This chapter examines the role of Bitcoin exchanges, focusing on the infamous Mt. Gox and its eventual collapse in 2014. It highlights the centralization issues that contradicted Bitcoin's original principles and the implications of misplaced trust in exchanges on user confidence and the cryptocurrency ecosystem.
Nathaniel Popper of the New York Times and the author of Digital Gold talks with EconTalk host Russ Roberts about Bitcoin. Can Bitcoin make it? What went wrong with Mt. Gox? Why did Ross Ulbricht, the creator of Silk Road, just get sentenced to life in prison? Why are venture capital firms pouring millions of dollars into companies promising easier ways to use Bitcoin? Popper discusses these questions along with the technical side of Bitcoin to help listeners understand why so many investors are excited about the potential of Bitcoin.