$1,000 Bitcoin: what people are saying

on November 27, 2013

In a few short months, Bitcoin has gone from novelty to full-blown mania. In the last month alone, the virtual currency blew through the $400 and $700 mark and charmed Washington DC. Now, it has risen over 6 percent in the last week and cracked $1,000 on a popular exchange. This tweet sums up the price:

The $1,000 hype has led to a spirited discussion on sites like Hacker News where some people suggest the price is heading ever upwards:

All else being equal, the more people who decide to use or hold Bitcoin, the higher its price will be, because the maximum number of bitcoins that can ever exist is permanently fixed. It’s a scarce commodity by design.

Others, of course, are more skeptical and think something else will happen:

You should take into account that if things go as usual, there will probably be a crash in the next few days, leaving the price around $500 for a while.

Inevitably, there have also been stories comparing Bitcoin to South Sea Stock and tulips.

Bitcoin hitting a $1,000 is also triggering pangs of regrets, including among those who bought a pizza that was worth $750,000 in May (and now much more). But the saddest story so far is the man in Britain who amassed 7,500 Bitcoins on his laptop — and then threw the laptop away!

The serious finance crowd, meanwhile, has detected another trend in the wake of $1,000 Bitcoin: a knock-on explosion in other virtual currencies. Dealbook looks at the effect on LiteCoin, Ripple and something called PeerCoin, while the Financial Times pours some cold water on the whole thing:

When things get too expensive, imperfect substitutes become increasingly appealing. It happened to oil with natgas and shale. It happened to gold with copper and silver. Now it seems to be happening with Bitcoin as well.

The Winklessvoss twins — two of the largest Bitcoin holders — by the way, recently said that virtual currency is a winner-take-all and that Bitcoin will not just prevail but will rival gold as it reaches $40,000.

Companies, of course, are seizing on the Bitcoin buzz:

Marketers, meanwhile, are flooding this reporter’s in-box with “Black Friday Bitcoin!” stories, offering opportunities to talk to bakeries, bars and every other stripe of business that wants to get some notice by accepting Bitcoin. You can find a sampling of discounts — on everything from Reddit Gold to travel to t-shirts — here.

Finally, on Bitcoin’s unofficial second anniversary, the identity of the currency’s creator, remains a mystery. The latest attempt to unmask him this week led cryptographer Dustin Trammell to publish an emphatic blog post titled “I am not Satoshi.”