http://www.bbc.co.uk/news/technology-25617931
Bitcoin Crosses $1,000 on Zynga Move
Impressive. There is no denying that since the conception of the Bitcoin, its value has followed a not so steady upward trend. The road to this value has been rocky, especially after last year's crash from over $1,200. The result of the crash came from China, who implemented tactics and spoke out against the Bitcoin due to its lack of centralization. The response from the Chinese government wasn't a surprise. The European Banking Authority issued a statement regarding the safety and security of the Bitcoin. They basically said that if the Bitcoin holder loses a huge sum or any sum of money, it is entirely the fault of the holder because Bitcoin clearly isn't stable. These statements do have merit due to the anonymous and decentralized nature of Bitcoin.
Bitcoin is not regulated, so there is plenty of criticism of the currency, but there is no disputing the fact that it is becoming an adopted form of transaction among businesses. Zynga recently decided that it would accept the Bitcoin as a form of payment. Zynga is an online social media gaming website that releases games on sites such as Facebook. With the news of the Zynga acceptance, the value of the Bitcoin climbed its way over the $1,000 mark. I think that companies adopting the Bitcoin are definitely acting as progressives. They're supporting the technology and the innovativeness of the Bitcoin, but I'm not sure how many of them are actually going to stick to it fully. I have a feeling that many companies will just accept Bitcoin as a marketing strategy and to reach a wider audience, but I believe many of them will just exchange them for money. Reading about the Bitcoin, I was unsure of where it would fall into our country's GDP. It can be treated as an investment. If you were to buy a Bitcoin when it was valued at $100 and then sold it today at $1000 you would've made a hefty profit. Is Bitcoin considered investment spending? Or is it considered consumer spending? It may not have much of an impact considering its only a 5 billion dollar market, but you never know how much bearing it will have someday.
- David Gerhart
Monday, January 13, 2014
The Dollar Will Never Fall to Bitcoin
http://www.businessweek.com/articles/2013-12-24/the-dollar-will-never-fall-to-bitcoin
The Dollar Will Never Fall to Bitcoin
I loved this article. In our class, we learned about the uses of money and characteristic of good money. This article describes Bitcoin in comparison to the dollar based on the uses of money. My opinions on Bitcoin have now changed dramatically. I like it a lot more after reading this article and understanding how it protects against inflation. In my research I learned how Bitcoin was "inflation-proof" and how it may be the best currency we have seen to date. The latter piece of the the last sentence is not something I agree with, but I do think the Bitcoin has merit, and I support it more now than I did before. I think this article is particularly interesting due to the fact that it relates directly to what we did in class over the past few days and hits on money, inflation, and money supply.
The article was kind of eye opening in the fact that my reasons for supporting Bitcoin were contrasting with this author's reasons. In class we all tended to agree that the Bitcoin was an absolutely awful store of value due to its tendencies to rise and fall violently. We also agreed that it was a fairly decent unit of account if it would be more widely known. It isn't that hard to say a television is worth one Bitcoin. I did agree with the author in the fact that Bitcoin is a great medium of exchange. The author compares the Bitcoin to awesome gold. Basically, the Bitcoin is inflation proof because the "Bitcoin supply" in the global economy will only ever be 21 million BTC. Ever. It will never exceed that. For this reason, Bitcoin is deemed as an excellent store of value by the author. BTC is a solid medium of exchange due to its instantaneous nature and its security. Now, for the deal breaker for many economists: BTC is not a unit of account. You can't easily value a carton of eggs in terms of Bitcoin. For this reason the author believes that the Bitcoin will never beat the dollar. I'm not sure I agree with everything the author says, but I would love to hear what you think.
- David Gerhart
The Dollar Will Never Fall to Bitcoin
I loved this article. In our class, we learned about the uses of money and characteristic of good money. This article describes Bitcoin in comparison to the dollar based on the uses of money. My opinions on Bitcoin have now changed dramatically. I like it a lot more after reading this article and understanding how it protects against inflation. In my research I learned how Bitcoin was "inflation-proof" and how it may be the best currency we have seen to date. The latter piece of the the last sentence is not something I agree with, but I do think the Bitcoin has merit, and I support it more now than I did before. I think this article is particularly interesting due to the fact that it relates directly to what we did in class over the past few days and hits on money, inflation, and money supply.
The article was kind of eye opening in the fact that my reasons for supporting Bitcoin were contrasting with this author's reasons. In class we all tended to agree that the Bitcoin was an absolutely awful store of value due to its tendencies to rise and fall violently. We also agreed that it was a fairly decent unit of account if it would be more widely known. It isn't that hard to say a television is worth one Bitcoin. I did agree with the author in the fact that Bitcoin is a great medium of exchange. The author compares the Bitcoin to awesome gold. Basically, the Bitcoin is inflation proof because the "Bitcoin supply" in the global economy will only ever be 21 million BTC. Ever. It will never exceed that. For this reason, Bitcoin is deemed as an excellent store of value by the author. BTC is a solid medium of exchange due to its instantaneous nature and its security. Now, for the deal breaker for many economists: BTC is not a unit of account. You can't easily value a carton of eggs in terms of Bitcoin. For this reason the author believes that the Bitcoin will never beat the dollar. I'm not sure I agree with everything the author says, but I would love to hear what you think.
- David Gerhart
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