When it comes to any finance-related questions, I am fair game, and those questions usually span the spectrum, from what I think about Warren Buffett
(or why I don't agree with everything he says) to whether tech stocks are in a bubble (a perennial question for worry warts).
In the last few months, though, I have noticed that I have been getting more and more questions about crypto currencies, especially Bitcoin and Ether, and whether
the price surges we have seen in these currencies are merited. I have generally held back from talking about crypto currencies in this blog or in my other teaching
for two reasons. First, I find that any conversation about bitcoin quickly devolves into an argument rather than a discussion, since both proponents and critics tend
to hold strong views on its use (or uselessness). Second, I find that some of the technical underpinnings of bitcoin, either and other cryptocurrencies are beyond my limited
understanding of block chains and technology and I risk saying something incredibly ill informed. While both reasons still persist, I am going to throw caution
to the winds and put down my thoughts about the rise, the mechanics and the future, at least as I see it, of crypto currencies in this post.
The Market Boom
Any discussion of crypto currencies has to start with the recognition that the experiment is still young.
Satoshi Nakamoto's paper on bitcoin was made public in October 2008 and implemented as open source in January 2009.
Less than ten years later, the market capitalization of bitcoin alone is in excess of $40 billion and the success story,
at least in terms of bitcoin as an investment