Day three in Davos, Switzerland at the World Economic Forum finally turned up the attention on Bitcoin and blockchain technology.
Parsing the $550 billion cryptocurrency market requires more articulation than generic name-calling about criminals, since Bitcoin and other cryptocurrencies like Ethereum have become legitimate assets, anointed by Wall Street.
Goldman Sachs is both warning clients about cryptocurrencies while also preparing their first crypto trading desk. Robinhood, with millions of millennial customers, announced plans to launch their crypto trading mobile app in February.
Concluding that cryptos are just for tax dodgers is worse than lazy; it’s out of step with reality. Bitcoin holds promise as an experiment. And as an experiment, it is a nine-year-old child struggling to mature and develop in a house full of domineering adults who doubt its validity (and often wish for its death).
With more adoption and more blockchain solutions, the economists and scholars at Davos are wrestling with Bitcoin as something more than a mere rebellious teen jabbing at subversion.
When millennials view paper money as crusty and old, like a VHS tape or a typewriter, what springs to mind is the notion of financial instruments and transactions undergoing their own Netflix-ing and Spotify-ing. Blockchain, Bitcoin and cryptocurrencies are here. They can evolve, improve and reach scalability. They can touch every sector where money is transacted and trust is required.
The goals: efficiency, transparency and trust – and no more replays of the 2008 financial crisis. The challenges: mitigating ICO fraud, hacks and attacks, criminal activity and tax evasion – challenges that currently exist with fiat in every corner of finance and society.
Highlights from the debate:
We should adopt a currency system like Chile’s Unidad de Fomento.
Bitcoin is a lousy form of currency.
Bitcoin isn’t disrupting money; it’s disrupting gold.
Japan has declared that Bitcoin is a currency.
Bitcoin is deflationary, so as a store of value it is very efficient.
Bitcoin has the ability to help many, many people.
The problem it’s trying to solve: being exposed to currencies that are moved around at the whim of governments.
This is the infancy stage of a potentially multi-decade project.
We overemphasis Bitcoin’s pricing.
The technology is promising, but it is not a very well-spread payment method.
People don’t trust the central bank completely.
Because of Bitcoin, because of cryptocurrency, it’s provoked a lot of people to think: What is money? Where should money come from?
It’s an experiment, and one sure way of making it fail is if too many people lose their life savings.
People should be able to use the payment methods they find safe and efficient.
Going from a cash society to a non-cash society where notes and coins are no longer useful is a new society.
The enthusiasm for Bitcoin is like a bubble.