BitCoin? Again?

It’s been two years since I mused about BitCoin.  Since that time, it has become quite a bit more prominent.  What’s happened?  Well, it was at the center of finances for a drug thing, the preferred currency of criminals the world over, and now accepted by reputable firms, the latest being Microsoft itself.

I thought this thing was just a passing fad, to die out once every minor realized the futility of wasting electricity on generating hashes.  But, it seems the currency has lasted into legitimacy.  The US IRS/Treasury did an interesting thing.  They termed it an asset, not a currency.  And therefore, you’re supposed to pay taxes each time you exchange it… Yah, good luck with that.  But, it’s young still.

The big deal here I think is to have the likes of Microsoft invested into the currency.  Microsoft, a multi-billion dollar company, is now taking in this cyber currency.  What will that mean?  I don’t think anyone in the world will truly understand the implications, network effects, unintended effects, etc.

At the very least, it means that Microsoft has one more tool to do currency trading.  According to stock reporting, MS is one of the best currency traders in the world, reguarly doing as well as any investment company out there.  So, as they say, follow the money.

I also think this is a major step for the re-birth of currencies.  The dollar, long the stalwart, is showing signs of its age.  It’s hard for a paper currency to keep up with the dynamics of modern day market forces.  Quantitative easing?  Print more money, monkey with the prime lending rate, treasuries, blah blah blah.  Not that cyber securities will be any better, but they do have an interesting aspect of being controlled more directly by distributed market forces.

Did we just see the emergence of the “galactic units”?

I don’t know, but having Microsoft in the game is a game changer.  I’m sure all other largish companies with billions in assets to manage will soon follow suit.  Then, the world will become an even more interesting place.

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