Bitcoin enthusiasts, investors and entrepreneurs staged a spirited defence of the cryptocurrency at the Inside Bitcoins conference in Berlin this week.
This is the “glitch that will help end bitcoin” declared Bloomberg's Leonid Bershidsk. He went on to argue that bitcoin is now only propped up by a small number of individuals with too much capital invested to allow the currency to fail completely.
“Not a chance” came the response from bitcoiners at the conference in the German capital.
Oliver Flaskämper, CEO of Bitcoin Germany, kicked off the event by saying that only two things could pose a permanent threat to bitcoin: a major technical issue or global ban – neither of which have happened yet.
The current transaction malleability issue will soon be resolved and bitcoin will come back stronger, he said. And as far as a global ban goes, it would be almost impossible: “Anyone who wants to ban bitcoin will have to ban the Internet,” he said, to applause from the audience.
Bitcoin evangelist and worldwide bitcoin traveller Nicholas Cary, also known as the CEO of Blockchain.info, said he is paying close attention to the ongoing glitches, but remains confident they will be resolved soon. He said:
“Individual service providers are going to have to issue patches and longer term some thinking may evolve of how to best approach this. We will rely on the core development team to give us guidance.”
The conference drew over 300 people from 14 countries for two days of discussions focusing on the future of bitcoin.
A new umbrella organisation was also launched, the Global Bitcoin Alliance – a “bottom-up network of non-for-profit organisations that promote and protect Bitcoin.”
Aaron Koenig of Bitcoin Exchange Berlin is one of the founders of the Alliance. He claims this is the perfect time launch an organization that defends bitcoins against attacks. However, he sees the alliance as a support group rather than a leader in the fight.
“The real work will have to be done on a local level. But we will be there to help provide information and support,” he said.
The death of bitcoin?
So, what is the newly formed alliance's reaction to the rumours of bitcoin's demise?
“The death of bitcoin has been announced so many times, but bitcoin is very strong, a very resilient piece of technology that can not so easily be taken down. It will only make bitcoin stronger.”
He was calm about the current crisis, saying only that it will be "worked out soon". However, he was keen to set the record straight about bitcoin in China.
“Bitcoin in China is not over by any means,” he said. He went on to explain that the sanctions imposed were not as draconian as sometimes reported. What was more of a problem were the verbal warnings the regulators gave financial institutions.
In essence, it was a case of the regulators quietly asking the institutions to stay away from bitcoin rather then imposing laws.
The effect of this is that bitcoin trading is down 80 to 90% in China, and this will probably continue over the next six to 12 months. However, after this cooling off period, bitcoin will be back, Lee said.
“All the goodness of bitcoin has not changed. What have changed are the perceived regulations around bitcoin. It needs a few months to clear out and settle. After that, bitcoin will continue its meteoric rise”
Fighting talk from the bitcoin evangelists – only time will tell if they can prove the skeptics wrong.