BitCoin hits CHF 100 mark

Yesterday one BitCoin was, for the first time, worth more than CHF 100!

When I first learned about BitCoin in early 2011, CPU mining was still enabled in the default client. I mined for a few days, but it was probably already too late for the CPU. GPU’s took over before that. Last year, you needed FPGA’s to profitably mine, and now it’s shifting over to fully custom ASIC’s. I still sometimes mine with the GPU in the background while the Computer is running anyway, and I don’t use the GPU for anything else. It didn’t find a block so far. But for me that’s kind of like playing the lottery. The chances are slim, but if my computer could find the proper hash, that would cash in 25 BTC at the moment which would equate to CHF 2’500. And that slim chance starts over roughly every ten minutes.

There is a site somewhere on the net (I forgot the location) where you get free BTC. Back in those days, you got 0.05 BTC. That’s how I started off. This would now equate to CHF 5, but these days you get much less.

Since July 2011, I accept BitCoins as payment for the paraeasy.ch paragliding tandem flights. In fact only one guy payed that way so far. In October 2011 the flight cost 75 BTC at a rate of less than CHF 3 per BTC. If I still had those 75 BTC, they would be worth a whopping CHF 7’500 today.

I was thrilled last August, when it had an 80% increase within two weeks. But what happened this year was just insane. The price went from CHF 11 to CHF 110 in just three months. There were weeks with 10 to 15% increase every day.

The other day I walked past a local bank, and saw an advertisement for a defensive savings plan with an 8 year obligation where you get 1% profit. Of course it’s an unfair comparison. Noone knows what will happen next to the BTC value. It could drop any day for any number of reasons, or it could keep rising. I wouldn’t invest my savings so far.

There is a lot of speculation going on about the future value of BTC, and how certain events could influence that. Last week I read an interesting article about that. But there is also a lot of speculation about a bubble about to burst. Indeed the recent rise in value was so unnaturally fast, that it looks like a bubble. But such a bubble already bursted in 2011, and BTC recovered remarkably well.

Let’s not concentrate on the value itself. I think for BTC it would actually be better if the value was a bit more stable. The system was designed as a means to transfer money quick and easy. The main motivator was being able to transfer funds around the globe without waiting for a couple of days to arrive, and paying ridiculous transfer fees, as with current bank wire transfers, credit cards or paypal. That’s where BTC really shines. Of course it’s nice to see the value of your Coins rise, but I hope a possible bubble will not harm the system too much, and I strongly hope if that bubble should really burst, BTC will recover even stronger.

Update : additional links to good articles:

The bitcoin bubble and the future of currency

Are BitCoins the future?

The target value of BitCoin

BitCoin in the 3rd world

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