Bitcoin: The realities of virtual currency

Published: Tuesday, April 8 2014 12:00 a.m. MDT

During an interview with CNBC, Berkshire Hathaway CEO Warren Buffet denounced bitcoin as “not currency” at all and expressed concerns about its long-term viability, telling the financial news network that he would be surprised if the digital currency was still around in the “next 10-20 years.”

Lately, the cryptocurrency world has been rocked by a number of troubling events. In February, Autumn Radtke, 28, CEO of bitcoin exchange firm First Meta, was found dead in her Singapore apartment. And in one of the biggest collapses on record, Mt. Gox, the world’s largest bitcoin exchange, recently folded after hackers made off with almost $500 million in bitcoin.

Utah County computer and software entrepreneur John Pestana said the Mt. Gox failure was an issue not with cryptocurrency but rather with the exceptionally lax security measures employed by the exchange.

“It would be like driving to New York City to the most dangerous neighborhood in town in your brand new Mercedes and leaving the keys in the car with the window down,” Pestana said.

He added that companies and individuals could easily protect themselves and their bitcoin by storing it in a secure exchange, a cloud-based “wallet” or an offline account.

Pestana described the increase in cryptocurrency usage as “revolutionary” and a movement he expects to grow in the coming years.

Walker concurred, saying there is always the possibility for human error in exchanges, like with Mt. Gox, but the actual cryptocurrency is not to blame.

"It's like someone losing a suitcase of money and blaming money for it," Walker said. "The idea of electronic money is absolutely here to stay."

Contributing: Ashley Kewish

Email: jlee@deseretnews.com

Twitter: JasenLee1

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