post-site-is-hacked/

4. “Julian Asssange with a Hypodermic Needle” - The Silk Road drug peddling website to be featured in magazine

He’s the Al Capone of the internet, known more commonly as Dread Pirates Roberts, and has been carefully building a website to meddle drugs over the last two years. And, these are not just your typical over-the-counter drugs. We’re talking heroine, meth, crack, LSD and ecstasy - all mailed through our local, friendly post office.

Forbes plans to run a full-feature article on Roberts.

5. Paypal freezes IndieGoGo campaign worth over $100,000 - then reverses the decision

With 9 days to go in the campaign, a Google Glass competitor ‘GlassUp’ was told they will only receive “a tiny amount of the funds.” The Italian hardware manufacturer would have been greatly hampered by this decision. But, after receiving mainstream press, Paypal reversed their decision stating:

“We looked into what was happening with GlassUp and corrected the situation earlier today. GlassUp now has access to all of the funds that they’ve raised on Indiegogo through PayPal. We think they are developing a fascinating product and don’t want to impede their innovation in any way.”

http://venturebeat.com/2013/08/14/glassup-raised-100k-on-indiegogo-but-paypal-is-refusing-to-pay-up/

 

6. Awesome Fashion Designer Fights Government Surveillance

Here’s one way to speak out against Government surveillance. An activist and designer has created an anti-drone garment, resembling a burqa to demonstrate the seriousness of our situation. The garment reflects heat, masking the wearer’s thermal signature while reducing visibility to infrared sensors. You can check it out here:

Adam Harvey / ahprojects.com

http://www.washingtonpost.com/lifestyle/style/designers-trying-to-help-people-fight-government-surveillance/2013/08/15/824faf84-0533-11e3-88d6-d5795fab4637_gallery.html#photo=7

 

Fashion designer fights against surveillance

Fashion designer fights against surveillance

 

 

7. Design Your Heart Out: Getty Releases 4600 Amazing Images to the Public

In a world of stock photos and vector art, the newest announcement by Getty is a pleasure to hear. Perhaps one of the World’s finest collections of artwork is now open to the public, free of use. The iniative, which sets a precedent for other art collections, is called the Open Content Program and is free to use.

You can browse the collection here: http://search.getty.edu/gateway/search?q=&cat=highlight&f=%22Open+Content+Images%22&rows=10&srt=a&dir=s&pg=1

 

daily tech news

Beth Kindig
2033
19 Jul, 2013

Coin Ava: First Iranian Website Open for Bitcoin

Just this week Coin Ava launched as the first Iranian Website open for Iranians to buy and sell Bitcoins.

While Iranian leadership is known for tight regulations on citizens in particular for those seeking to utilize the internet and community with the rest of the world, Iranians have found a way around onerous authoritarian restrictions through the Bitcoin currency.

 

Last year, Bloomberg Businessweek pushed out an article, “Dollar-Less Iranians Discover Virtual Currency” to conclude, “For now, Iranians are using bitcoins to maintain a fragile connection to the outside world.”  Iranian citizens are able to use the Bitcoin currency as a gateway to purchase products around the world and through the Bitcoin currency are not confined to a devalued Rial.

 

Although unaware of the domestic social and political situation in Iran, outsiders can sense a form of oppression of the Iranian people under the current regime. Due to the current Iranian Leadership, Iran is economically in distress. Fortunatley, in the coming future, there are a few factors that may play a role in an attempt to benefit the Iranian citizens financially, one of which is Bitcoins.

 

As a former Foreign Policy staff member for a Member of the US Congress, I understand the hesitancy some might have to applauding the growth of Bitcoin in Iran.  Whereas it is evident that the current regime in Iran has violated international law through disregarding International Atomic Energy Agency (IAEA) standards and frequently utilizing hate-filled rhetoric, it is also true that there is a sizable group of Iranian citizens who oppose the totalitarian actions of their government and are working to reform their country.  The Iranian Bitcoin question is a touchy subject for most, but can be worked through if viewed through lenses centered on the purpose of the Bitcoin currency.

 

Whereas Bitcoin is a digital, decentralized currency, it serves as a source of empowerment for individuals around the world to take the initiative to control personal finances and become financially independent from a centralized source of control.  In some nations, the desire to be independent from a central bank is not as strong as not all nations have authoritarian leadership and high inflation rates.  Yet for some nations Bitcoin provides a source of financial security and promise outside of any centralized currency to citizens.

