Story 2014-04-02 3HB Bitcoin Explained in Five Minutes

Bitcoin Explained in Five Minutes

in internet on (#3HB)
David Andolfatto, VP of the Federal Reserve Bank of St Louis offers a slide deck providing an easy-to-read overview of what Bitcoin is, how it works, and how it compares to old-fashioned currency [PDF] (from a central banker's perspective, remember) in terms of intrinsic value, security, and price stability. Andolfatto includes references to the Mt. Gox meltdown and to the recent IRS ruling that Bitcoin is property rather than currency; also, he's got jokes on the second slide (for the benefit of techies) and second-to-last slide (for the benefit of bankers). I think he's wrong about the size of the Bitcoin source code, though - he says it's 17 MB, but from a quick google search it doesn't look all that big .

[Ed. note: This is timely given how much Bitcoin, Dogecoin, and similar have been in the news recently. What does Pipedot think? Is cryptocurrency a passing fad, or the first chink in the armor of government regulated currencies?]
Reply 2 comments

Tough call (Score: 2, Interesting)

by Anonymous Coward on 2014-04-02 13:32 (#YA)

Considering that salt was once used to pay soldiers of Rome I vote for "it will continue to be used as a currency until a fatal flaw is found"

Price Stability (Score: 1)

by on 2014-04-03 09:45 (#YR)

I think Bitcoin's lack of price stability over short periods is its biggest hurdle ATM.

For example, you have 1 BTC: two weeks ago it was worth $150, last week it was worth $1100, this week it's value is $450. Hardly confidence inspiring.