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Marc Andreessen predicts “Libertarians will turn on Bitcoin”

Wed, 03/26/2014 - 2:14am
MIT Technology Review

Bitcoin got where it is today in no small part thanks to early adopters of a libertarian bent, who prized the idea of replacing conventional currencies with something that could operate without regulators or central banks. But venture capitalist and vocal Bitcoin bull Marc Andreessen said today that the “fringe politics” would soon be left behind.

“My prediction is that libertarians are going to turn on Bitcoin. That’ll be in about two years, when it’ll be mainstream,” he said at a San Francisco Bitcoin conference.

Andreessen, who developed the first Web browser, compared the prevailing politics of Bitcoin’s earliest community with the beginnings of the Web. It, too, was first embraced by people with political views outside the mainstream, he said, something he sees as a hallmark of disruptive new ideas: “I don’t know how you get fringe technology without fringe people and politics … You just need to go through a maturation process where the technology emerges as mainstream at the other end. Along the way the fringe politics will move on.”

Last year, before regulators had warmed to Bitcoin, I reported how the influx of investors and efforts by larger Bitcoin companies to work with regulators was disappointing some fans of Bitcoin (see “Bitcoin Hits the Big Time, to the Regret of Some Early Boosters”). Since then, regulators in the U.S. and elsewhere have talked positively of the currency (see “Regulators See Value in Bitcoin”). Andreessen said today that his contact with unspecified U.S. agencies suggested that they now see advantages to Bitcoin over the dollar, for example, in the way all Bitcoin transactions are publicly recorded in a digital ledger known as the blockchain.

“The smart people in the government have figured out this could be an immense tool for them,” Andreessen said. “In contrast to people using paper currency, it’s actually a fairly attractive thing to be able to mine the blockchain.”

There has been speculation that the FBI analyzed the blockchain as part of its investigation of the Silk Road marketplace where drugs and other illicit drugs were traded using Bitcoin. But no law enforcement or government agency has yet indicated it is using that tactic. Research by academics suggests that combining analysis of the blockchain with other data could make it possible to trace and identify the flow of bitcoins in some detail (see “Mapping the Bitcoin Economy Could Reveal User Identities”).

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