It’s Sunday, so my audience will be a bit limited. No point in pushing the boat out.
After the massive hacking event on Friday, one of the things that most offended some commentators was that payment for unlocking the encrypted files had to be made in Bitcoins*. Lots of harrumphing about ‘virtual currency’ being used to hold the world to ransom.
I’ve got some news for the stuffed shirts. Every currency in the world is virtual. Every single one. Sterling Euros, dollars, yen, Swiss francs, bahts, ringits, dirhams… They’re all imaginary. If you buy something on your credit card, a truck full of cash does not turn up at the supplier. It’s all imaginary. It’s a series of 0s and 1s.
If you took a British pound coin to a scrapyard, you sure as hell wouldn’t get to sell it for a pound, since the scrap value, the true value, is a few pence. The notional worth of the entire US is in excess of $270 trillion. There certainly aren’t that many dollar bills, which incidentally cost 5 cents to make. Just more 0s and 1s.
English notes are marked, ‘I promise to pay the bearer x pounds,’ which the Bank of England clearly has neither the intention nor resources to do. The worldwide foundation of trust is one of the reasons that things went to hell in a handbasket back in 2008.
*I did a bit of research here. You can buy Bitcoins. With other currencies. Doesn’t that miss the point a bit?
Otherwise you can mine them, getting your computer to do some tricky sums. Since there’s a limited supply of Bitcoins, a mere 21,000,000, you’ll need to get your skates on. Also, as the supply dries up, the calculations get more complex, and they’re now beyond the capacity of home computers, to the extent that the cost of power to run a server of sufficient capacity exceeds that of the value of the currency. Some cleverclogs suggested you locate your server in Iceland where geothermal lekkie is so cheap they almost give it away, but that may be beyond your modest resources.