These last weeks, local newspapers have carried several articles about cryptocurrency. I imagine that many will have tried to understand how bitcoin works, but speaking for myself, illiterate in the science of economics, I was not much wiser at the end of the reading.

Just to shed more confusion, there was the announcement by BOV and BNF that they were suspending transactions in Bitcoin, with no reasons given.

Some weeks ago, I read Yanis Varoufakis’s latest work, Talking to My Daughter About the Economy (TMD). Coming from Varoufakis, the title should fool nobody, particularly people familiar with his two recent best sellers: And the Weak Suffer What They Must?: Europe, Austerity and the Threat to Global Stability (2016) and Adults in the Room: My battle with Europe’s Deep Establishment (2017).

Varoufakis, as many will remember, was minister for finance in the Tsipras cabinet that negotiated Greece’s bailout with the troika (IMF, ECB EU) and, of course, the German Finance Minister Schäuble. He resigned when his colleagues in the team accepted the troika’s terms, which to Varoufakis were nothing short of a noose around Greece’s neck.

TMD offers a clear picture of the evolution, operations and travails of market economies from Mesopotamia to the present day. Towards the end of the book, Varoufakis brings up Bitcoin, mentioning its original launch in 2008 by means of an algorithm published by Satoshi Nakamoto (a never-yet-traced nom de plume ).

The point of Bitcoin was to have a currency free of the political control governments exercised on it, directly or through central banks. It is the holders themselves who act as the “guardians” of the currency – a purely digital one with holdings as digits in a computer file.

The Nakimoto algorithm sets an upper limit to the number of Bitcoins which it can handle, their value being the equivalent of the Gold Standard of pre-1929 Great Depression days.

In the few Bitcoin trading days to date, there have been many warnings from traders that this is a bubble that will burst very soon

Since the middle of this year, there has been a veritable fanfare of Bitcoin trumpets announcing huge gains in the value of Bitcoin and rehashing rags-to-riches stories of Maltese taxi drivers or indigent students who bought Bitcoin several years ago.

So huge and so fast has the value of Bitcoin increased that ‘traders’ are now offering ‘part’ Bitcoin for those who have less than $15,000 to invest. And just a few days ago, two important US exchanges started trading in Bitcoin.

What to do? Varoufakis, while admitting the “anarchic anti-establishment, counter-authoritarian” attraction of Bitcoin, insists that those very features – involving the very core of politics – ultimately demolish the argument that Bitcoin is a “non-political” currency.

After some initial hiccups, there remain other problems. Perhaps the worst is that the Bitcoin supply is ultimately limited by the nature of the generating algorithm. In case of another 2008 crash, for instance, the money supply in a Bitcoin economy cannot be increased.

The usual way out of such a situation, an increase in the money supply – as happened in the case of the 1929 economic crash when countries left the gold standard – would not be available, perhaps not even possible, making an orderly exit from the crisis very difficult.

Seeing what has happened since 2008 – despite concerted efforts, countries are still struggling to get back to sunnier economic climes – the prospect of a Bitcoin crash would seem to be rather apocalyptic. In the few Bitcoin trading days to date, there have been many warnings from traders that this is a bubble that will burst very soon.

So would it not be to everybody’s advantage, seeing that some local politicians are looking forward to the adoption of this currency, if some local, authoritative voices explained to us how this currency works, what its advantages are, what possible dangers lurk between the folds, how Bitcoin would co-exist with the euro and how they would counter Varoufakis’s arguments?

This would go a long way to allaying current doubts and fears while helping create the faith and trust without which no economic venture can hope to succeed.

Edward Mallia is honorary chairman of Friends of the Earth (Malta).