 

Coin Ava’s launch this week has prompted dialogue once again over the many purposes of the Bitcoin currency and the intrinsic value this digital, decentralized currency holds of citizens living under the auspices of an authoritarian government.  From the perspective of a former Capitol Hill staffer who ardently opposses Iranian nuclear development, hate speech, and human rights violations, I see the growth of the Bitcoin currency in Iran as a way for the iranians to single-handedly aid their financial situation. Where there is a will, there is a way, and Iranian citizens have worked to combat Iranian leadership’s poor decision making with the Bitcoin currency.

 

Elizabeth T. Ploshay
343
21 Jun, 2013

From Capitol Hill Into the World of Bitcoin: A Special Report

 

Since my transition from Capitol Hill into the Bitcoin community, my eyes have been opened to the immense potential of this digital, decentralized, cryptocurrency.  Bitcoin not only has the capacity to revolutionize financial payments but also to showcase the numerous benefits of a limited government space.  To date, Bitcoin is free from onerous regulation and as a result has grown not only in value but utility for individuals but also businesses.

 

The Bitcoin currency represents the ingenuity that our Founding Fathers initially envisioned prior to the vast expansion of the federal government.  As a peer-to-peer currency, Bitcoin is not controlled by a centralized source.  Additionally, peer-to-peer exchanges of Bitcoin take place on an international basis and Bitcoin has the potential to transform what we see as money today.  At the center of the Constitution, one finds individual and states rights.  Just as the Constitution was put in place to protect individuals and states from an overbearing, centralized federal government, the Bitcoin currency provides an opportunity for each individual to take a step away from the tight control of the federal reserve to invest in a currency that is based on convenience, ingenuity, and free market initiatives.

 

In an age of increased government regulation, Bitcoin stands as a credible option for individuals to invest in a currency free from centralized control and inflation.  If asked point blank, the majority of Americans would rather have less government control over their finances.  This preference is accompanied by an understanding that larger government intervention in the economy and the US dollar is not always correlated with economic success.  In an age of bloated government policies on both sides of the political spectrum, it is time for each individual to make the choice as to whether or not to invest in opportunities to expand individual liberties and personal freedom or accept the status quo.

 

With the US Federal Government trillions of dollars in debt and struggling to enforce a budget, we cannot be too trusting of the Federal Reserve to best manage our finances.  With taxpayer dollars spent right and left, individuals should have the right to use a currency which is not subject to inflation and is free from excessive processing fees.  US citizens cannot truly count on the dollar remaining constant as we have seen international currencies plummet in value.  Let’s take a look at the Argentinian Peso.  With inflation rates skyrocketing to over 25 percent, numerous Argentinians are choosing to invest in the Bitcoin currency to prevent further devaluing of their savings.  With the Federal Reserve more liberally printing money, the US is not too far off from Argentina.  Just as inflation has become commonplace for the Argentinian peso, US dollar is not free from inflation.

 

In addition to exemplifying Constitutional principles, the Bitcoin currency is an asset to small businesses.  During my time on Capitol Hill I noted strong political division, but at the same time strong bipartisan support for small businesses.  Just last year, when both Chambers of Congress and the Executive Branch struggled to establish a fundamental budget, the US House, Senate and President supported and signed into law the Jumpstart Our Businesses Startups Act (JOBS Act, H.R. 3606) to enhance the ability of small businesses to increase capital.  The JOBS Act highlights the critical role small businesses and emerging growth companies play in stimulating job growth and the US economy.

 

While small businesses serve as the backbone of the US economy and contribute to new employment opportunities, small business owners often struggle with high credit and debit card processing fees.  Most of you are familiar with signs by cash registers reading a specific dollar minimum for credit and debit card use.  Unfortunately, such minimums turn customers away from making purchases.  As we are becoming a cashless society, small businesses, merchants and local companies face an uphill battle of either incurring larger processing fees and costs OR establishing strict guidelines and minimum fee requirements for credit and debit card use.  What is the solution: Bitcoin!  Not only convenient, but a sure way for small businesses to avoid onerous credit and debit card processing fees.

 

As the House, Senate and President backed the JOBS Act in the 112th Congress and are now implementing this pro-growth legislation, further consideration of the Bitcoin currency should be on the books for the 113th Congress.  As the Small Business Administration sizes up options to best facilitate small business growth, a consideration of the Bitcoin currency will be a wise investment of resources.  What if the Small Business Administration decided to revamp the already existing grant and loan program with a track for businesses utilizing the Bitcoin currency?  Business owners would have greater leeway in finding the best methods of transaction not only to meet customer needs but also to efficiently collect revenue and in turn stimulate the economy.

