Three different people sent me the same kind of screenshot this week, a chart of a price line going up and to the right. My buddy Dave posted a screenshot of the Bitcoin price on Mt. Gox, my dad emailed me from his work account asking "is this an internet money thing, should I buy some," and someone on a forum thread I follow linked a chart with just the words "look at this."
That's how you know something's broken out of the tech-nerd bubble and gone properly mainstream-weird - when your dad emails you about it from his work account.
For anyone who's been ignoring this: Bitcoin, the peer-to-peer digital currency thing that's been kicking around since the Satoshi Nakamoto paper back in 2008, crossed the $100 mark on April 1st (not an April Fools joke, though I genuinely assumed it was when I first saw it) and as of this morning it's sitting somewhere in the $140s on Mt. Gox, which is the exchange most people are actually using. Three months ago it was trading under $15. I've been half paying attention to Bitcoin since 2011, when I first read about it on a forum and mostly dismissed it as a toy for people who wanted to buy weird stuff on Silk Road, which, lets be honest, was and probably still is a big chunk of the actual use case.
A lot of the writeups this week are pinning the spike on Cyprus, the whole banking mess a few weeks back where depositors got told their savings above a certain threshold were getting a haircut to help bail out the banks. Suddenly a currency nobody controls and no government can freeze started looking a lot more interesting to a certain kind of person with money sitting in a Mediterranean bank account. I don't know if that's the actual driver or just the story journalists like because it makes a tidy narrative, but the timing lines up close enough that I'm inclined to believe at least part of it.
I tried signing up for a Mt. Gox account Tuesday night, mostly out of curiosity, just to see what the process even looked like. Verification is still pending, three days later. Apparently they've been getting swamped with new signups and the queue is backed up, which if you've ever dealt with a startup scaling problem, you can guess what that implies about the trading infrastructure underneath all this. I'm not in a rush to put real money into something where the exchange itself might buckle. I've read enough stories about exchanges getting hacked or quietly vanishing with everyone's coins to not feel great about it.
The part that actually interests me more than the price is the mining side. There's a company, Butterfly Labs, that's been taking preorders for dedicated ASIC mining hardware, chips built to do nothing but compute SHA-256 hashes as fast as possible, and by all accounts they're way behind on shipping. People who ordered months ago are still waiting on their boxes, and meanwhile the mining difficulty keeps climbing every week as more people pile in. It's a genuinely strange little economy that's built itself out of nothing, and I mean that as a compliment, even though I remain unconvinced it survives the next couple years in any form resembling what it looks like right now.
Am I buying in? Probably not this week. Not because I think it's worthless, I honestly have no idea where the price goes from here, up or down, and neither does anyone confidently tweeting about it. It's more that I don't love the idea of moving actual money into an account that takes days to verify, sitting on an exchange that feels one bad afternoon away from a "we regret to inform our users" blog post. Maybe that makes me too cautious. Ask me again in a year and I'll tell you how wrong I was.
For now I'm just going to keep collecting screenshots from Dave, and the one email from my dad, which honestly might already be worth more to me than whatever a bitcoin is trading for by the time anyone reads this.