Where else but in Las Vegas is it fitting for Bitcoin to be debated? Hundreds, mostly, male, took notes feverishly on mining and investment process of Bitcoin, the controversial digital currency. They are attending this week the conference; Inside Bitcoins: The Future of Virtual Currency, reported the USA Today.
This ‘is the Woodstock of Bitcoin,' says Robert Brewster, CEO of Whidbey Wasabi, a farmer of wasabi outside of Seattle. ‘I was skeptical until a skateboarding friend of mine put his last $10,000 on Bitcoin and made $90,000. It changed his life.’
The crowd showed their love for Bitcoin while jeering the banks and credit card issuers.
Are bitcoins a super currency or super fad?
‘(This year), Bitcoin will be the single-biggest sector for venture capital investments,’ Brock Pierce, managing director of Clearstone Global Gaming, said to whoops and hollers. Pierce, former child actor (Mighty Ducks) has made a small fortune investing in Mastercoin Foundation, which lets people create their own cryptocurrency using the Bitcoin computing protocol.
"Now, it's a commodity; soon, it will be a phenomenal currency," says James Beshara, CEO of Crowdtilt, a crowd-sourcing mobile platform that accepts digital currency. (Thousands of online vendors accept Bitcoins as payment.)
Entrepreneur, Jeremy Allaire made headlines when started Circle Internet Financial, which delivers digital currency as a payment tool. Allaire testified Nov 18 before the Homeland Security and Government Affairs Committee hearing on Bitcoin and stated: ‘represents one of the most important technical and economic innovations of our time and that it helped to advance the ease of electronic payments and money transfers while lowering costs for businesses worldwide’.
Outgoing Federal Reserve Chairman, Ben Bernanke praised the technology in a recent letter to the Senate Hearing Committee. Former Federal Reserve Board Chairman, Alan Greenspan does not support Bitcoin.
Bitcoins have had their dark side and bad press due to criminal activities; the most notable has been the ‘Silk Road’ online money drug trader and murder for hire site. The FBI after two and a half years of hunting down the owner of the site closed it down and arrested its owner last Oct. Within weeks a new ‘Silk Road’ opened online.
"Criminals have been using Bitcoins since Day One because of the anonymity — it is hard to trace," says Stay Major, fraud prevention solutions manager at Trustier, an IBM company. In a recent report, Trustier detailed how cybercriminals are leveraging the Bitcoin boom, and how hackers target it.
This past week Merrill Lynch jumped on board the Bitcoin fan club seeing Bitcoin's potential among investors, Bank of America Merrill Lynch became the first major bank to initiate coverage. It says the currency can become a "major means" of payment, and placed its value at $1,300 per Bitcoin – with a maximum market capitalization of $15 billion.
This came days after the China warned that Bitcoin carried considerable risk and instructed its financial institutions not to trade it.
The currency is based on a deflationary concept: A limited supply of no more than 21 million coins, whose value does not drop easily.
‘It's how money should work in an electronic world,’ says Lawrence Lenihan, managing director of FirstMark Capital, which focuses on investments in e-commerce and other fields. ‘It removes friction, it destroys barriers, and it enables opportunity. You'll see it first disrupt remittances and money transfer and then it will move to commerce and payments. From there, the uses will explode in ways I don't think we can even fully understand at this point.’
Bitcoin has an incredible advantage over credit cards. It does not require name, address, financial information; it requires only an email address. There are several sources, such as BitPay and Coinpay, now that process Bitcoin for payment for merchants, who find the ease and reduced cost of their merchant services significant against credit card processing fees of interchange cost, transaction cost, statement fee, compliance regulatory fee and issues of risk review for large transactions with the bank backing the credit card processing.
Bitcoin is a winner in Las Vegas this week!