I shall probably get myself into dangerous waters here, but that has never bothered me in the past, so I shan’t let it bother me today.
Bitcoins, the beloved alternative currency of the Libertarian movement as espoused by those who are tech-savvy. The last word in that sentence alone should be sufficient to exclude me from the Bitcoin conversation. I am not tech-savvy; quite how I’ve managed to keep this blog afloat all these years is a mystery known only to the brilliant and eternally patient folk at Bluehost.com, who have extracted me from the deep binary doo-dah so many times that they now ask me for the current weather in the Dordogne before they ask for my password…
That hasn’t stopped me from following the fortunes of Bitcoins, as I have that of Gold; if only because it is the subject most frequently discussed in the serious Libertarian sites.
The theory seems to be (and don’t blame me if it isn’t – blame the people who attempt to explain it to the non-techy world) that the banking world is full of speculators, investors, and other ne’er do wells (including assorted lizards and people with the surname Rothschild) who treat money, the comfortable folding stuff, as a means to profit from the need of we ‘ornery folk to buy an egg for our brekkers. They knead it and manipulate it, and tell us its worth more than it really is, and then pull the rug from under us when we think we’ve got enough to buy an egg and say ‘Sorry mate, its Thursday, money’s gone down today, just half an egg for you’.
The folding stuff originated from a time when a lump of gold was enough to buy hundreds of eggs, which was monumentally inconvenient before they invented fridges, so you gave your lump of gold to a man, and he gave you hundreds of slivers of paper each worth the price of an egg. Voila! You could give the grocer a slice of paper each day for your egg, and when the grocer had collected enough slivers of paper, he could take them back to ‘the man’ and have a lump of gold instead. The grocer could even give them to the man with the Ford Cortina Mark ll, and get the car in exchange – and let him go chasing after the man with your gold.
All well and good, until it was discovered that the man with the lump of gold had a printing press in his garden shed and had been handing out slivers of paper like bloody confetti to everybody in sight, including the government – and he’d flogged 15 lumps of gold to someone called Fat Dildo in China when he only had three lumps in the first place… which meant that even if you’d been able to get your lump of gold back, it would only be worth a fifth of what you thought it was. I think I’ve got that bit right, but do correct me if I’m wrong.
Now some people got very excited about all this and said ’Gis our Gold back, I’d rather keep it under the bed’. Which was fine, and I can understand the sentiment, but it seems to me that there was still a problem there. a) You still couldn’t break a bit off your Kruggerand or your gold bar to pay the grocer, so at some point you needed to convert it back into folding money, and b) Fat Dildo was still insisting he had fifteen lumps of gold, and nobody knew whether he was an idiot, had dug some more up in his garden, or whether ‘the man’ had really sold him 15 lumps and the media was lying about ‘the man’ only having 3 lumps. Consequently, no one really knew what any of the lumps were worth, and investors and speculators and lizards and people with the surname Rothschild were making a fortune as the price of a lump of Gold zoomed all over the place.
Personally I went out and bought myself a chicken at that point, having more faith in an old fashioned hen to deliver my breakfast. I got a cockerel too; nothing like increasing production.
Enter the tech-savvy. They invented the Bitcoin. It only existed on the Internet. It didn’t have (note past tense) lizards or speculators. It only existed in Geek world. Geek world was solely inhabited by Libertarians, and they were all honest. It was the brave new world as opposed to the new world order. They had a terribly geeky way of manipulating their new currency, it was all to do with Field Programmable Gate Arrays (FPGA) and the inflexibility of Application Specific Integrated Circuits (ASIC) and other things that only the insiders truly understood. A bit like banking actually. But it was Geek land, and therefore the Internet trusted it. Anyway, they only used it to buy more property on Farmland and a few drugs, so what did it matter?
Unfortunately it seems that there were a few geeky lizards. Or IT experts called Rothschild. ‘Cos the next thing you know, up zooms the price of a Bitcoin. In three years the nominal exchange rate went from a bag full of 1300 of the little blighters for one dollar to $266 dollars for one little bitcoin. That’s what you call inflation. Er, and Speculation. Maybe the brave new world of Geeks and Libertarians wasn’t quite as altruistic as it imagined. Turns out that instead of just using them for drugs and bits of Farmland, some people were hoarding them, so that when people went to pay for their drugs, they couldn’t get hold of any, hence the people who had some charged the earth for them. Heroin addicts were quaking in their shoes.
I got interested when I heard that archetypical techy geek Rick Falkvinge, founder of Sweden’s Pirate Party, had cashed in his bitcoins for good old fashioned folding stuff. When tulips bulbs are shooting up in value and someone decides to get out of tulip bulbs, you know there is something up. The number of spam e-mails I got inviting me to invest in Bitcoins suddenly doubled, far outweighing the number inviting me to buy gold bars. Or Viagra.
Somebody appeared on reddit and gave away several thousand dollars worth of
tulip bulbs Bitcoins. Pandemonium raged. Were they completely worthless? Could be if people were giving them away! Within hours the price of the $266 dollar Bitcoin had dropped to $130 dollars, still way over its $20 price of three months ago. Was a late entrant trying to manipulate the market hoping it would go back up to $250?
Fascinating to watch, and if anybody wants to try and convince me to invest in Bitcoins, or indeed gold, after this last week, they are very welcome to try.
I’ve commissioned Mr G to build a bigger hen house. Old fashioned girl, me; I don’t like starting the day without my breakfast.