blog If you needed any further indication that we now live in the science fiction future long ago mapped out for us by visionary authors, then look no further. News arrived this week that an Australian digital currency company and Bitcoin mining concern, digitalBTC, has listed on the Australian Stock Exchange through a backdoor listing. You can find the full media release available online in PDF format, and here’s what the company’s chairman, serial entrepreneur Zhenya Tsvetnenko, had to say about the move:
“Bitcoin is a highly exciting and fast emerging currency system which I believe will dramatically change the way in which many users approach making payments or financial transfers in our new hyper-connected, globalised world where the old boundaries and intermediaries between citizens and firms in different locations become less relevant.”
As the Bitcoin system matures beyond its initial niche and begins to realise its true disruptive potential, sophisticated service firms will be increasingly required to facilitate the system. We believe that sophisticated intermediaries such as digitalBTC can derive significant profit in supporting this emerging growth phase of Bitcoin, as it takes its place as a true worldwide currency.”
According to its media release, digitalBTC has established Bitcoin mining revenues, including “strategic agreements with key Bitcoin mining partners”, an established trading desk and market bringing in revenues, is currently developing retail consumer products around Bitcoin, including digital currency mobile applications, a well-credentialed management team, and long-term growth potential. The company has raised some $9.1 million as part of its listing.
To be honest, I’m not sure what to make of this. BitCoin is only five years old, its origin is murky and there have been several very high-profile problems with major companies trading the currency, including the theft of Bitcoins worth more than US$450 million from Tokyo-based Bitcoin exchange Mt. Gox. Traditional investors are certainly leery. Warren Buffet’s thoughts on Bitcoin, as quoted by investor publication The Motley Fool this week about digitalBTC’s listing, are as follows: “It’s not a currency. I wouldn’t be surprised if it wasn’t around in the next 10-20 years. It’s being priced off the [US] dollar,” Buffett added. “It is not a durable means of exchange.”
Is this crypto-currency really stable enough to form a platform for an ASX-listed company, with all the regulatory controls that come with that? I guess we’ll find out. Either way, I think we can establish one thing through this exercise: Australian investors love the technology sector. If they’ll pump $9.1 million into a venture in a sector this unstable and risky, they’ll probably invest in anything.