time helping a staffer for
Senator
Tom
Carper
of
Delaware, who wanted to
hold a hearing on Bitcoin in
the Homeland Security and
Governmental
Affairs
Committee. A young aide,
John Collins, had gotten
excited about Bitcoin earlier
in the year and had been
holding private conversations
across Washington about the
technology. When Bitcoin
took off in the fall, it helped
Collins finally make the
hearing happen.
Collins and Patrick shared
a similar genial sensibility
and a dry sense of humor, and
they
fell
into
an
easy
relationship. Patrick made
sure Collins had all his
questions answered by the
most presentable people in
the Bitcoin world, including
representatives of all the
companies that had won
funding
from
venture
capitalists earlier in the year.
For the hearing, Patrick’s
goal was to present the most
mainstream image of Bitcoin
possible. He volunteered to
testify himself, alongside a
few other relative newcomers
to the Bitcoin world who
Patrick knew would say the
sorts of things that would
make lawmakers happy.
The night before the
hearing, Patrick had trouble
sleeping and kept rising to
make tweaks to his prepared
remarks. Patrick also worried
about the first part of the
hearing, which was a panel of
government officials whom
he had not been able to prep.
Over the summer, Patrick had
spoken with all the agencies
represented on the panel, but
he didn’t know if the lower-
ranking
officials
had
conveyed his message to their
bosses at the Department of
Justice
and
the
Secret
Service.
When Patrick got to the
hearing room and took his
seat in the audience for the
panel of government officials,
he was exhausted and jittery.
There were, though, already
good headlines trickling out.
In response to a questionnaire
from
Senator
Carper’s
committee, the chairman of
the Federal Reserve, Ben
Bernanke, had written down
his take on Bitcoin and was
surprisingly positive, praising
its
“long-term
promise,
particularly if the innovations
promote a faster, more secure
and more efficient payment
system.”
First up to testify was the
head of Financial Crimes
Enforcement
Network,
or
FinCen,
Jennifer
Shasky
Calvery, who had helped set
up
the
August
meeting.
Patrick had developed a good
relationship
with
Shasky
Calvery, but she was even
more positive than Patrick
expected, using his frequent
line that cash dollars were
actually the most commonly
used currency for drug deals
and money laundering. The
head of the Department of
Justice’s criminal division
went next and emphasized
that Bitcoin was not as hard
to track as many people
seemed to believe and had
many legitimate uses. Finally,
the
head
of
criminal
investigations at the Secret
Service said that his agency
was not overly worried about
its ability to deal with crimes
involving virtual currencies.
In response to questions
from Senator Carper, the
panelists pointed to all the
activity in China and noted
that if the United States came
down too hard on Bitcoin, or
pushed it out of the country,
the innovation would be
likely to move overseas to
places like China where it
would be harder to control.
By the time the first panel
was over, the Washington
Post already had a headline
that
read
“THIS
SENATE
HEARING
IS
A
BITCOIN
LOVEFEST.”
When Patrick and the
other Bitcoiners got their
chance to testify, Patrick was
still nervous enough that he
forgot
to
turn
on
his
microphone. But he had a
simple message for himself
that he repeated over and
over: “I’ve already won, just
don’t fuck it up. Just read the
script.”
He didn’t fuck it up, and
neither did the men sitting
next to him. The hearing was
streamed
live
over
the
Internet
and
Bitcoiners
watching it around the world
responded by buying coins
and then more coins, pushing
the price up as the hearing
went on. When Senator
Carper brought the gavel
down, the price on Mt. Gox
stood above $700, $150
higher than where it had been
that morning.
Patrick wanted to crawl
into bed but first he had to
make it through a series of
press interviews, including
one with a Chinese journalist
from CCTV.
THE NEXT MORNING, Bobby
Lee arose in Shanghai to
discover that BTC China
customers
had
responded
with more vigor than even the
customers trading dollars on
Mt.
Gox
and
Bitstamp,
sending the price above 7,000
yuan. In other words, since
the previous morning, the
Bitcoin price in yuan had
gone up more than it had in
the first five years of the
virtual currency’s existence.
Bobby raced to his office,
where there was already a
journalist from the Xinhua
News Agency waiting for an
interview. Everyone wanted
to know what Bitcoin was
and how long this surge could
continue.
After
the
interview,
Bobby grabbed Ling Kang, a
slight man who had become
Bobby’s all-around fix-it guy
since he came on two months
earlier, handling all relations
with the government thanks
to his incredible connections,
or guanxi as the Chinese put it. Once they were in the
glass-walled conference room
behind Bobby’s desk, they
gave each other dazed looks.
They both agreed that the
speculative frenzy, which had
once been exciting, was now
a potential problem. Unlike
officials in the United States,
Chinese officials had given
no encouraging signs about
Bitcoin. Also, compared with
those in the United States,
officials in China tended to
act much more swiftly and
decisively when they didn’t
like something. Bobby and
his deputy couldn’t help
recalling how the speculation
in Q coins had been shut
down. Communist officials
now had no shortage of
indications that Bitcoin was
the new Q coin. A story the
previous week in Xinhua had
said that even “Chinese
mothers” were plowing their
money
into