A parallel world

My newspaper – an unimpeachable source of truth, objectivity and honesty, with no connection to current events at the Old Bailey, relates the following: “Norwegian buys a flat for nothing “. This story refers to the existence of an unsuspected world of commercial transactions the nature of which – unless it is already familiar to the more sophisticated members of this forum – I could not ever have imagined.

There ‘exists’ a virtual currency, a cyber currency used for ordinary every day, commercial transactions. This currency is called a Bitcoin. A Norwegian gent by the name of Kristoffer Koch bought Bitcoins to the value of 150 Kroner (£16) then forgot about them for around four years.

Koch then bought a further 5,000 Bitcoins in 2009 and then forgot about these until April this year when he discovered they had ‘appreciated’ to a sterling value of just under £450,000 (Yes, I put the noughts in the right place!) He then cashed in part of his newly acquired wealth (£116,000) and bought an apartment.

The story goes that Bitcoins can be exchanged for ‘real’ money or be used to buy goods and services online. Users of Bitcoins are attracted because transactions are anonymous and not controlled by any central bank or organisation. Bitcoin value can wildly fluctuate.

Reading this, my incredulity took wing. Does anyone know anything about this astonishing but on reflection, unsurprising development ? It is of course an out and out gamble – someone’s gain is someone’s loss etc.

I did look at the date of the paper to check as to whether April 1st hadn’t come early.

I can see the flaw or, one of them; If the Bitcoin looks like becoming too popular, the attention of Govt. agencies will focus and manipulation will take place to insert instability into an already volatile situation.