Bitcoin Boom?

0:00U.S. is becoming increasingly concerned over virtual currencies, launching broad investigations into Bitcoin and the likes. Virtual currency is not going away and needs whole government response, that's according to participants of the inquiry run by a Senate committee on homeland security. Now unbanked and free from centralized regulation, Bitcoin has been gathering steam and pushing its way to the mainstream. Its value rocketed in April, this year hitting more than $200. However, Bitcoin's success is marred by worries it can be used to evade taxes and trade drugs and pornography. Lawmakers insist digital money should be brought out of the darkness and regulated, both in the interest of the public and the virtual currency industry itself. Economist Mark Thornton says the U.S. is just worried about the dollar.

0:49Their stated objective to investigate these currencies, these virtual currencies, is that The Theory of Money and Credit

1:25The Federal Reserve and the Treasury are concerned that in the long run, virtual currencies may siphon off some of the demand for the U.S. dollar, so the government is concerned about Bitcoin and its popularity at many different levels.