Mr. Stoll, writing in Reason Magazine just two weeks ago about his libertarian love for Bitcoin:
To me the Bitcoin phenomenon illustrates at least two important concepts: competition is good, and technology moves faster than lawmakers or regulators do.
America is all about virtuous competition. Think of Harvard and Yale, the New York Times versus the Wall Street Journal, Apple’s iPhone versus Google’s Android mobile operating system, Macintosh versus Windows, Coke versus Pepsi, McDonald’s versus Burger King, Red Sox versus Yankees. If things work the way they are supposed to, the healthy competition drives improvements and efficiencies that benefit consumers and shareholders.
As things stand today, the dollar has some competition as a store of value and as a medium of exchange from other commodities, assets, and currencies, such as gold, the Euro, and the Yen. As a new competitor, Bitcoin may help to keep the custodians of the dollar on their toes.. .
. . . The cashless economy, once a techno-utopian dream, is now approaching reality. Even Hillary Clinton’s spokesman Philippe Reines was recently quoted about how he hadn’t withdrawn any cash from the bank since June 2012.
There are a whole variety of ways that Yellin may want to break with Bernanke’s legacy at the Fed. But one point where continuity might inspire confidence would be if she were to convey that she shares his view that digital currency is a potentially promising development rather than a dangerous threat to the dollar’s monopoly.
Wonder what Mr. Stoll will have to say about this development:
The most prominent Bitcoin exchange appeared to be on the verge of collapse late Monday, raising questions about the future of a volatile marketplace.
On Monday night, a number of leading Bitcoin companies jointly announced that Mt. Gox, the largest exchange for most of Bitcoin’s existence, was planning to file for bankruptcy after months of technological problems and what appeared to have been a major theft. A document circulating widely in the Bitcoin world said the company had lost 744,000 Bitcoins in a theft that had gone unnoticed for years. That would be about 6 percent of the 12.4 million Bitcoins in circulation.
While Mt. Gox did not respond to numerous requests for comments, and the companies issuing the statement scrambled to determine the exact situation at Mt. Gox, which is based in Japan, the news helped push the price of a single Bitcoin below $500 for the first time since November, when it began a spike that took it above $1,200.
Update/Revision: So, Mr. Stoll, might there not also be a downside to technology that moves faster than lawmakers or regulators do?
Incidentally, the timing of this news could not have been worse for fans of virtual currency, as a deal is apparently in the works to create a new market for such currency with involvement from some major banks.