Bitcoin Soars To Astronomical Highs With Virgin Galactic

on November 23 2013 10:36 AM
 Virgin Galactic's VSS Enterprise/SpaceShipTwo on maiden glide flight
Virgin Galactic's SpaceShipTwo Virgin Atlantic

Virgin Galactic, the space program brought to you by Sir Richard Branson, announced Friday that it is accepting payment in Bitcoin, already having one customer, a “female flight attendant from Hawaii,” purchase her ticket in BTCs. Virgin Galactic is the most recent business to start accepting the highly controversial digital currency. As Branson notes in his blog post, the University of Nicosia, a Cyprus-based private school, is now allowing students to pay for tuition and fees in Bitcoin as well.

Branson’s endorsement comes in two parts: accepting them for his business and as he has personally invested in them. “For people who can afford to invest a little in Bitcoins, it’s worth looking into,” he recommends. Branson, the biggest name so far to endorse the currency, gives some legitimacy to the volatile tender. However, critics of the digital currency have cited the lack of transactions, not the lack of participating merchants or endorsements, as the main reason to avoid Bitcoins.

Currently there are 12 million BTCs in circulation. However, there are only roughly 70,000 transactions daily, meaning people are holding onto the currency instead of spending it, which doesn’t bode well for the economy of the currency. If this was something that was a recent trend, where people were only holding onto their BTCs while the value soared, then the lack of significant transactions could be overlooked.  However, as far back as 2011, Nobel Prize-winning economist Paul Krugman saw the lack of transactions and called BTCs out for it.

“What we want from a monetary system isn’t to make people holding money rich," Krugman said. "We want it to facilitate transactions and make the economy as a whole rich. And that’s not at all what is happening in Bitcoin.”

This week saw BTCs reach a meteoric all-time high of $900 before going through a quick dump that slashed prices down to $450, only to bounce back to $750, where it currently hovers. This fluctuation doesn’t appear to worry Branson though. Instead he compares the currency with his own space-bound airline.

“Virgin Galactic is a company looking into the future, so is Bitcoin. So it makes sense we would offer Bitcoin as a way to pay for your journey to space.” 

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