The Dark Power of Bitcoin

While this project is currently in beta, it’s actually a game changer. A scary one.

Bitcoin itself is an open source project where a currency bartering system was created based on P2P. A completely self-sustaining currency where there is no centralized system and everything is based entirely on the algorithm in which creates the bitcoins and the distribution. The fact that there’s an underground market for this, and that apparently there are people that are some stories of people using it as tender for illegal activities makes it entirely interesting.

The way each bitcoin is made seems to be along the same lines as [email protected]. Processing power is used to compute blocks, where when the blocks are assembled, it creates a bitcoin at random. Probably not entirely correct, but it’s enough to go on.

The biggest change here is that while governments can ban the use of bitcoin, they can’t really control the actual flow of money. Since it’s headless P2P, there really is no way to track the movement of the bitcoin transactions alongside the fact that you can’t tax it, or anything. The entire currency is hard to break down since it’s virtual and in essence, it could start an entire black market trade if it truly became banned. On top of this, the algorithm is an open one (considering the project is released under MIT license) but the amount of power to compute the entire thing is completely ridiculous to try to game the system or mine for more “money”.

All in all, this project was brilliantly conceived and scary in the same breath. I so want to actually give it a test run, but you know that the government at some point will turn their eyes on this. And the moment that happens, everyone will fall into a net of some sort if you have a connection. Thanks but no thanks. Irregardless, it’s one of the few currencies in the world right now that actually has some value to it instead of drawing up some random paper and assigning values to it. Consider this: this is the only currency that requires power to generate it in the sense of the energy spent in CPU processing. No other currency has that sort of value outside of commodities. Food for thought.

(h/t to Jason on the project itself)