Tremendous “speculative mania” appears to be engulfing markets for cryptocurrencies such as bitcoin. You may not realise that such currencies are mostly attractive to criminals and speculators. So why the hype?
Blockchain, as technology underpinning bitcoin, could one day support a digital currency that may pave the way for efficient alternatives to cash currency. We acknowledge that unregulated cryptocurrencies are attractive to criminals that operate in illegal black-market operations such as drugs and worse. Even the RBA is not convinced at this time for an electronic dollar to operate in tandem with physical banknotes but says in time, a new form of digital money – a variation on exchange settlement accounts may come into fruition.
These serious concerns as made by financial institutions, finance commenters and the like that bitcoin – which has increased in price from about $US800 at the start of the year to more than $US17,000 – was mostly used by criminals, is not regulated and the price increases have been escalated by speculators. We think that extreme caution should be exercised with Bitcoin as an investment for these obvious reasons as this smells very much of the same of “Tech Boom & Bust”. On the other hand, the technology of Blockchain is going to generate further interest & investment for years to come.
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