Bitcoin’s Silk Road

Mt Gox exchange rate for Bitcions vs US dollar

A recent Gawker article about online drug sales highlighted the virtual currency Bitcoin’s use in black markets.  Bitcoin has been on a roll lately, receiving publicity and raising awareness. That fact is reflected in the value of a Bitcoin vs the US dollar.  That’s a hell of an increase in a short time.

From Gawker:

“Bitcoins have been called a “crypto-currency,” the online equivalent of a brown paper bag of cash. Bitcoins are a peer-to-peer currency, not issued by banks or governments, but created and regulated by a network of other bitcoin holders’ computers. (The name “Bitcoin” is derived from the pioneering file-sharing technology Bittorrent.) They are purportedly untraceable and have been championed by cyberpunks, libertarians and anarchists who dream of a distributed digital economy outside the law, one where money flows across borders as free as bits.

Since it launched this February, Silk Road has represented the most complete implementation of the Bitcoin vision. Many of its users come from Bitcoin’s utopian geek community and see Silk Road as more than just a place to buy drugs. Silk Road’s administrator cites the anarcho-libertarian philosophy of Agorism. “The state is the primary source of violence, oppression, theft and all forms of coercion,” Silk Road wrote to us. “Stop funding the state with your tax dollars and direct your productive energies into the black market.”

There are a number of ways to get Bitcoins but one of the most sraight forward is to buy them on MT Gox. “Mt Gox is an exchange. It allows you to trade US Dollars (USD) for Bitcoins (BTC) or Bitcoins for US Dollars with other Mt Gox users. You set the price you want to buy or sell your BTC for. ”

As the general understanding of the failings of fiat currencies increases, alternate currencies have received a lot of interest.  Many people have decided to buy gold or silver, either through paper holdings in ETFs or in actual physical. Bitcoins represents a similar hedge although of a completely virtual nature.

Confessions of a Bitcoin trader – Reddit:

“Well, there is certainly money to be made in trading. Like I said, I made my first large purchase of bitcoins back when it cost about 20 cents per bitcoin. BTC prices are currently hovering around $10, thats a huge increase.

Its actually very easy to get set up, just download the bitcoin program and run it. The most difficult part is purchasing your first lump of coins. People won’t know you, and thus, won’t necessarily trust you right off. Paypal/CC transactions are risky for people selling to you since you can charge back the amount just by saying your card was stolen etc.

Bitcoin prices fluctuate wildly, so I don’t know that I would call them ‘stable’. We’ve been fairly lucky that they’ve just gone up in value over time. Eventually, we all kind of expect the US Government to step in and try and shut down the whole thing, at that point in time the prices will probably steeply decline. However, bitcoins are kind of here to stay IMO.”

From the comments: blockexplorer.com

“Bitcoin Block Explorer allows you to easily view information about the blocks, addresses, and transactions created by Bitcoin. It uses the getblock patch by jgarzik, but also does a ton of processing to make certain tasks, such as tracking transactions, easier.”

Real time tools here.

About Daniel Davenport

Daniel is a digital media executive with internet and broadcast experience. Daniel is currently the executive strategy director at THINK Interactive.

5 Responses to “Bitcoin’s Silk Road”

  1. “…[p]urportedly untraceable” is incorrect. Every transaction and bitcoin is accounted for. Check out blockexplorer.com and learn a little about it. There is a level of psuedo-anonymity, but bitcoins are not completely anonymous.

Trackbacks/Pingbacks

  1. Bitcoin doubles in weekend trading | thinkd2c - June 6, 2011

    […] at the price on Thursday when it was trading around 10, up from the 8 or so jump after the Gawker article.  I decided I would get ready,  see what happened and either way buy today.  Until I checked the […]

  2. Bitcoin: goes mainstream, breaks $31, bounces off $10 | thinkd2c - June 13, 2011

    […] was pointed out in a commenter to one of my first Bitcoin posts, Bitcoins are traceable: “…[p]urportedly untraceable” is incorrect. Every transaction and […]

  3. Bitcoin virtual currency may be the worst of both worlds — Tech News and Analysis - June 15, 2011

    […] perhaps, a couple of senators aren’t happy with the way such a system can be used to buy and sell drugs and other illegal items over the Internet, something that has also torpedoed previous attempts to […]

  4. Bitcoin virtual currency may be the worst of both worlds | TechDiem.com - June 16, 2011

    […] perhaps, a couple of senators aren’t happy with the way such a system can be used to buy and sell drugs and other illegal items over the Internet, something that has also torpedoed previous attempts to […]

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s

%d bloggers like this: