> This play only makes sense if someone is extracting the actual currency value of a Bitcoin somewhere along the line.
I would think that's the very point. And it's not like there wasn't a precedence in the physical world already.
Stamps.
I still remember when stamps were occasionally used as a fractional currency. You could order small things over mail and send payment as stamps.
This phenomonenon was even used by Terry Pratchess as a minor plot detail in Going Postal, and subsequently in Making Money. The idea was dead simple: stamps had real value. Eventually, someone would need to spend it to actually mail things, but until then people could use them as a form of microcurrency. So a single unit might be "spent" several times in unofficial transactions before getting used for its intended purpose. The stamps weren't any more valuable as such, but their added utility made them useful in a wider setting.
There's some talk about the history in [0], and slightly better researched in [1].
I would think that's the very point. And it's not like there wasn't a precedence in the physical world already.
Stamps.
I still remember when stamps were occasionally used as a fractional currency. You could order small things over mail and send payment as stamps.
This phenomonenon was even used by Terry Pratchess as a minor plot detail in Going Postal, and subsequently in Making Money. The idea was dead simple: stamps had real value. Eventually, someone would need to spend it to actually mail things, but until then people could use them as a form of microcurrency. So a single unit might be "spent" several times in unofficial transactions before getting used for its intended purpose. The stamps weren't any more valuable as such, but their added utility made them useful in a wider setting.
There's some talk about the history in [0], and slightly better researched in [1].
0: http://message.snopes.com/showthread.php?t=16067
1: http://en.wikipedia.org/wiki/Fractional_currency_%28United_S...
EDIT: one more, this time something recent and still practiced - pre-paid call time as currency: http://www.economist.com/news/finance-and-economics/21569744...