I've had a Mt. Gox tab open in my browser since about nine this morning, which is not a good sign for how much actual work I'm getting done today. Every twenty minutes or so I flip back to it like it's going to tell me something different than it told me last time. It never does. The number just keeps creeping up.
If you haven't been following it, Cyprus is in the middle of a genuine bank crisis. Not "stocks are down" crisis, an actual "the banks are physically closed and nobody can get their money out" crisis. As part of the EU bailout terms, there was a proposal a week or so back to slap a one-time tax on ordinary deposit accounts, something like 6.75% on anything under 100,000 euros and closer to 10% above that. People lost their minds, understandably, and the Cypriot parliament voted it down on Tuesday, 36 to zero, with the rest abstaining. Nobody voted for it. But the banks are still shut, and nobody's entirely sure when they're opening back up or what happens to anyone's savings when they do.
I'm not going to pretend I understand EU bailout mechanics well enough to explain the rest of it, and honestly a dozen finance blogs are doing that better than I could this week anyway. What I do find interesting, from the tech-nerd corner of the internet where I live, is watching bitcoin react to it in close to real time.
The price has been climbing pretty much all week. It was sitting somewhere in the low forties a couple weeks ago and this morning it was creeping past sixty dollars a coin, which is the kind of move that gets people who've never mentioned bitcoin in their life suddenly very interested in bitcoin. The logic going around is straightforward enough: if your government can reach into your bank account and take a cut whenever it decides it needs to, then maybe having some of your money in something no government controls starts looking a lot more appealing. Whether that logic actually holds up is a different question, but it's clearly moving the price.
I've got a small handful of coins sitting in a wallet from back when I ran a miner on my laptop for about three weeks in late 2011, mostly out of curiosity, and mostly because it made an interesting whining noise and warmed my desk up in a cold apartment. I stopped when I did the math on the electric bill versus what the coins were worth at the time, which was basically nothing. I never got around to deleting the wallet file though, and it's a genuinely funny feeling to open it up this week and see a number that isn't zero. I'm not selling. I'm also not buying more. I've watched this community online long enough to know the "safe haven from government overreach" pitch shows up every single time there's bad financial news somewhere in the world, and the price always seems to come back down eventually once the news cycle moves on. Maybe this time is different. People keep saying that.
What I do think is worth sitting with for a second, separate from whether bitcoin itself is a smart bet, is how strange it is that a currency with basically no institutional backing, no central bank, no government behind it at all, can function as a pressure valve when people lose trust in the institutions that are supposed to be backing their money. That's not really a story about technology so much as it's a story about trust, and it happens to be playing out on infrastructure a bunch of us built for fun a few years ago.
Also, completely unrelated, I still have that Google Reader announcement tab open too, the one from last week saying they're shutting it down in July, and I have made zero progress on figuring out what I'm migrating my feeds to. One crisis at a time I guess. The bank thing at least isn't my problem to solve.
Anyway. Back to refreshing the ticker.