As promising as it may seem now, Bitcoin will crash, asserts Hamish McRae of the Telegraph. Its rise mirrors many classic aspects of financial bubbles that ended up bursting. It lacks many of the securities that traditional currencies offer. Past bubbles, such as the railway boom in 1840, did result in investors losing out as well as in something tangible and useful being created. Bitcoin has no value in itself. Its value is given by the market, which is attractive now, but could end in disaster later. The cryptocurrency seems exciting now as its value just hit $10,000 per Bitcoin, but its volatility could see this progress undone overnight.
Unorthodox, de-centralized and unpredictable, Bitcoin has befuddled everyone yet continues to grow and is likely here to stay, writes Derek Thompson in The Atlantic. Currencies have always only been as valuable as the value we attribute to them. Gold, iron disks, bead chains, plastic credit cards and money made of cotton are no different. As long as people continue to believe in its worth and use it, Bitcoin will succeed. Its unique nature, being untraceable and protected by blockchain, an online ledger that validates transactions and prevents fraud, make it highly attractive. Volatile, yes, but it has clearly bewitched the world and is here to stay.