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Bitcoin's backers know they need to win you over

Zach Miners | March 26, 2014
New applications are needed for wider acceptance, investors recently said.

Also, if companies working in Bitcoin want to see wider use of the currency, more protections should be put in place to verify the security of the technology, according to some speakers at the conference.

Andreessen Horowitz's Srinivasan said the firm would be interested in funding an "underwriters lab" for Bitcoin, which conceivably could provide electronic audits and safety testing for Bitcoin exchanges and other companies that might otherwise become the victims of hacks, as some reports called Mt. Gox. The idea has some support.

"These fundamental infrastructure components need to exist before [Bitcoin] apps can truly thrive," said Hemant Taneja, of General Catalyst Partners.

Some Bitcoin companies are trying to tackle these concerns. Coinbase, a Bitcoin exchange, wallet and payment processor that is backed by several high-profile investors, has pledged to provide quarterly security audits by outside firms. A recent review of Coinbase's system said it was operating according to security best practices.

Above all, Andreessen said his firm viewed Bitcoin as an ecosystem capable of providing a range of applications that might not even use actual bitcoins, such as peer-to-peer money-lending networks. One of the firm's goals is to build a portfolio of investments in all areas of the ecosystem.

Meanwhile, average people need to become more comfortable with Bitcoin and aware of its potential, he said. People were skeptical of the Web in the early '90s, he said. But by 1995 or 1996, he said, "they said, 'oh, this is pretty cool.'"


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