From time-to-time an innovation will come along that will disrupt a whole industry. For example, making sails was a significant industry at one point but Robert Fulton put a steam engine on a ship and disrupted the industry. Henry Ford disrupted the horse and buggy industries when he motorized the buggy. In our time we have seen the floppy disc industry disrupted by the little 3.5" discs and they in turn have been disrupted by thumb drives. And look at what digital cameras did to Eastman Kodak!!

Consider for a moment, what is money?

It is merely a system for transferring something of value from one party to another. We have already seen somewhat of an innovation disruption occur there with the introduction of credit cards and Pay Pal. Computers and on-line shopping are now disrupting shopping malls.

So here is the question: Is bitcoin an innovation in the money world that will exert a disruptive force?

And if so, who will be disrupted?

Will it be credit cards and credit card companies or will it be banks?

What impact might this have on the currencies of the various countries of the world?

Many years ago I heard the story of an old king who was walking through the countryside with some of his people. He met an old friend and stopped to visit with him for a while but his people kept walking. Shortly he closed his conversation with his friend by saying, "There go my people and I must follow them for I am their leader."

And so it is with bitcoins. If the masses embrace bitcoins, it will be an innovative disruption the likes of which you and I have not seen in our life times. If the masses lose interest in bitcoins the way that people lost interest in tulips in 1637, it will be a scam of epic proportions.

I obviously have no idea which way it will go but I want to be an active participant in the process rather than one standing afar wondering what is going on.

As I write this, the two pizzas Papa Johns sold for 10,000 bitcoins on 5/23/2010 are now worth $99,550,100.00.

Best wishes,

dhm