“If there was a single confirmation, I would feel very, very safe,” he says, “If I was selling the house, I would want about four confirmations. But that’s my paranoia,” he adds.
“In my previous job, I used to rely on international wire transfers and I had to pay $40 every time I wanted to expand the fruits of my labour,” he says.
“That is 1% of my income, for what? For paying to try to stop criminal activity like money laundering. The banking system is doing an absolutely terrible job,” he says.
He agrees bitcoin attracts a lot of unsavoury people.
“People will be duped, but that happens in every currency,” he says.
Regulation required
The reason digital currencies are so cheap to use is partly because they are unregulated, which can create a haven for swindlers and money-launderers.
Greek economist Yanis Varoufakis says in the US even pizza parlours and High Street shops accept bitcoins.
“In other circumstances, for instance in video games like Eve Online, the company that puts together this game is the one that issues the currency and it effectively becomes a private central bank,” he says.
He points out that when a private corporation is in control of a currency, there has to be trust in its ability to look after its customers’ credit.
“When you are creating a currency whose purpose is to be unregulated and then that currency gains value and its exchange rate with the dollar or the pound sterling increases, then clearly this is going attract all sorts of people who want to launder their illicitly earned money,” he says.
However, there are people who like the idea of a currency which bypasses the men in grey suits who have controlled everything until now.
Mr Varoufakis cites the eurozone crisis as being an example of when a digital currency might be preferable to more established options.
“If Greece were to reconstitute its own currency, it would take at least eight months to do that,” he says.
“With digital currencies, you can create them at a touch of a button. What it does not offer is the opportunity of escaping the need for regulation,” he adds.
Furthermore, digital currencies are global currencies, which raises many issues concerning taxation – in which country are you taxed?
“If you are a libertarian and you think that taxation equals theft, then you don’t care much about this question because the answer you will get is, ‘Well let’s not get taxed and let’s allow the various states to wither,'” he says.
“But if on the other hand you believe that states are essential for maintaining civilised behaviour and for having regulation, then it is a problem,” he says.
He would not advocate Greek citizens converting their euros into digital currencies.
“I would advise them to put them in a German bank,” he says.
