Looks like Bitcoin is getting itself a little more news recently with the formation of the Bitcoin Foundation—a recently formed PR organization seeking to clean up the bad reputation that the cryptocurency has gained in the wake of numerous hacks of trading websites and it’s association with potential criminality. Also in the news is that Bitcoin exchange ICBIT has quietly added a futures market that involves bitcoins as its main currency including gold futures and crude oil.
The Bitcoin Foundation
The mission of the Bitcoin Foundation looks to provide three major things to the Bitcoin community: A standards body with open discussion about protocols and adoption; protection for Bitcoin itself by soliciting answers on improving the trading protocol and security; and promotion for the currency into the public sphere in order to foster adoption and interest.
“We approach that mission with Bitcoin’s technology and community as our focus,” writes the Bitcoin Foundation on their About Us page. “There is tremendous potential in Bitcoin—from the opportunities it creates for entrepreneurs to the purchasing power it provides for citizens of countries large and small. Our goal is to help Bitcoin deliver on that potential.”
The foundation argues that such an organization is needed for Bitcoin due to the current wake of volatility in the market and the constant surge of news related to fraud and hacks that hit bitcoin-related interests. In fact, here at SiliconANGLE we can attest that most Bitcoin news often means hacks leading to thousands of dollars worth of bitcoins being pilfered (such as Bitcoinica) or international watchdog groups and governments addressing concerns about the use of bitcoins in criminal activity such as money laundering.
However, mixed in there with any burgeoning technology—which include currencies—there’s talk about the development of devices to assist in the movement and presistance of bitcoins in everyday use such as the Bitcoin Card or how the international economics community is starting to take interest in how Bitcoin economies work.
The founders behind the Bitcoin Foundation see this as well:
“As the Bitcoin economy has evolved, we have all noticed barriers to its widespread adoption—botnets that attempt to undermine the network, hackers that threaten wallets, and an undeserved reputation stirred by ignorance and inaccurate reporting.
To us, it became clear that something had to be done. We see this foundation as critical for bringing legitimacy to the Bitcoin currency. Only then can we increase its adoption and positive impact on the world’s finance.”
Although it’s obvious that the Bitcoin Foundation has their work cut out for them, it’s also obvious that news exists and is being generated about the innovative uses of bitcoins every day. It should only take the dedicated work of networked organizations to amplify that and at the same time strengthen the underlying principles that make it function as a community.
Bitcoin Futures Market at ICBIT.se
The addition of a futures market to a Bitcoin exchange feels a lot like strange news, however, it does add to the overall presence of alternative uses of bitcoins than mining and pure internal speculative markets. Recently, it came to our attention (via Slashdot) that ICBIT had added a futures market.
“Futures contract is a standardized contract between two parties to exchange a specified asset of standardized quantity and quality for a price agreed today (the futures price or the strike price) with delivery occurring at a specified future date, the delivery date,” ICBIT explains on their website describing the introduction of this service. “All contracts are quoted in Bitcoins and some of the contracts are quoted in another currency (e.g. US Dollars in case of BTCUSD family of contracts). ICBIT provides a margin system with upper and lower limits within a trading session that are similar to any major futures exchange.”
Currently, the Bitcoin economy still suffers not just from a lack of widespread adoption; but from a lack of overall uses for bitcoins. Although it’s true that we’ve seen numerous exchanges appear (they just trade bitcoins for other currency) and an auction house taking advantage of the nature of bitcoins, there’s a lack of merchants and other uses currently even as the currency grows in popularity.
We can throw this one onto the ever growing mountain of Bitcoin products that are being developed and will have to visit it again in a year to see if the adoption of a futures market has given ICBIT an advantage over other Bitcoin exchanges.