Bitcoin Hits the Big Time, to the Regret of Some Early Boosters

By Tom Simonite on May 22, 2013. The first major conference for the digital currency suggests it is gaining legitimacy, but in a manner disappointing to some early enthusiasts.

This past Sunday, Doug Scribner took out five $100 bills and began feeding them into what looked like a small, white ATM in San Jose Conference Center in California. The machine swallowed the bills smartly and credited him with an equivalent value in bitcoins, an intangible, digital currency that is backed by not gold or any government, but by math.

Scribner was one of an estimated 1,100 people who attended Bitcoin 2013, a weekend-long event in the heart of Silicon Valley and the first large conference dedicated to Bitcoin. Unsurprisingly, all those present seemed certain that the cryptocurrency was set to upend the world of finance, perhaps more. But the event also offered something new: evidence that Bitcoin is gaining traction outside its existing community of enthusiastic early adopters.

Bitcoin’s origins are mysterious. It was created by an unknown individual or individuals who used the pseudonym Satoshi Nakamoto. Cryptographic operations and oversight from a peer-to-peer network of people running Bitcoin software process transactions and protect against counterfeiting without the need for a central authority (see “What Bitcoin Is and Why It Matters”).

Commercial enterprises based on Bitcoin are gaining momentum in part thanks to people like Scribner, who, after buying large numbers of bitcoins early in their short history, has seen them soar in value and is in a position to invest. “I’m going to buy one of these and put it in Mall of America,” Scribner told me after using the dollar-gobbling machine, which has a $4,000 price tag. He described a plan for a small booth that would offer passing shoppers Bitcoin literature and the opportunity to exchange greenbacks for bitcoins on the spot. Scribner, who works in teleconferencing near Minneapolis-St. Paul, Minnesota, could probably afford to do it. He says that he bought his first 100 bitcoins when they were just $3 each, and then steadily amassed more at relatively low prices. A single bitcoin today now sells for just over $120. - Read more here: http://www.technologyreview.com/news/515061/bitcoin-hits-the-big-time-to-the-regret-of-some-early-boosters