The Rise and Rise of Bitcoin Page #5

nice to meet you.

- Hi, I'm Mitch waldman. How are you?

- A pleasure.

- Got a minute?

- I have 10 minutes for you.

We're... we're a company

with no boss, essentially.

Everyone has

their responsibilities.

It's just

one big executive board.

- It's just one big executive board.

- Okay.

If I don't do my job,

these guys are all gonna yell at me.

So that's how we do it, but we get

things done. - WALDMAN: All right.

We're outgrowing this space,

as you can see here.

- That's a good problem to have.

- SHREM:
Yes. ( SIGHS )

Now Rachel said

there was a great concern

- about security in this space.

- SHREM:
Yeah.

We're regulated,

so we can't share an office

- with another company if they have

access to us. - I get that.

Our asset is our software.

Our software is processing hundreds

of thousands of dollars a day

instantly.

Really quickly.

And that's on-site here?

Or is it in the cloud?

No, this is in the cloud.

It's all in the cloud, but we monitor...

we have to monitor

everything from here...

- Right. - ...And debug, fix,

take down, upload more...

- put up more workers. - We deal with

high-volume data-oriented stuff every day.

Very very sensitive

customer data.

WALDMAN:

If there were not a doorman,

at the very least the space would

be designed in such a manner

that there'd be

a locked reception area.

If we want to pursue

a guard at some point,

we could have them

in that area.

- ( WALDMAN SPEAKS )

- I absolutely think

- it will be at some point. It's just

a matter of time. - Really?

The potential

for theft is huge.

It's like operating

a bank, essentially.

SHREM:

That's pretty much it.

- Gotcha.

- It's basic stuff.

Yup yup. All right.

Any other words for me?

- Okay.

- Are you willing to handle the task?

- Sign me up, captain.

- ( LAUGHS )

DANIEL:
That night,

the price got as high as $266.

Every major news outlet

had taken notice.

Bitcoin fever was

at an all-time high.

It is getting

a lot of attention.

People are fascinated by

anything that makes new highs

every day for weeks on end,

which bitcoin has done.

In terms of the total number

of the people

using the currency,

I'm not sure,

but you can say

that there's a huge amount

of fluctuation

in the volume of trading.

DANIEL:

And then the price crashed.

Bitcoin lost more

than half of its value

in six hours.

From craze to crash.

It's the talk of many people

in the blogosphere,

and it's certainly suffering

some growing pains.

The value of the virtual

currency bitcoin has plunged.

It's been

a crazy day today.

I haven't slept

in like 40 hours.

Your order processed.

I don't understand

why we're still having

this conversation.

We refunded your order.

We sent you extra bitcoins.

MAN ON PHONE:

I don't care, man.

When it comes to my money,

I don't f*** around.

SHREM:
I know, man.

You need your stuff.

I hear ya, I hear ya.

It processed.

Your bitcoins

are there, man.

NICK:
So, Charlie,

what's been going on today?

- Crazy day, huh?

- Yeah, mt. Gox...

their whole system

pretty much failed

and their whole

trading engine is broken.

Pretty much caused... almost...

us to shut down for the day.

Further, the bitcoin price

has just been

wildly swinging up and down

it was down $100 today.

It's gaining back up, but mostly

because people can't buy and sell

and they can't withdraw

and they can't deposit.

'Cause the whole thing

is just... it's just a Fritz.

So what we're trying

to do is figure out a way

to mitigate orders

somewhere else for now.

DANIEL:
With mt.

Gox stuck in a nosedive,

the ripple effect is creating

chaos in the bitcoin markets.

( MAN MUTTERS )

SHREM:

I'm trying to figure out

why our orders

aren't going through.

Rachel, am I allowed

to take another advil

if I took one

an hour ago?

They've been having problems

ordering anything off of gox.

Yeah, I'm getting a lot

of customers emailing,

saying "it says 'executed, '

but it's not showing in the blockchain."

SHREM:

Dude, gox suspended trading.

- Really?

- Yeah.

"Orders placed

suspended until 2100."

What time...

what's 2100?

What? That's 9:
00 P.M.

oh my God.

( SIGHS )

( PEOPLE CHATTERING )

If you bought at 150...

And then you're at 260,

and then you watch it

dip down back to 150,

do you panic some?

Yeah, absolutely.

I don't know what a bitcoin is.

I just bought it.

( EXASPERATED SIGH )

F***.

You see buy orders,

people buying

and selling

at such a wide range.

It doesn't make

any sense.

SHREM:

The a.P.I. Is just constantly failing?

Is that what's going on?

Or are we're not getting any orders.

( BIRD CHIRPING )

DANIEL:

Don't care about the price.

Speculators can play

musical chairs

all day long

for all I care.

I'm-I'm... I'm long.

I was focused on expanding

my mining operation.

The only people that

are gonna be shaken out

by this drop

are people that

are new to bitcoin.

Here's the avalons,

spinning away,

mining away.

And if everything

goes as planned,

we'll have 18 more

of these guys

in a couple of weeks.

Bitcoin is

a complicated thing.

You have to spend

some time looking into it

and understanding it

before you really care.

Now there's droves

of people that...

you know, are giving it more

than just that glance,

because the price

has gone so high.

And they have dollar signs in

their eyes like Uncle scrooge.

It's so much more than that,

and I think that's why

the people who are mining

and the people

who believe in it

are just

kind of holding strong.

When trading resumed

at mt. Gox,

the price fell

even further, to around $70.

71 on b.T.C.- E.

Yeah, bitcoin...

it's volatile.

It's gonna be a long time

until we have stability.

That's the nature

of the beast.

Price discovery can be

violent and volatile.

There's gonna be a lot

of people that come and go,

and people

that scream wolf.

But at the end of the day,

the only thing that really

kind of stinks right now

is that everybody is

trading on one platform

that isn't doing

the greatest job, so...

Over time, hopefully we'll see

some more exchanges pop up

and get

some more options in.

People wanna keep

using bitcoin,

I'm sure the infrastructure

will come.

( BIRD CHIRPING )

It's just gotten

ridiculously busy.

I get an email

every two seconds now

- and pretty much more email than I...

- ( LOCK BUZZES )

Than I can keep up with.

DANIEL:

Jered kenna is the c.E.O. Of tradehill.

The first U.S.- based

bitcoin exchange

to compete with mt. Gox.

He's also on the list

of bitcoin millionaires.

- ( BARKS )

- This is finnegan right here.

Guard dog.

Hey, finnegan.

( MIMICS GROWL )

DANIEL:

Jered runs tradehill

out of a 41-bedroom

residential hotel

called 20 mission

that he also owns.

( WHIRRING )

We mostly rent out rooms to tech people,

startup people.

There's a lot

of bitcoiners.

I actually accept rent

in bitcoin,

which is great, because we have

a lot of international people.

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