 

With many vendors and small businesses already processing payments through iPads and updated computer systems, imagine how simple it would be for customers and business owners to make transactions at any price with the simple scanning of a QR code.  Let’s take this a step further.  Small businesses and merchants reaching out to an international audience will avoid high currency exchange rates as Bitcoin is a decentralized and international currency.

 

While growing in monetary value, the principle behind the Bitcoin currency continues to promote common sense, pro-Constitutional, economic and political liberties.  It’s time for both sides of the political spectrum to come together and support a sustainable, pro-growth solution to the woes of individuals and small businesses: the Bitcoin currency!  With our executive and legislative branches frequently disregarding the fundamental, limited government and free market principles highlighted in the Constitution, it is your turn to reclaim your Constitutional rights and liberties one bit at a time.  Take the step today to invest in Bitcoin to remove the middleman, speed up transaction time, enjoy a portable and international currency and most importantly assert your individual rights in a time when the theme of the US dollar is inflation and centralized control.

 

Elizabeth T. Ploshay
342
11 Jun, 2013

The Future of Money and Bitcoin by Chris Larsen, CEO of OpenCoin

We’re entering a new era in the evolution of money.

Commodity money was first—gold, precious metals, things considered inherently valuable. Next came political money—fiat currency, banknotes, things that had value because they were backed by governments and legal systems. Now there’s math-based money—money controlled only by protocols and algorithms. Harnessing and maximizing the power and potential of these new math-based systems is going to be the big story in finance for decades to come.

 

Bitcoin made this revolution possible. It kicked down the door and opened everyone’s eyes. Money has always presented a technical problem—how can we track value in a way that is reliable and useful to extended networks of people? For centuries, the best available money “technologies” were business contracts: my bank will keep a faithful record of my accounts, Visa will process my PoS payment, MoneyGram will move this cash around the world, etc. Bitcoin proved that computer protocols are as effective as institutional practice at handling security and reliability. Money had been manual, now it is automatic.

 

Once the technical obstacles were toppled, then math-based monies began to accrue value. At the time it was shocking. In hindsight it’s pretty obvious. The utility of math-based systems is off the charts. Transactions are cheap, fast, and global in a way that was previously impossible. Critical elements of the financial infrastructure can be replicated with only a few lines of code. Processing lag, network limitations, service fees, and the many intermediaries of the money systems can now be streamlined or eliminated. Critics have attacked Bitcoin’s valuation as “speculative,” but a technology with such heterogeneous application demands early speculation. What is the appropriate value of a technology that can dramatically cut transaction fees, reduce transaction speeds by days, and finally interconnect the global economy?

 

We are only at the very beginning of this process. Bitcoin focused on a single target—creating a digital currency—but there are a plurality of targets, and the development and expansion of math-based money is an iterative process. How can math-based principles be applied to mainstream currencies? What other financial operations can be automated using network protocols?

 

A new wave of technologies looks to answer these questions. Post-Bitcoin technologies like the Ripple Protocol now exist that facilitate payments in all existing currencies, automate currency exchanges, and process cross-currency transactions. Software is in development that will allow derivatives, loans, interest rates, fees, subscriptions, and exotic financial instruments to be processed by algorithms. These money technologies give merchants new options, consumers more control, and financial institutions powerful new tools. So-called “cryptocurrency” may have a fringe reputation now, but the long-term impacts of math-based money systems are 100% mainstream.

 

The ultimate promise of math-based systems is to bring the principles of the Internet to money. Money is information and the Internet is the greatest information engine of all time. The missing link was a money protocol. The Hypertext-Transfer-Protocol allowed the Internet to share text and graphics. The Simple-Mail-Transfer-Protocol made communication free and instantaneous. Each of these protocols had a seismic impact on our reality. The Ripple Protocol and others like it will have a similarly profound effect. Independent businesses using shared protocols will be able to do businesses directly without requiring third-party services. Fragmented networks will become unified and frictionless. Old business models will be disrupted and new ones will become possible.

 

It won’t happen overnight. Financial systems have considerable inertia. Money technology is notoriously out-of-date. Cards use 1960s magnetic strip technology. Last year, the U.S. minted 6 billion pennies. Adoption rates, regulation, and market dynamics are unknown quantities. But while the future of money may not have a timeframe, it finally has a framework.

 

Just like in the early days of the Internet, we cannot predict every breakthrough or innovation, but we know the platform on which those breakthroughs and innovations will happen. Who will be the Google, Facebook, or Alibaba of the math-based money era? We don’t know yet, but we know they’re coming. And when they get here, they won’t be using ACH.

Chris Larsen
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