Blockchain or Blockheads? Bitcoin Mania Mints Believers and Skeptics

John Schwartz, writing for The New York Times, discusses Bitcoin with Jim Harper.

Sometimes life shows you what absurd really is. This is one of those times. I’m talking about the phenomenon known as Bitcoin, a monetary system based on computation, complex algorithms and — let’s face it — communal delusion.

You’ve probably heard about this funny money, digital tokens that can be sent securely from computer to computer, with records kept through an online accounting system known as blockchain. (My colleague Nathaniel Popper has been writing great stuff about it.)

Millions of people now have accounts with Coinbase, the leading marketplace for digital currencies. And the rush into the market has helped push prices up. At the beginning of last year, you could pick up a Bitcoin (not literally, because they’re virtual, DUH) for about a thousand bucks. Its gyrations briefly brought its price near $20,000, according to Blockchain.info, which tracks such things.

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For another point of view — because I’m all about even-handedness, people! — I checked with Jim Harper, executive vice president of the Competitive Enterprise Institute. He served on the board of the Bitcoin Foundation and says the promise of Bitcoin is to create a payment system people can use anywhere in the world with privacy and security. He says its true value will be in commerce, not speculation.

Well, that hasn’t happened yet; the price is too unstable. He said the currency will move beyond some of the early notorious uses in illegal commerce. As for the tulip comparisons, he joked, “Laugh all you want: My initial coin offering for cryptotulips will be worth billions!”

Read the full article at The New York Times.