Perhaps one of the most enigmatic trends to hit the technology and finance worlds in recent memory, the viability and future direction of Bitcoin is still very much up in the air.
Still yet to break into the mainstream, the spread and uptake of Bitcoin has certainly been slower than its developers would have hoped. A series of controversies, such as the closure of the major Bitcoin exchange Mt. Gox earlier this year, haven’t shed the cyber currency in the best of lights either.
However, experts continue to rally behind Bitcoin, with many banking on it to eventually represent the future of money and forever change how everyday transactions are conducted. What are some of the latest predictions and likely developments surrounding Bitcoin?
Will it actually replace real money and banks?
To date, Bitcoin has remained a highly niche currency, with its main proponents being investors and tech gurus who have a strong handle on its complexities.
In order to really enter the mainstream, however, it needs to prove it can be used an everyday currency, readily and widely accepted by retailers and other merchants. So are there actually any businesses already accepting Bitcoin as a form of payment?
A limited number of retailers, mostly in developed regions such as North America, have been taking Bitcoin payments from its customers for some time now – indicating that with the right development, there could well be a future for everyday transactions to be made via this medium. The main advantages of Bitcoin, such as the quick and efficient nature of transactions and the use of Bitcoin ‘wallets’ for ease of use, could be vital factors in this push.
However, the majority of Bitcoin users currently see it as more of a commodity rather than a currency, as a way to hoard value rather than to facilitate day-to-day payments. Given this widely held perception, it could be some time before we see Bitcoin flashed in public on a regular basis.
When will it be regulated?
One of the greatest debates surrounding Bitcoin is whether or not to regulate it. The growth of the currency has had people calling for a central body or system to regulate it, and this could be a necessary step if it is ever to be taken seriously as a mainstream currency.
However, the main sticking point here is that regulating Bitcoin would actually defeat its whole purpose. Arguably the biggest selling point of Bitcoin is its decentralised nature, as its freedom from banks and similar bodies has allowed for smooth and instantaneous transactions, practically no red tape and, perhaps most appealingly for consumers, little to no fees.
With security and related issues coming to light as Bitcoin grows, the call for regulation will only become stronger, and it will be interesting to see in which way this battle heads.
How will the threat of crime be managed?
Some of Bitcoin’s key traits – such as the fact that transactions are anonymous and virtually untraceable, for instance – allow for unprecedented levels of convenience and privacy, big pluses for the everyday consumer.
Unfortunately, these very same characteristics are also piquing the interest of criminals, cyber or otherwise.
There have already been fears raised about how a range of criminals, from drug traffickers to money launderers, can use Bitcoin as a way of conducting their illicit activities while being effectively shielded from law enforcement. In fact, one of the biggest Bitcoin exchanges had been dedicated to the trade of illegal drugs, although this has since been shut down.
Such concerns promise to raise plenty of questions for developers as they continue to push Bitcoin into the mainstream.
Find out more about Bitcoin and its supporting technology at the upcoming Cryptocon Summit & Barcamp.
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