You don’t have to be a member of Generation Z to have heard about cryptocurrency, as it has grown increasingly popular and is rapidly being accepted at more and more retail establishments.
Digital currency is backed by nothing more than a complex computer algorithm but even the last vestige of the gold standard has long been abandoned by the United States. Therefore, understanding that fiat currency is now universal, many ask themselves, what’s the difference?
And because of that cryptos like Bitcoin have not only survived since its inception over a decade ago but thrived. As of this writing, we can see that one bitcoin is worth nearly 58,000 U.S. dollars. It is a staggering amount and has literally made early investors millions of dollars. Consider for a moment that only 13 months ago, you could have purchased a bitcoin for less than $6500, and now it has catapulted to more than eight times that amount.
And while Bitcoin has been a tremendous investment, the fact that it is being hailed as a legitimate currency in nearly all sectors to buy and sell goods will ultimately preserve it as a universal currency. Whether you want to use bitcoin to purchase a travel ticket through Expedia or make a wager on your favorite team, it is now a viable option to do both. Go ahead and cash out your BTC in a good sportsbook and be on your way. It is that easy and it is becoming even more seamless to do so in other industrial segments.
“Trading is interesting but it’s not nearly as interesting to us as a payments acceptance device. … [PayPal has] incredible merchant volume,” said James Friedman, a senior fintech research analyst at Susquehanna Financial Group.
Speaking of Susquehanna Financial Group, CoinDesk reporter Nathan DiCamillo, reported the following based on their findings.
“In December 2020, Susquehanna surveyed more than 120 small to medium-sized business owners to poll their interest in adopting bitcoin payments.
“More than 70% of respondents said they would accept bitcoin for payment at checkout if PayPal or Square enabled it, but around half of respondents said they believed there would be no impact on their business if they added the feature.
“Susquehanna also surveyed more than 100 American adults on attitudes toward cryptocurrencies… [and] found that nearly half of respondents would not purchase a product or service with cryptocurrency, while 5.5% of them would do so 10 or more times per year.”
Bitcoin is the lead dog in the cryptocurrency world but entrepreneur extraordinaire, Elon Musk, has recently been touting another digital currency, Dogecoin, as a hot commodity in the crypto world. But the truth of the matter is that Dogecoin, unlike Bitcoin and a few of the other major digital currencies, is more of a spoof than an actual vehicle to buy and sell goods and services. And that is why the preeminent cryptocurrencies, like Bitcoin, will ultimately prevail and remain standing while the others will stagnate as an idea that gets traded based on nothing more than the perception of its value with no ability to buy or sell anything of value.
Ryan Watkins, an analyst at bitcoin and crypto research firm Messari, wrote in early 2020, the following, “Institutional investors are the white whales of cryptocurrency, depending on your assumptions, an aggregate 1% institutional allocation to bitcoin can easily bring bitcoin’s market cap above $1 trillion. Ever so elusive, institutional investment in cryptocurrency has long been considered the most significant barrier between bitcoin and a multi-trillion-dollar market capitalization.”
Watkins also offered, “In anticipation of [institutions’] hopeful arrival, firms have raised more than $1 billion in order to build infrastructure to serve them. And deal activity is picking up as the perfect storm appears to be brewing for investment in bitcoin.”
It appears as though Bitcoin is not only here to stay but poised to dominate. And this could very well be the dawning of a new era where cryptocurrency is not only an option but the future of finance as we know it.
Is Cryptocurrency the Future of Finance?