Thursday, January 25, 2018

Fortune Validates Our Prediction About Bitcoin

Although bitcoin has been around for a few years, it really wasn't a topic in mainstream conversation. It would get written about but it wasn't receiving daily news coverage.

In our predictions for 2018, we said that would change. We said bitcoin would not be mainstream -- by which we meant: cryptocurrencies are not something that most of us will invest in -- but it would generate lots of coverage. A lot more than in previous years.

That prediction came quickly true in 2018. Newspapers have been covering bitcoin on an almost daily basis this year. Fortune devoted its Jan. 18th issue to bitcoin.

Fortune even has a dedicated page on its website to bitcoin.

Check out the cover story: "How High Can Bitcoin's Price Go in 2018?"

For all the coverage and the interest in cryptocurrencies that rise and fall dramatically, we continue to feel they are a niche investment opportunity. Will bitcoin and its sibling cryptocurrencies thrive and take over from government-backed currencies? Certainly doesn't seem likely over the next decade.

But as we move away from using cash -- there are already some restaurants that don't accept paper currency; you have to pay electronically -- that may change, especially for people doing legitimate business across borders. The reason: banks add on fees on both sides of the transaction when American businesses pay international partners/vendors in dollars and that money has to be converted into local currency. Those fees can eat up -- unnecessarily, it seems -- a significant percentage of the transaction. With bitcoin, you avoid those fees because you don't need to convert from one currency to another. So we expect some legitimate businesses to push for the use of paying and accepting via cryptocurrency.

But there needs to be some standardization among cryptocurrency. 

And it needs to not be as volatile as bitcoin currently is. You don't want to accept a currency that drops 50% in a matter of hours, with no discernable reason.

No comments: