Bitcoin – the people’s currency or dangerously subversive?
Value of cybercurrency has fluctuated between €30 and €140 in recent months
David Fleming, Bitcoin entrepreneur. Photograph: Frank Miller
In 2008 a pseudonymous character called “Satoshi Nakamoto” invented a cyber-currency called bitcoin. Initially ignored by all but a few aficionados, it became the subject of huge interest earlier this year when a wave of speculation caused the price to soar . . . and then plummet.
The hype obscured the fascinating rise of an untraceable peer-to-peer electronic currency that crossed borders, eschewed regulation and was also used for nefarious purposes on the notorious Silk Road website (where guns, drugs and other illegal items are for sale).
The mystery around “Nakamoto’s” identity lent itself to the utopian narrative which many have structured around the currency. Brian Lucey, professor of finance at Trinity College Dublin, notes that bitcoin enthusiasts are often “crypto gold-standard people” who object to central bank control over money. Internationally interest seems driven by distrust of government and banking institutions. Anarchist types see it as an alternative to government-controlled currencies, while libertarian investors see it as a way to make a lot of money fast. In the US and UK both mingle at bitcoin meet-ups.
David Fleming, owner of Eircoin, “Ireland’s only bitcoin broker”, says such meet-ups haven’t taken off here yet, but he describes bitcoin as “one of the best forms of money that has ever existed. It solves one of the biggest problems we have, which is the expansion of credit at the will of whoever’s in control of the money supply . . . It’s better than gold, it can be transported easily and stored more securely and it doesn’t have the same cost to the environment”. But he’s reluctant to get too political, saying he sees it “purely as a useful technology.”
Mathias Linnemann has a more explicitly political interest in the currency. He works for a large technology company in Dublin and also advises companies how to incorporate bitcoin into their business models. “Personally I’m not for crashing governments or destroying the system,” he says, but he muses about how bitcoin might eventually become the unofficial currency of the international black market. That said, he thinks the stereotype of bitcoin being for those who want to avoid tax or buy drugs is overplayed. He sees it as the people’s currency.
“We live in a part of the world where it’s not really a problem that the government can follow what you do, but a lot of people are in places where it’s a big problem. And that’s where bitcoin gets really interesting.” He references Iran, Myanmar and North Korea. He recently visited Argentina where he made a short film about a man using bitcoin to avoid the perils of the inflating peso – the film can be viewed at bitcoinfilm.org. “I think a currency like this would have a huge potential to free a lot of people,” he says.