Thomas Massie: Replace The Fed With 'Bitcoin'

Have you ever heard of Bitcoin?  During a recent panel discussion when asked about his desire to end the Federal Reserve (his license plate even says "NDFED") Massie was asked what would replace it and he blurted out "Bitcoin".  I won't try to describe what "Bitcoin" is, I'll leave the research on that up to you.

But up until very recently this Internet based method of exchange which in a sense it's own currency for goods and services is getting some rather mainstream attention.

At its most basic level a Bitcoin is a form of money that can be used to pay for products or services just like the dollar bills that sit in your wallet.

A Bitcoin lives as code inside a computer. It’s intangible, but it works in many ways like cold, hard cash.

To acquire a Bitcoin, you need to buy it with another currency or have someone send it to you in a transaction. To hold a Bitcoin, you need to keep it in a digital “wallet,” a piece of software, on your local computer or you can you can allow a company to hold your “wallet” on their servers.

Bitcoin payments are made by transferring the digital currency between two users’ “wallets.” The fees for these transfers are lower than for more traditional forms of payments, like using a credit card or a bank transfer, because they are not backed by the safeguards and intermediary services provided by companies like Visa or Bank of America.

Bitcoin is “decentralized” meaning that it’s created and maintained by a network, rather than controlled by an institution like the Federal Reserve. The monetary policy of Bitcoin has already been established in a sense, with a cap of 21 million Bitcoins being able to enter circulation to reduce the risk of inflation.

Right now the price of a Bitcoin is around $100.

Bitcoin and other virtual currencies are increasingly drawing the attention of federal and state officials, though many have yet to formally express their views.

The chief worries have been whether they can be used by criminals to launder money, sell drugs, fleece unsuspecting consumers or evade taxes. [POLITICO]

Bitcoin, at this time, appeals primarily to people who dislike government, want to avoid taxes, and have a bit of a radical libertarian/anarchist type philosophy.  It's geeky, operates in its own subculture and requires a more sophisticated level of computer knowledge than your typical grandma who sometimes checks out Facebook.

For these reasons it should come as no surprise that Ron Paul acolyte Thomas Massie may very well be the first U.S. Congressman to endorse using Bitcoin instead of US currency.  How this squares with the people in Bromley, Sligo, Corinth, Perry Park, Covington and Alexandria is yet to be seen. But for a Congressman whose focus until recently has been upon playing "junkyard wars" and building robots the appeal of his latest radical idea is anybody's guess.