Ask any financial reporter about Bitcoin and they'll tell you it's all the rage these days. "Cryptocurrency," previously a term that had never graced the ears of the general public, now permeates the radio and television waves, and of course, the internet, on a daily basis. Last month, there were two back-to-back hearings in the United States Senate Homeland Security and Banking Committees to help legislators learn more about the emerging and exciting phenomenon of digital cash. Yet, as is the case with most things in life, Bitcoin is far more complex than its many advocates would have us believe. Consequently, the understanding held by most, including those in government charged with regulating virtual currency, appears to be lacking. And that's a serious problem.
To be fair, there's a lot to understand and much of it is fairly nuanced. Even as someone who has spent considerable time learning about computer software, with a specialty in digital financial systems and occasional forays into security and public policy, I don't think I grasped Bitcoin's implications until recently, when I actually took the time to sit down and read the original 2008 research paper authored by the ever-mysterious and reportedly pseudonymous Satoshi Nakamoto. It's possible that I don't grasp all of the technology's implications still. There is no doubt that Bitcoin is a brilliant academic thought experiment. But the media hype has carried the paper's tenets far from the academic realm, which raises more than a few questions.