The city I live in thinks its OK to give away taxpayer dollars for a bitcoin miner operation.
Well... I'm personally not too negative about that. Sort off...
See: when talking about bitcoins most people obviously think about money. But I don't mean "money" as in "crypto currency" but: "How much money can
I make from that?". A logical reaction but one which also totally overlooks the grand scheme of the bitcoin: an independent currency which will only be worth as much as "
We, the People" put into it. Within that reasoning you can say that bitcoin is probably one of the most honest forms of currency out there (just like any other crypto currency).
But in order to work the network needs nodes. And nodes, by definition, don't have to be reliable. I mean, how many nodes will have stopped their activities now that the bitcoin has taken a few bumps?
That's also something many overlook: keeping the network alive. It's not just about mining, but also about transaction processing.
Personally I think the bitcoin is a very interesting development and from a technological standpoint pretty impressive too.
Of course from a financial perspective it's a soap bubble. However I don't consider that to be a bad thing, because if you understand what a bitcoin actually is then you'll realize that it's actually build upon this "bubble design" principle. Instead of gold, or a government, it relies on trust which people put into it. Well, I'm sure that anyone who has briefly followed the stock market will realize that people's trust can change on a whim, especially where money is involved.
And that brings us to the problem here. My answer is two-folded.
Because of that bubble construction it also means that endeavors such as the one described in the OP will somewhat help strengthen the whole bitcoin. Which I consider to be a positive thing because I think the bitcoin by itself is a very interesting development and I actually hope it'll manage to stabilize itself. From a technological perspective I really support this news because I think bitcoin still has a future. Of course, 500k is a bit overdoing it, especially considering it's taxpayers money.
And that brings me to the other side of my opinion, that from a business / financial perspective. Because I think you'd have to be crazy to invest millions into bitcoin especially
if you expect to earn those back.
As you can read above I'm pretty positive about the bitcoin and the involved technology. But would I actually invest money into it? Hell no. I also have a few nodes running because I like what bitcoin stands for and because it doesn't heavily tax my network (I know: "
then you're also not going to make any money and you're a fool for even trying", watch me no care!). But there's
no way I'd actually invest hard dollars / euro's into this because that's definitely a lost cause I think.
SO yeah, I think it's a positive attitude for a government to somewhat support this, though I also think that 500k is overdoing it. Another problem I have with this is that the article doesn't answer the question if the government expects to get this money back. Because if so: good luck to them!