Bitcoin is having a wild ride right now. Partly due to the euro crisis, and partly due to a lot of press coverage, some people seem to be taking a keen interest in the crypto-currency — in the last week, its value in relation to the U.S. dollar has shot up by almost 60 percent.
As I mentioned the last time I wrote about Bitcoin, I’m not an economist: I’m a technology journalist who is intrigued on a technical level by the theory and mechanics behind a distributed, algorithmically-generated “currency”, and that makes me want to track it and occasionally cover it when the tech angle is strong. Now, I don’t actually own any Bitcoins, but what if I did?
If I were to own stock in a tech company (I don’t, by the way) and I found myself writing about said company, I would at the very least be obliged to put a disclosure into the article — in fact, I would probably just avoid writing about the firm altogether. However, bloggers and journalists don’t follow that convention with currencies. Imagine an American journalist covering the fortunes of the dollar, and putting in a disclaimer to say that all her savings are held in USD – it would seem daft.
So I posed the question on Twitter earlier: “What are the ethics of writing about Bitcoin if you’ve bought some (I haven’t). Does it require stock-style disclosure?” Some quickly responded in the affirmative:
@superglaze I disclose my Bitcoin holdings when I write about them.
— Timothy B. Lee (@binarybits) March 22, 2013
— Natasha (@riptari) March 22, 2013
Whereas others were more circumspect:
— Nate Lanxon (@NateLanxon) March 22, 2013
There’s some serious debate going on about whether or not Bitcoin actually is a currency, but I (like the U.S. Treasury Department, it seems) feel that it is, albeit an unique one. Its uniqueness stems not only from the way in which its creation is automated, but also from its current volatility and, crucially, the fact that people don’t generally understand it very well. We all know what nationally-issued currencies like dollars and yen are, and we don’t need the concept explained to us every time we read an article about them. The situation with Bitcoin is very different.
I strongly suspect Bitcoin’s meteoric rise in recent weeks is largely an echo chamber effect — coverage begets coverage — which puts those writing about it in an unusual position. We bloggers and journalists have an extraordinary amount of influence in people’s perceptions of Bitcoin and, as a result, the trajectory of its value. For that reason alone, I think any coverage from a writer who has bought into Bitcoin should come with a clear disclosure.
That said, my colleague Tom Krazit also brought up an interesting tangential point in discussion, suggesting that writers covering Bitcoin may actually have an obligation to buy into it on a low level, so they can conduct a few transactions and basically have a clearer idea of what they’re talking about in their coverage.
This is all clearly a new and unusual field to explore, so I’d be interested in hearing further thoughts on the subject.