Thinking of ‘Bitcoin’

Thinking of ‘Bitcoin’

 

Now, budding old cherry tree

* This article is an English translation of the Japanese version uploaded on February 12, 2018.

 

A.Prologue

        1. This story is about an event there was in the past. There were study groups for each high-tech sector which Industry Promotion Division of Chiba Prefecture and Industrial Support Technology Institute of Chiba Prefecture promoted and proceeded. In one of these groups, I think that it was probably the internet study group, a young man had been made a presentation about Money. I thought its money to have possibilities to become the community money, that is, there is a community or other community, and among individuals making up these communities, individual people do and therefore the amount of various labor which belongs to individuals, (that is, the amount of reward that can earn by working), and, as a currency that can show the amount of value born by production, (that is, the amount of value of all things, cars, personal computers, tableware, accessories, machines, robots, trains, planes, ships, rockets, space crafts, etc.), its money will be able to replace conventional money, I thought so. There is a memory that I sent its impressions to its man. And, it would be seemed that this man who was still young in those days had been developed the ‘Bit coin’.

 

        1. Next, recently, there was a news that an exchange named “Coin check” which exchanges virtual currency was hacked, and virtual currency “NEM” equivalent to 58 billion yen was stolen. And the responsible persons of this exchange say they are saying that they will refund to people who bought “NEM”. However, the refund rate is said to be 48 billion yen which is lowered by the theft. (The payment request from customers on February 9 is about 30 billion yen.) This is a strange story. The difference of “investment amount” – “refund amount” is remaining at the hand of the people of “Coin check”. How much money the investors exchanged for “NEM”? The responsible officials of the “Coin check” will indicate their intention to refund the money which exchanged at its time and they will have to make that effort.

 

B. The main subject

        1. I will write two episodes as a prologue and think about ‘Bit coin’ a little. Currently, the community of ’Bit coin’ is made up of participants who exchanged currencies such as yen and dollar to the ’Bit coin’ on the Internet. Among those participants, there would be many people that say, ‘I bought ‘Bit coins’ for speculation purposes, therefore I do not intend to participate in the community.’ However, it is a community including those people.

 

        1. Next, does a ‘Bit coin’ secure its value by what? Virtual currency, including ‘Bit coin’, outsiders like me cannot know its actual situation; who is issuing them in the system, who and how is collecting ‘Bit coin’ for exchange, and whether anyone can run an Exchange, and whether the issuing office also can use as an Exchange. But, what I can understand a little by reading it is that all transactions of ‘Bit coins’ on the network have the same content the record of “ledgers” written in the same way on a computer of a plurality of volunteer companies, therefore by all the plural “ledgers” having the same contents they prove its all transactions. ’Bit coin’ insists on the correctness of its own “ledgers” with the existence of this network, that is, a system (block chain) that can track all transactions without a defect. And this is a guess, but among the plurality of individual computers, it seems that ‘number of bits’ of the first computer which established the “ledger” calculation at first required are given as ‘Bit coins’ to this computer. This is calling ‘mining’. By the way, it seems that electricity used for transactions of ’Bit coins’ are 48 tera・wh / year (equivalent to the power consumption of 4.4 million homes in the US) (February 9, New York, Reuters). Here, even though the correctness of the “ledgers” is told, no value is given yet.

 

        1. The people who give value to ‘Bit coin’ are people (including corporations) who participate in this network by exchanging cash and ‘Bit coins’. However, unfortunately, ‘Bit coin’ is currently considered to be object of speculation and does not yet acquire the status of money. Besides, it is virtual money on the network. It may be that it ends like the tulip speculation of the Netherlands. What we should do?

 

        1. I am a one person who is thinking that money in the world is not enough. If I say so, you may laugh by saying that money circulating in the world is overflowing like a flood. However, it is a story in the developed countries and major countries, it is actually not enough in the poor developing country. At first, I thought next, if a country of the backward region such as Africa, Latin America, Asia and the Middle East will issue a real currency like a yen or dollar which have a unit name of ‘bit’, it is good. However, a country that is a military and dictator nation like North Korea is never an object. Though, there were some Web articles saying that North Korea is also involved on ’mining’. However, anyways, at area excluding such military and dictatorship nations, we will finance the money which collected by speculative elements of ‘bit coin’ to countries that aim for the development as a democratic liberal state, and when people of their countries use its money for developing their countries and enriching themselves, there will be no speculative elements of ‘bit coins’, the elements of public investment will be stronger, and an institution to supervise this will also be needed. In this way, if we prepare second stage of ‘bit coin’ and go into it, it will be good, I thought so.

 

C. The worries of society to virtual currency

        1. Now, the remarks of economists and monetary policymakers to the virtual currency are increasing. China already banned trading. German and French Finance Ministers and the Central Bank Governor expressed at the next G20 that they should discuss the policy of the virtual currency and the financial impact (Berlin, 9 February, Reuters).

 

        1. Certainly, looking at the transaction price (Exchanges: ’Bit fryer’) of ‘Bit coins’ carried on NHK’s NEWS WEB (February 11, 2018), the price of about 100,000 yen / 1 ‘Bit coins’ at the beginning of last year (2017) exceeds 2 million yen in December and it became about 1.25 million yen in January, and so on, price is becoming erratic fluctuations. On the site called CryptoCompare, the price of today (Japan time · February 12 · 16:10) is 926846, 06 yen.

 

        1. In the case of stocks, the economic activities of the company assure its value. In the case of virtual currency, there is nothing. Even in the case of Japan only, the fact we can guess from the theft of ‘NEM’ which corresponds 58 billion yen is the fact that the Shops and Exchanges of the virtual currency across Japan will be pooling a huge amount of money.

 

D. One trial thinking

I will talk about ‘Bit coin’ here.

        1. The current virtual currency ’bit coin’ is exchanged by exclusively target of speculation, and its price is decided by trading of people seeking speculative opportunities, but its value is not being guaranteed by actual economic activity.

 

        1. Even the virtual currency should contribute to the development of the real economy. I think that this contribution should be newly‐developing regions of the world. However, the military nations and dictatorship nations must be excluded. ‘Bit coin’ is a community currency, but it should not be a currency that circulates in only one region in one country. This is because it causes economic confusion and disturbance. Therefore, I think, in the newly‐developing regions of the world, we should contribute to the countries that aim to develop as a democratic nation and a liberal state nation. In this time, in these countries, it cannot be said that the existence of countries that are willing to issue currencies in unit of ‘Bit’, as I wrote above, is none at all. However, here, avoiding involvement in the state, establishing the Association (provisional name) of the ‘Bit coin’ network, and next, through the activities of this Association, investing in the countries with the will that I wrote above, the participants to the ‘Bit coin’ network would realize to contribute to the rich society of that country and the development of people.

 

        1. As a result, ‘Bit coin’ become to have worth having the connections with the real economy through the activities of the Association which is the activity organization of the ‘Bit coin’ network community and funding provided by the Association.

 

        1. Also, people who have connections with ‘Bit coin’ on the network must make efforts to realize this vision and contribute to the development of the country that realizes the vision.

 

Please note

The view which is writing here is the personal opinion of this blog author.