The future of the economy? It's the Bitcoins, the money ... virtual


How do you get out of the economic crisis? And will the internet be useful this time too? The economic experts are discussing it. And indeed, interesting ideas are emerging that could revolutionize the way we think about money and the economic transactions it involves. Such as? For example with virtual currency. Bitcoin.

Bitcoins are coins that exist only within our computers and in the network. They are already used to buy software, books, electronic tools. But unlike money, they are based on a distributed network, without central banks, and where anyone can control the flow and even the program (which is open source) that handles transactions.

Created in 2009 by the Japanese Satoshi Nakamoto (which according to some actually corresponds to a group of people), it currently has a value of over 7 million dollars.

The traditional economy tends to consider the stall phases as temporary. If growth is at a standstill right now, say the top experts, it is only because we are in a particular situation, but that it is destined to end. The tools for going out and resuming, according to this philosophy, have been the same for about a hundred years: reduction of public spending, incentives to companies, incentives to the stock exchange, and investments in public capital. The crisis, according to the new generation of economists, is not temporary but structural. It depends on a system that can no longer hold up. If money, according to some, is in a sense a means of communication, the information age cannot but change it.

It is no coincidence that at the Chaos computer camp, the meeting of hackers and computer experts held in Berlin in mid-August 2011, a conference is devoted to this topic.

Here the video. The nineteenth-century industrialist scheme, based on raw materials that are running out, like oil and gold, and above all managed by an increasingly sick and centralized finance, must necessarily be transformed. Virtual coins such as bitcoins (there are also Freecoin and Flattr) provide for the possession and anonymous transfer of coins through a peer to peer structure, which is able to check for tampering or attempts to inflate the currency, or to use it twice.

Coin generation, in fact (called mining), depends on the computing power of the computer that each user can add to the network by connecting to it, just as it was in the Seti @ home program for the search for extraterrestrial life forms. But the quantity is regulated by the network in its entirety. The number of bitcoins is in fact limited in time because it is divided between all the nodes based on their calculation capacity. With the increase in bitcoins in circulation, generation requires more and more computational power. The total is set at 21 million.

The advantages? According to those who are already using it are: lower transaction costs that could allow sellers who will use it to be more competitive on the market, creating a door-to-door system, without intermediaries and speculators, control carried out directly by users, more economic fundamentals solid (for example it is difficult to create inflation).

Obviously the system is still too young, but it could still be subject to speculation, or fraud that eliminates the value of coins, but success will also depend on the number of people: the bigger the virtual currency will have the chance to stabilize.

[This article was previously published in the Focus TecnoZapping blog)