NEW YORK (2/19/14)--2013 was a big year for digital currency Bitcoin in terms of building visibility. One of the currency's longtime developers, Jeff Garzik, says 2014 will be a big year in terms of "action."
An article in The New York Times' Deal Book, a financial news service reporting on mergers, acquisitions, venture capital and hedge funds, warned, however, that if Bitcoin is to succeed it will have to prove to be built sturdy enough to withstand "increasingly difficult conditions."
Along with an looming spectre of regulation on its horizon, Bitcoin also must address: a software glitch that that forced some big Bitcoin exchanges to shut down for days because of problems with moving Bitcoins between digital accounts, and; an apparent system vulnerability to hacking attacks that call its security network into question.
Bitcoin's Garzik was quoted as saying that the problems exposed recently should not be a long-term issue for the network. But he did also acknowledge that Bitcoin faces significant tests into the future. Garzik now works for the Bitcoin company Bitpay.
Calling the virtual currency operation he helped found a very young ecosystem, Garzik said it is the nature of the nascent field that more attacks will be comng down the virtual pike--likely bigger and more disruptive than what has been seen.
Deal Book also looked at the burgeoning regulatory discussions that are entering the burgeoning digital currency arena. It identified Benjamin Lawsky, New York's financial services superintendent, as the leading figure in this country's attempts to establish regulations for virtual currencies. In fact, the article noted that that Lawsky said recently that he hopes to propose an operating framework later this year.
That happened on the same day that Canada's finance minister, Jim Flaherty, announced his plan for national rules. On the other hand, Russia recently decided just to decalre virtual currencies illegal.