Bitcoin for your thoughts? How about a Rembrandt?

Bitcoin turns into art as Sweden rejects creative currency

Bearish Poll

Almost half of international investors are bearish on Bitcoin, with 47% of respondents in a Bloomberg Global Poll published today saying they would sell Bitcoin. Some 11% of respondents would buy the virtual currency while another 7% said they would hold it, with the rest of respondents saying they didn’t have an opinion.

Entrepreneurs are looking at using Bitcoin payment technology to undercut the billions in fees reaped by companies such as Visa Inc. and JPMorgan Chase & Co. from the use of credit and debit cards.

The price of Bitcoins soared in November, topping $1,000 for the first time, as speculators anticipated broader use of digital money. The price dropped to $805.1 today on Bitstamp, one of the more active online exchanges where Bitcoins are traded for dollars and other currencies. One Bitcoin cost about $15 a year ago.

Bitcoin, which first appeared the same year Lehman Brothers Holdings Inc. collapsed, was created by a programmer, or a group of programmers, going under the name of Satoshi Nakamoto.

Demanding Answers

There are 21 million possible Bitcoins that can be mined by a peer-to-peer network harnessing computers to complete complicated mathematical calculations. About 12.2 million units are currently in circulation, according to Bitcoincharts.com.

Swedish tax authorities are also looking into how to treat Bitcoin miners -- programmers who unlock new Bitcoins by using ever-faster computers to solve complex mathematical problems. Wallin said the question is whether they should be taxed as businesses, a classification that would allow them to deduct some equipment from taxes.

The challenge remains tracking a new market whose size and scope can be hard to gauge, even for regulators.

“I don’t think there are that many,” Wallin said. “But they have been calling us for answers.”

www.bloomberg.com

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