The disenchantment of Bitcoin: unveiling the myth of a digital currency

Abstract

Bitcoin and its peculiar, decentralized transaction system, have already ignited interest by professional and retail traders in search for profits and by economists and legal experts, looking for possible regulation to contain illegal uses. We instead examine the unexpected and ongoing success of Bitcoin from a sociological perspective, first questioning its unusual legitimation system, backed by the so called ‘blockchain technology’, instead of by governmental authorities. Then we collect data and elements to reconstruct Bitcoin’s history as a cryptocurrency, starting from the mysterious story surrounding its birth. We then follow its spread and development through social networks and words of mouth, together with its sudden booms and bursts, finally to suggest that both users and institutional regulators should be aware of the risks of Bitcoin and of its alleged power to challenge our very notion of money.