After extracting $65 million from Facebook Inc (NASDAQ:FB) in the courts for their disputed involvement in the early stage development of the firm with founder Mark Zuckerberg, Tyler and Cameron Winklevoss have “discovered” the next really big thing that will eclipse Facebook: Bitcoin.

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2014 is the year Wall Street takes on Bitcoin

“Bitcoin is a protocol for decentralization, so you could build a decentralized company on top of it, a stock market. It’s an internet of ownership, so it’s not quite a direct comparison,” Tyler Winklevoss said in an interview published in the Guardian.  2014 is the year Wall Street will get involved in the Bitcoin, the twins predict.

The twin’s “predictions” that Wall Street might be a little less crystal ball and more pointing to what is already occurring, as major firms in both Chicago and New York have been considering how to create a market structure for Bitcoin that dampens volatility through a more consistent pricing structure and market making system.  Volatility is a major concern among investors. Recent Goldman Sachs statements that Bitcoin is too volatile to be a success come as financial insiders wrestle with the difficulty market makers might have in hedging the digital currency and payment processing method. Currently a variety of markets display different prices, which begs a sophisticated high frequency trading firm to enter the picture and arbitrage the various price discrepancies and provide liquidity, a prospect that has been discussed among algorithmic traders.

While volatility is an issue actively being wrestled by financial minds normally concerned with price arbitrage in stocks and commodities, the Winklevoss twins don’t’ see it as a problem. “Calling bitcoin volatile – it’s a non-statement. Unregulated assets with unclear regulatory landscapes are always going to be volatile. That’s what unregulated assets do,” said Winklevoss. “I can make the same argument about the internet in the early days. But sure enough, technologists came and worked hard at the problem, and it’s getting better.”

Bitcoin “discovered” while partying

As if considering themselves the Columbus of Bitcoin, the Winklevoss twins apparently regal in telling the story of how they “discovered” the internet while partying the day away in Ibiza, a Mediterranean island off the Spanish coast with a reputation as a hub for electronic music and late night partying among Europe’s young, rich and idol class. “We were on vacation, and happened to bump into a guy who is mutual friend and he started to tell us about bitcoin,” Tyler Winklevoss explained in the interview. “We were fascinated from day one.”

The twins parlayed their Facebook Inc (NASDAQ:FB) court win to acquire nearly 1% of all Bitcoin in existence, which currently represents nearly a $57 million stake. The two think that the same way Facebook encouraged us to be socially open, Bitcoin encourages us to be financially open. “Bitcoin potentially could be more impactful because being able to donate 50 cents to someone across the world has more impact than potentially sharing a picture,” he explains. “But they’re very different. Facebook is like the internet – a large company and an application.”

Mt Gox was a failure to execute

When considering Bitcoin’s most “painful” experience, Tyler Winklevoss says the Mt Gox failure was good for Bitcoin in general.  The twins stopped using Mt Gox when the withdrawal process became painfully slow, then he hinted at a potential business involvement.  “We essentially came up with a method which we think is the most accurate way to price Bitcoin at that moment in time, and we’ll use that price to help create price discovery and stability in the Bitcoin ecosystem.”

Just like the Vikings are said to have discovered America before Columbus, the Winklevoss twins might be a touch late to this party as financial firms have been noodling this problem for several years.  The question is: who will execute the best market making system first and dominate the industry?  That is yet to be determined.