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Wild, unregulated hacker currency gains following

April 11, 2013 • Business


In this April 3, 2013 photo, Mike Caldwell, a 35-year-old software engineer, looks over bitcoin tokens at his shop in Sandy, Utah. Caldwell mints physical versions of bitcoins, cranking out homemade tokens with codes protected by tamper-proof holographic seals, a retro-futuristic kind of prepaid cash. With up to 70,000 transactions each day over the past month, bitcoins have been propelled from the world of Internet oddities to the cusp of mainstream use, a remarkable breakthrough for a currency which made its online debut only four years ago. (AP Photo/Rick Bowmer)

LONDON (AP) — With $600 stuffed in one pocket and a smartphone tucked in the other, Patricio Fink recently struck the kind of deal that’s feeding the rise of a new kind of money — a virtual currency whose oscillations have pulled geeks and speculators alike through stomach-churning highs and lows.

The Argentine software developer was dealing in bitcoins — getting an injection of the cybercurrency in exchange for a wad of real greenbacks he handed to a pair of Australian tourists in a Buenos Aires Starbucks. The visitors wanted spending money at black market rates without the risk of getting roughed up in one of the Argentine capital’s black market exchanges. Fink wanted to pad his electronic wallet.

In the safety of the coffee shop, the tourists transferred Fink their bitcoins through an app on their smartphone and walked away with the cash.

“It’s something that is new,” said Fink, 24, who described the deal to The Associated Press over Skype. “And it’s working.”

It’s transactions like these — up to 70,000 of them each day over the past month — that have propelled bitcoins from the world of Internet oddities to the cusp of mainstream use, a remarkable breakthrough for a currency which made its online debut only four years ago. When they first began pinging across the Internet, bitcoins could buy you almost nothing. Now, there’s almost nothing bitcoins can’t buy. From hard drugs to hard currency, songs to survival gear, cars to consumer goods, retailers are rushing to welcome the virtual currency whose unofficial symbol is a dollar-like, double-barred B.

Advocates describe Bitcoin as the foundation stone of a Utopian economy: no borders, no change fees, no closing hours, and no one to tell you what you can and can’t do with your money. Just days ago the total value of bitcoins in circulation hit $2 billion, up from a tiny fraction of that just last year. But late Wednesday, Bitcoin crashed, shedding more than 60 percent of its value in the Login to read more

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