I well know, O Jehovah, that to earthling man his way does not belong. It does not belong to ma who is walking even to direct his step. –Jeremiah 10:23
Nowadays, Bitcoin draws attention and becomes an investment vehicle. More and more people join this game. Does Bitcoin have a promising future? Different people interpret from different perspective.
Without financial backup, it is very difficult for Bitcoin to become a hot topic because it is just like a P2P application invented in IT circle. No one knows who is the biggest supporter.
My personal opinion is that Bitcoin is not easy to become a mainstream currency. We need to take into accounts of the following factors.
- Bitcoins are monopolized by some Bitcoin miners or speculators. As a guess, rich people and international banks do not own Bitcoins. If Bitcoin became the mainstream currency, rich people and banks would become poor. I suppose they will not allow this to happen because Rich people and banks make financial game rule.
- There are only 21 million Bitcoins and its value will increase all the time. A slight inflation is helpful for economy. People want to consume because of inflation. The buying power of Bitcoins will become more because of fixed number of bitcoins. People will hoard Bitcoins and buy more goods in the future. This will be terrible for economy.
- The price of Bitcoins is not stable because of speculation. It is like a roller coast and will cause panic. It is not too difficult to control 2/3 of Bitcoins. The cost will be 21M x 2/3 x $1000 = 14B$. Even one speculator can collect this amount and push price higher.
- It is true that Bitcoins start to circulate in some areas. Who like Bitcoins? Drug dealers and criminals. Policemen can not trace their transaction. Kidnappers also appoint Bitcoins as their legal payment. These illegal business men are beneficiary of Bitcoin.
- Decentralization is one key to success of Bitcoin. Even though governments are corrupted, governments are still useful in some aspects. Without governments, Bitcoins will be the paradise for criminals. They will accumulate a huge amount of wealth.
Bitcoins points the direction for digital currency that governments are preparing and implementing. New technologies such as block chain was invented with Bitcoin. Block chain will be used widely with digital currency. Bitcoin already made contribution no matter it dies or thrives.