By Antonio Prieto
Bitcoin. Since it’s anonymous and cryptic dark web birth in 2009, it has shaken up the global economy. Launching a whole new genre of tech ventures (including peer-to-peer lending firms and payment systems), Bitcoin has established itself as a solid peg under the global economy. But is it just a fluke?
A prominent and well-known “feature” of Bitcoin is it’s unstable and constantly fluctuating price. With a sub-zero USD price until mid-2012, Bitcoin took off in 2013 reaching ~$1150/bitcoin by November 2013. Unfortunately, this price slipped over the next year and by November 2014, the price had fallen to $400. According to Coinbase, the price currently sits at $236 (May 21st, 2015). With such a clear and prominent downhill trend for Bitcoin, many prospective investors are left questioning the integrity and economic value something like Bitcoin and cryptocurrencies have.
To fully comprehend the value of Bitcoin, one must overlook it as an investment and more as a revolutionizing economic tool. Bitcoin’s decentralized nature, which allows for no single entity to manipulate and control the source of Bitcoin, is one of its most enticing features. The pure fact that Bitcoin alone can lead to a truly free and open marketplace is what attracts not only investors, but economic innovators. Since it’s spawn in 2009, the Bitcoin promise has fueled multiple revolutionizing startups including Bitpay, a payment process that allows for businesses, both small and large, to accept Bitcoin online and in storefront locations with ease, and Coinbase, the first Bitcoin marketplace to partner with prominent Wall Street stock exchange, the New York Stock Exchange.
While the entrepreneurial prosperity is in abundance, Bitcoin, and other cryptocurrencies have caused headaches for federal regulators. With such a new and untested product as is Bitcoin, many regulators are unsure of how to approach Bitcoin in a way that doesn’t cause significant economic disturbance. Many regulators have proposed placing Bitcoin under minimum regulation with others, specifically in New York with the BitLicense, taking significant regulatory leaps. BitLicense is a proposed list of regulatory restrictions on Bitcoin under New York state law. These restrictions are currently being proposed by The New York Department of Financial Services. BitLicense’s most notable restriction is that it would require, as the name says, a state mandated license to receive, transmit, store or convert Bitcoin and any other cryptocurrency.
For many, such a mandate goes directly against the original purpose of a Bitcoin: an unregulated free and open currency for all to use regardless of socioeconomic status or any other factor. Many advocates of Bitcoin believe that any such restrictions placed on Bitcoin would crush the currency and deem it worthless for mass adoption by the public. To fully analyze this issue, one must step into the shoes of both regulator and supporter.Bitcoin, a currently untamed and undeveloped creature, has the potential to cause significant economic disruption and while the technology is astounding and innovative we must ensure that if Bitcoin were to fail, our global economy holds stable and cannot be shaken up from an experiment such as Bitcoin.
Over its short, but fast moving six-year life, Bitcoin has set the groundwork for an absolute economic revolution on a global scale. The fact that such an ambiguous and masked currency can cause such movement in an already crowded global economy shows the absolute economic value and potential Bitcoin and other cryptocurrencies alike have.
To truly empower Bitcoin and ensure its long-term growth and economic revitalization of the struggling fiat-based global economy, the general public must come on board and open their minds to the possibilities and advantages a tool such as Bitcoin could have on the future, but we must also support the regulation of Bitcoin to ensure any error in the experiment of Bitcoin does not properly shatter the current state of economy. To learn more about Bitcoin, please visit: https://bitcoin.org
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