He’s not trying to make a buck, he’s trying to make a point.
But in a little over a week, a programmer named “Hendo” has created the most valuable digital currency in the world.
It’s called 42Coin, and one of them is already worth 1,000 Bitcoin, according to Cryptsy, which added the digital currency to its board yesterday. As of this afternoon, one Bitcoin was trading around $US900, meaning one 42Coin is worth about $US900,000. A full 42Coin has yet to be mined, and the prices are scaled up from the fractions of 42Coin that have been transacted (so don’t worry, no one has actually yet spent $US900,000 on one of these babies).
Here’s the chart — again, the “price” in the left-vertical axis is in Bitcoin, not dollars:
In an interview from his home in central Illinois, Hendo, who describes himself as a programmer and “professional [digital coin] miner” — he makes about $US60 a day — explained why the coin is so valuable, although if you don’t subscribe to the intrinsic value theory of digital currencies, you’re unlikely to be satisfied with his response: Because only 42 full coins will ever be mined, they are among the most scarce coins on the market.
“It’s unique — you’ll never see a full coin,” he said. Indeed, despite being more than a week old, the network has yet to mine a full coin. “It’s like seeing a goddman unicorn,” he said.
He added that it’s also “faster,” meaning it takes less time for a transaction in 42Coin — and there haven’t been many — to be confirmed on the network. While Bitcoin confirmations can take 10 minutes, and Litecoin ones two minutes, 42Coin transactions take 42 seconds. “So speed sets it apart too.”
But the project is not about money, he said, though admitted to owning some of the fractions of 42Coin that have been created himself, though insists most of it will be used for promotional purposes.
Rather, it’s meant to be a lesson about the digital currency world. As part of the launch, Hendo published a lucid critique of the monopolization problem in Bitcoin. Too often, he told us, new digital currencies are instantly monopolized by powerful mining pools, who then are able to effectively dictate prices to late joiners (we’ve been reporting on this recently).
The code for 42Coin, he said, was written in such a way that when powerful mining groups enter the 42Coin mining network, it instantly becomes more difficult to create units of the currency. When these groups leave, it gets easier.
“I’m trying to keep everything clean,” he said. “And I’d like this to be the precedent for all future coin launches. I see a lot of people getting cheated. It’s wrong,”
So why is it called 42 coin? There are only 42 of them. The number was made famous by Douglas Adams in “The Hitchhiker’s Guide To The Galaxy,” but the other half was that Hendo is a fan of Jackie Robinson.
Which confirms another theory about digital currencies: all celebrities will someday get their own.