Bitcoin still not used as mainstream currency

Anne Daugherty

Students spend money in thousands of ways each day on campus — using Dine In Dollars, credit cards and cash — but few have used, or even heard of, a digital currency called Bitcoin. 

Some members of The Mises Circle, a UT student roundtable organization that promotes Austrian economics, held a conference Monday to promote awareness of the phenomenon. Jeffrey Tucker, executive editor of Laissez Faire Books and a prominent advocate for Bitcoin, led the discussion remotely through live-stream video.

Bitcoins are a decentralized digital currency, not bound to any particular government. They debuted in 2009 but are not used as a mainstream currency. Currently, there are roughly 11.5 million bitcoins in circulation.

Tucker explained that when bitcoins first came out, few people accepted them as currency and they were almost useless — but he said they are becoming more popular with each passing year. Tucker said one of the reasons for their increasing popularity is that they are not subject to third-party transaction fees.

Nearly 4,500 companies now accept bitcoins as payment, and some merchants accept bitcoins in purchases of gift cards for mainstream companies, such as Amazon.

Computer science senior Michael Goldstein, co-founder of The Mises Circle, said bitcoins can offer certain protection that credit cards cannot.

“They are more secure than credit cards because when you do a bitcoin transaction, there is no identity attached,” Goldstein said. 

Goldstein also said there is no need for a physical address or bank account number, as there often is with regular online purchases.

Because bitcoins operate independent of any recognized government body, they are not regulated like traditional currency. In April, the value of a bitcoin dropped more than $100 over the course of a single day. In the two years since bitcoins were launched, they have ranged in value from $2 to $266.

Finance senior Alan Rochard said he was interested in studying and learning more about the international implications of the Bitcoin system.

“It is much easier for international corporations to use because there is less need for converting currencies,” Rochard said.

Tucker said at the video conference that he is hopeful about the future of the digital currency.

“The bitcoin is designed for the Internet age,” Tucker said. “We are doing things on the Internet that are part of the future, yet we are still using currency from hundreds of years ago.”