Winklevoss Twins Bite Into Bitcoin

Cameron and Tyler Winklevoss of Winklevoss Capital shed light on bitcoin, the mysterious digital dollar that's increasingly

as it continues to gain acceptance from online services and merchants, as well as their stake in the currency, on CNBC's Squawk Box Tuesday morning.  "A lot of people want to get bitcoin, but it's difficult, because you have to go to exchanges that are overseas in a lot of different ways," said C. Winklevoss, noting that a public ledger displays Bitcoin ownership for all stakeholders to view.  While Bitcoin is currently somewhat difficult to get into, the return is huge. When the Winklevoss twins bought in, their bitcoins were valued in the single digits, and now they're valued at over $300 each.  There are several exchanges where interested folks can buy into bitcoin, including Coinbase and others, said T. Winklevoss.  There are two important sides of bitcoin's growing popularity. One, is that many see digital currencies as the future of online trade, of which Bitcoin has been a pioneer for five years. The other is that many also equate its value with the properties of a gold, since it's mined and in limited supply.  The "miners" are devoted to a minting process that involves a computer algorithm using a specific computer that's built with the sole purpose of producing bitcoins, said C. Winklevoss. 

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As it currently stands, bitcoins are mined about every ten minutes. The limit of how many bitcoins that can exist is set at 21 million. Currently, there's a $4 billion market cap for bitcoin, with the potential to reach $400 billion.  T. Winklevoss cited the pseudonymous developer "Satoshi Nakamoto" as the one in charge of setting bitcoin's rules and limitations, and while no one knows Nakamoto, he said that the trust users have in Bitcoin is founded in the cryptography behind the technology, not the developer.  They're predicting accelerated growth in bitcoin's infrastructure and merchant acceptance over the next six months, despite the volatility the currency has seen.  "With the volatility comes a 2,000 percent return in the asset class this year. Um, it's young, but overtime as it gets bigger, and more mature, um, you're going to see the volatility decrease," said T. Winklevoss.  The ETF that the Winklevoss twins started is still in its process. They filed and amended the S-1 in October.