Header Ads

Trust God

Bitcoin...............Does it meet the Test for Being Money?

bitcoin.gif


Investor pro Doug Casey, founder of Casey Research, has changed his perspective on what Bitcoin is and is not. Previously, Casey held a mixed view of cryptocurrencies, doubting if they had the basic principles that make a currency.

However, after further research and consideration, Casey has affirmed his view that Bitcoin is, indeed, money. This evaluation is based on five principles that make up a currency - durability, consistency, divisibility, convenience and usability.

Among these five criteria, Casey says, he has always believed that Bitcoin meets all of them nicely, with the exception of usability. His concern previously was that Bitcoin had little real-world use cases. Casey, however, has changed his mind, saying:

“The problem I had with Bitcoin to start with was the fifth point: does it have use value in itself, so you can’t get stuck holding the bag? And I said that was the problem with Bitcoin. But I was wrong about that… The bottom line, Bitcoin passes the medium of exchange test for the moment and store of value test for the moment. So you can definitely say it’s money—for the moment.”

Bitcoin destined to fail?
Casey’s comments reflect the opinions of other analysts, including the Economist, which echoed Casey’s comments, saying that Bitcoin is indeed money. The article used tests for value based on the famed economist Charles Kindleberger, who wrote the quintessential analysis of bubbles in 1978.

Casey, however, goes on to say that the reality is that Bitcoin can and will change. He concludes by saying, “I have little confidence Bitcoin will be here say five years from now.”


FIRE:  

Here is what I think about the survival of Bitcoin.  Bitcoin is paper money with about 1,119 children - other cryptocurrencies.  Most of these children are not for settlement like bitcoin, but they are mostly built on the same blockchain platform - Decentralized network.

Bitcoin was created to ease the various bottleneck that bankers and administrative structures placed on money transfer by adopting a decentralized platform to effect fast and cheaper transfer of money.

Bitcoin 's main challenge is that it is not issued by any government and the banks do not have control over it, yet people, businesses have accepted it with ease because of its simplicity.  

The high volatility of bitcoin is also caused by it nature.  It is a revolutionary development which has been accepted in brazen disregard of authorities and state structures.  So the authorities consider it risky and porous. So, when authorities and highly placed individuals criticize it, the investors react in panic.

Yet, from what I can see, bitcoin and crypto currencies can only be stopped if computers and the internet can be stopped.  They are based on blockchain....and structured to survive on their own. It was not created to be fiat money or compete with fiat money. Bitcoin was created to solve a problem and as long as the problem persist, its relevance will continue.

I think Bitcoin will survive! 


FIRE...



Powered by Blogger.