DailyDirt: Do You Trust Digital Currencies?

from the urls-we-dig-up dept

Tue, Apr 16th 2013 5:00pm — Michael Ho

Global financial markets have shown that respectable currencies can be threatened by the actions of relatively small economies. The basis of modern money is trust, not the value of gold or of any particular physical goods. Perhaps digital currencies could provide some alternatives for small countries (who shall remain nameless, cough, Cyprus, cough, Luxembourg...), but there's still a problem of trust to resolve. It's not always easy to just switch to a new currency. Here are just a few forms of digital money that might be floating around.

Amazon Coins are yet another virtual currency -- specifically for buying virtual goods on Amazon's Kindle tablet. One Amazon Coin is equal to the value of a US penny, and everyone will soon be collecting them, so get them before they're all gone.... [url]
Flooz.com officially shut down in 2001, putting an end to its digital currency that was used on the internet as an early kind of electronic gift certificate. Thousands of people had bought Flooz (at an exchange rate of 1 USD to 1 Flooz), but the company had also sold ~$300,000 worth of Flooz via fraudulent credit card transactions, which ultimately doomed the company. [url]
Bitcoins are still getting attention, even after some serious missteps, but the market for Bitcoins isn't quite trustworthy yet. If Bitcoins do succeed in gaining mainstream use, will there be a flood of digital currencies based on a variety of different cryptographic rules? [url]

If you'd like to read more awesome and interesting stuff, check out this unrelated (but not entirely random!) Techdirt post via StumbleUpon.

Thank you for reading this Techdirt post. With so many things competing for everyone’s attention these days, we really appreciate you giving us your time. We work hard every day to put quality content out there for our community.

Techdirt is one of the few remaining truly independent media outlets. We do not have a giant corporation behind us, and we rely heavily on our community to support us, in an age when advertisers are increasingly uninterested in sponsoring small, independent sites — especially a site like ours that is unwilling to pull punches in its reporting and analysis.

While other websites have resorted to paywalls, registration requirements, and increasingly annoying/intrusive advertising, we have always kept Techdirt open and available to anyone. But in order to continue doing so, we need your support. We offer a variety of ways for our readers to support us, from direct donations to special subscriptions and cool merchandise — and every little bit helps. Thank you.

–The Techdirt Team

Filed Under: amazon coins, bitcoin, currency, digital cash, flooz, money

12 Comments

If you liked this post, you may also be interested in...

Reader Comments

The First Word

“

I trust digital currencies like Bitcoin and Litecoin. I just don't trust speculative markets and weakpoints of centralization like MtGox. For the foreseeable future the methodology behind Bitcoin creation and transactong is very robust, and that is what reporters should be discussing. In the interim, Bitcoin will see many booms and busts until an infrastructure to support it is in place, for normalized commerce we will see a lot of volatility.

As to amazon coins and other such things, those are little better than gift cards, but who knows what they might evolve into.

—joe

”

Subscribe: RSS

View by: Time | Thread

Anonymous Coward, 16 Apr 2013 @ 5:08pm

mining bitcoins takes energy and resources!
http://arstechnica.com/business/2013/04/mining-bitcoins-takes-power-but-is-it-an-environmental-disas ter/

But how does bitcoin mining compare to mining for gold or other metals? I would think much more favorably than diamonds or other commodities, too.
[ link to this | view in chronology ]
- Aaron Toponce, 16 Apr 2013 @ 5:44pm
  
  Re: mining bitcoins takes energy and resources!
  Depends on its value and who is footing the power bill for you to do the mining.
  [ link to this | view in chronology ]
Anonymous Coward, 16 Apr 2013 @ 5:40pm

Do You Trust Fiat Currencies?
I do not.
[ link to this | view in chronology ]
joe, 16 Apr 2013 @ 6:06pm

I trust digital currencies like Bitcoin and Litecoin. I just don't trust speculative markets and weakpoints of centralization like MtGox. For the foreseeable future the methodology behind Bitcoin creation and transactong is very robust, and that is what reporters should be discussing. In the interim, Bitcoin will see many booms and busts until an infrastructure to support it is in place, for normalized commerce we will see a lot of volatility.

As to amazon coins and other such things, those are little better than gift cards, but who knows what they might evolve into.
[ link to this | view in chronology ]
Anonymous Coward, 16 Apr 2013 @ 10:47pm

I hope Bitcoin works out. I'm tired of paying $0.50 to Paypal for every book I sell.
[ link to this | view in chronology ]
- anonymouse, 17 Apr 2013 @ 3:46am
  
  Re:
  I am also one who hopes Bitcoin works out but at the moment the fluctuation in value is very high. I would have lost a lot of money if i had invested in bitcoins over the last few months as their value dropped by around 50%. Hopefully these fluctuations will become less and less and will result in a very stable currency. Maybe even one where people can use it for the majority of their transactions and as you say stop places like paypal ripping people off.
  [ link to this | view in chronology ]
Anonymous Coward, 16 Apr 2013 @ 11:24pm

I trust things that have value.
Paper or plastic in the case of Canada has limited value.
As to the faith and credit of any thing, lol look at what's going on in Greece/Cyprus, what will soon happen in the USA.
Soon the only thing that will have value are ammo cartridges.
[ link to this | view in chronology ]
- Anonymous Coward, 17 Apr 2013 @ 2:39am
  
  Re:
  and bottle caps
  [ link to this | view in chronology ]
  - Anonymous Coward, 17 Apr 2013 @ 4:50am
    
    Re: Re:
    Austerity has consequences
    [ link to this | view in chronology ]
Zakida Paul (profile), 17 Apr 2013 @ 1:05am

I don't trust traditional currency because of the way it is now created, why would I trust digital currency?
[ link to this | view in chronology ]
- John Fenderson (profile), 17 Apr 2013 @ 4:36pm
  
  Re:
  I wanted to express the same sentiment, but you put it into better words than I could come up with. So, I'll just say "me too."
  
  Me too.
  [ link to this | view in chronology ]
Denial, 21 Mar 2019 @ 12:59am

According to the statistics of bitcoin and many other currencies from the site https://usd.mconvert.net/aud to trust them this year is not worth it. As for Amazon Coins-I like how this company is developing, and I think in the near future this currency will not change in price
[ link to this | view in chronology ]