The book that made me (almost) believe in bitcoin

Bitcoins are digital money ‘mined’ from satanically difficult mathematical problems. Madness, obviously. But five years ago, while the rest of us were saying ‘Huh. Geeks. Money in cyberspace’, or ‘Y’what?’ a young doctor I know bought a few quids’ worth for fun. Sold it later for £800. Now she’s out on a hillside in the driving rain with her hawk. Bitcoin paid for the hawk. As for cyberspace, that’s where all money is anyway. Bitcoins simply take it a step further. It might be the first step on one of the most important journeys in economic history.

It’s a strange, compelling tale, and three things lie at its heart. First, the belief that there is something fundamentally wrong with our money as we currently know it; that it’s the money itself that enriches the rich and impoverishes the already-poor.Second, the proposition that a transparent digital currency is a better system because it exists independently of banks, governments and middlemen scratching for their cut.

And the third strand is Dominic Frisby’s hunt for the identity of the cryptographer who calls himself ‘Satoshi Nakamoto’: the man who thought up Bitcoin.

Frisby is a columnist for MoneyWeek, but, more importantly, he is a stand-up comedian, which demands high intelligence, close observation, asking the un-obvious and finding memorable answers.

He does a magnificent job. Even the word ‘finance’ makes me feel queasy, but since reading Bitcoin I have been thinking about money — what it is, where it comes from, how it stores its value, where that value comes from, how it is exchanged — with the same sort of intensity that atheists reserve for their relationship with God.

As the stock markets were crashing in flames in November 2008, Satoshi Nakamoto posted on a cryptography mailing list that he’d devised a ‘new electronic cash system that’s fully peer-to-peer, with no trusted third party’.