Vol. 1 / No. 2.2 — Befuddled About Bitcoins? These Two Are Here to Help

Chris Wilmer and Conrad Barski are different kinds of doctors: Chris holds a PhD in Chemical & Biological Engineering from Northwestern University and is currently doing a postdoc at Harvard before starting in his new lab at the University of Pittsburgh in the fall of 2014. Conrad holds an MD from the University of Miami and has spent over two decades in the medical programming community. He has already written one book on the programming language LISP. What the two share in common is an avid interest in the phenomenon known as Bitcoins, and recently I got the chance to ask them a few questions about their latest project: “Bitcoin for the Befuddled” — a book on bitcoins that will tell you everything you need to know (and more) before getting involved yourself.



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To get us started, for readers who aren’t terribly familiar with the topic, can you describe what bitcoins are in 300 words or less?

Bitcoins are a new currency, just like dollars, euros, or yen. You can save them, spend them, and exchange them for other currencies. The difference, however, between traditional currencies and bitcoins is that they are both digital AND decentralized. This is without precedent. Whereas our dollars are already digital (and so we can easily send them to friends across the world via Paypal or similar services), their supply is controlled by a central bank. Gold coins, on the other hand, are decentralized in the sense that nobody controls the supply of gold in the world and anyone can make and distribute them. It’s hard to use gold coins to pay for groceries (and give exact change!) and it’s impossible to e-mail gold coins to your friend in another country. Bitcoins combine these two properties, digital and decentralized, and so are kind of like “digital gold.”

So “decentralized” means that nobody controls them? There’s no central bank of bitcoins?

Right. One of the important (but confusing!) aspects of Bitcoin is that it is a technology that nobody owns. There is no Bitcoin Company and there are no central Bitcoin computer servers. Like the Internet, or electricity, or fire, no one individual dictates how and whether to use Bitcoin. As a society, however, we can create some ground rules about how we will use this technology. There isn’t a Fire Company that we can politely ask to stop forest fires, but we can all agree to keep our camp fires surrounded by a healthy pile of rocks.

What are bitcoins to the two of you? Why did you decide to write a book about them?

We are both programmers in our day jobs and were fascinated by the sheer brilliance of Bitcoin’s design. Like many Bitcoin enthusiasts we wanted to tell our friends but found that it takes some work (and a bit of humor) to explain the details in a user-friendly way. Conrad started making a comic about a bunch of cryptographers stranded on disparate islands to explain how Bitcoin works, but there is so much to say on the subject that we ended up writing a book too (the comic is in the book though).

Why should anyone care about bitcoins?

Like the Internet, or electricity, or fire, the usefulness of new technologies is often unclear in the early stages (but painfully obvious in hindsight). Did every business in North America need a website in the early 1990’s? No. Today however, a website is as important as a phone number or a street address. Bitcoin has the same potential. You don’t need to know how to use bitcoins as payment today, but you should care, because in a decade it might be impossible to live without them.

Sometimes new technologies vanish without having any impact on society, either because they were flawed in some way or were ahead of their time. What will Bitcoin’s future be? Nobody knows, but the first five years have shown exponential growth in user adoption — much faster than anyone expected.

Recent stories like this one like to focus on the instability or insecurity of bitcoins; why do you think people are so nervous about bitcoins, and why aren’t you?

There are two answers here. First is that there is a frequent confusion between Bitcoin the currency, and third party services that make use of bitcoins some way. The latter is full of disasters but the former has an almost flawless record of perfect security and reliability. A website being hacked with the result of users losing their bitcoins is terrible, but like a bank robbery, it doesn’t diminish the viability of the currency itself. That being said, the second answer is that Bitcoin is such a young, poorly understood technology that there are going to be a lot of bumps along the road. Because it is so small, any problems with the user experience do in fact threaten people’s confidence in Bitcoin’s value.
I am sure traditional banks have become much harder to rob over the last hundred years, and I am confident that Bitcoin banks will also develop better security practices over time.

If they’re just like regular currencies, then I assume you can spend them?

In 2011, there were only a few hundred merchants that accepted bitcoins, but today it is closer to a hundred thousand. Although not nearly as widely accepted as traditional currencies (yet!), you can buy pretty much everything from groceries and sushi to real estate and cars with bitcoins today. A couple in Utah managed to live for three months this year using only bitcoins. 

Lastly: should I buy some Bitcoins?

If only to learn about how they work, I think it’s worthwhile for anyone to buy 50 cents worth of bitcoins (or less). In the United States, services like Coinbase let you easily buy and sell bitcoins, so you can get a few dollars worth of bitcoins and then exchange them back into dollars again. Although bitcoins have been increasing in value very quickly, they are still an experimental currency and so you shouldn’t buy more than you are willing to lose. That being said, as time passes, it is becoming increasingly likely that bitcoins are here to stay.

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Bitcoin for the Befuddled is being published by No Starch Press in early 2014, and you can view their comic and promotional website here. Conrad Barski can be found on Twitter at @lisperati, and don’t forget to follow me, too, at @TWITomorrow for more news and updates.