Trying Out Bitcoin
Today I decided to give Bitcoin a try – thought I would share some initial thoughts from a newbie perspective. Many of my readers are probably ahead of me on this so can skip reading, but note that you can now donate me some Bitcoins to play with… please. :)
I’ve read some of the papers on Bitcoin but haven’t actually tried it til now. I’m not a wealthy person by any means so I don’t play with money much except for essentials, but I figured it was time I tried it. I’m glad I did – it’s interesting to see how it’s handled and some of the services springing up around it.
If you’ve never tried it, I strongly recommend freeing up a little cash and giving it a try. If nothing else, it’s cool to learn about, and it’s cool to handle a crypto-currency first-hand, a currency that isn’t centrally controlled. You really do ‘own’ it. You can be like me and not take it too seriously. Would I invest huge amounts in it even if I had it? Probably not. While the concepts are sound, it’s still experimental in the real world, and the central banking thugs will probably find ways to attack it, from theft to attempts at regulation. But I think it’s great to get to know it in a hands-on way.
The recent MtGox theft seems to have frightened some people, but I say “duh!” To me the whole point of a crypto-currency is distribution. Hold it in your own hands (PC). If you keep your coins in someone else’s possession, essentially a bank, you’d better hope they have good vaults and aren’t thieves, and to me that defeats the purpose. From what little I know of it, MtGox was a good lesson on how not to use crypto-currency. And I think that Bitcoin survived that heist says a lot. It was basically a bank robbery – shows it has real value. :)
So I discovered a few services. Coinbase is sort of like Paypal for US customers, you can buy Bitcoins by transferring US dollars from a bank account, and can receive Bitcoins from a Donate button like the one I now have here on the blog, and can then convert them back to dollars in your bank account. No fees involved, and some of the people from Paypal seem to be involved. Reviews are mostly positive. (There is a lot of FUD on Bitcoin in general, so read deeply – TPTB don’t want you using something they can’t control.)
To me though, it’s less interesting to see everything in terms of exchange rates, and just work with Bitcoins themselves as a means of exchange. I just need to get some to try it out a bit, so currency conversion is a starting point. I think the whole racket of trying to make money by selling high and buying low is useless, as it is in general. Try providing real services instead of just milking the system. Yet given the number of people trying to play it like a scam, Bitcoin has held up well. Regardless of exchange rates, 1 BTC == 1 BTC, and that should remain true for quite some time. I think it’s cool to own a few.
I’m also trying out the Electrum python-based client for Linux, right in Debian’s repos. Looks pretty well designed, and people seem pretty well-informed in the community. But I don’t have any BTC yet so it’s kind of boring. MultiBit is popular too, but Java is a turn-off for me. The advantage to using your own client is that it’s like holding cash in your wallet – you’re not going through a bank or central service. It’s as secure as your computer in general, which is good enough for something at least. No currency is guaranteed – it’s only money, people. Use it to exchange some stuff, but don’t obsess over it in any form. Keep it real.
There are other digital currencies, but from what I understand not many are like Bitcoin – they are centrally controlled and can be printed at will, etc. Bitcoin is based on some sound mathematics. Even if it doesn’t survive, I think it’s worth being part of, at least in a small way, even as a global experiment that may evolve into its successor. It has an exciting feel to it and people seem to be enjoying learning about its ups and downs.
For those who don’t know, much human suffering has been created by centralized banking – the banksters who rob and control whole nations. I think the concepts of crypto-currency deserve participation for what they can become. Actually quite a few online stores and brick-and-mortar stores are accepting Bitcoin now. The merchant services are becoming streamlined. I think the services are worth exploring and using in limited ways, but learning how to use a client like Electrum and maintaining your own wallet directly is worth learning too – it’s easy.
So I hope you give Bitcoin a try with me for the experience itself, and don’t believe all the FUD – the Bitcoin FAQ is a good read. It’s actually a pretty cool thing. No, it won’t make you rich, and yes, it’s somewhat unstable in terms of exchange rates. But it is what it is, and it seems to have a solid start. I’ll let you know how I’m doing with it, and feel free to share your experiences.