Special guest Ken joins us to discuss the use of ripple. Bitcoin over $200 to stay? Zerocoin, what is it? What does the future hold for bitcoin?
The person or people claiming the name Satoshi Nakamoto solved a difficult problem. There was a certain amount of creativity required, and a simplistic beauty in the solution. Like many times when a elegant solution is announced, more problems become apparent. It is the very nature of solutions that they expand what people can think about and hence lead to more unanswered questions. In this way, the chain of discoveries progresses on.
Satoshi is not immune to this process of answers leading to more questions. We have seen the successful implementation of Bitcoin, which has led to more problems. One such problem is that fees for transactions are static and not dynamically adjusted as demand for block space or market conditions change. Another such problem is blockchain bloat, which every user that downloads the reference client experiences as they loose over seven gigabytes of free space on their hard drive. Another problem is that unsuspecting users get very small payments many times, these payments can’t be spent as they will not cover the fee of a transaction that will be several kilobytes in size. Of course, there is a viewpoint that these are not problems at all, but rather suboptimal solutions.
Markets reacted as expected today except for news broadcast by the CME group. As we discussed on our most recent podcast. Bitcoin market rose Monday morning in response to the opening of the legacy banking system. Somewhat surprising the rally seems to be led by buying with US dollars. Only moderate volume is reported on btcchina.com.
Gold buying in Asia seems to remain strong. The US paper gold markets took a little dip brought on by the CME group announcement of increased margin requirements on copper. This probably encouraged selling of gold to cover copper positions.
CME group increasing margin requirement: http://www.kitco.com/reports/KitcoNews20130506AS_copper.html
This is an exciting episode. Current issues are discussed including Coinlab and mtgox’s likely court battle, Max Keiser’s battle with the bankers, the proliferation of alternate chains. A breakdown of China’s state television broadcast involving bitcoin is discussed. Jerry even stops buy to discuss his well-meaning adventures on the bitcointalk.org forum. The uncertainty of the current economic state of the world including central banks reaction with Quantitative easing. It’s never a dull week when considering finance and bitcoin.
On Friday China Network Television aired a 25 minute report on bitcoin in China. This report included topics such as buying, mining, trading, buying and the price. There’s a point of sale transaction and even an American who explains how it’s easier to get US dollars in his account with bitcoin then with the traditional financial system.
After this exposure there has been a spike in search volume at the popular Chinese search engine Baidu. Reaching a level of over double the previous maximum. China now is the country with the most downloads of the bitcoin client in the past week. The full effect will not be felt until Monday or Wednesday of next week as the traditional banking system is slower to react. Bitcoin is currently trading at 720 Chinese Yuan about the equivalent of US$117 at BTC China. This is compared to the price of $112 at MtGox.