Written by True Market Insiders
Digital currencies can be created at any time.
Which is why the number of cryptocurrencies available over the internet is approaching 1,000 and growing.
The most popular and considered the first digital currency is Bitcoin. It also happens to be the most valuable.
In fact, just this past week, Bitcoin’s market value hit $96.7 billion according to Coinmarketcap.com. Its market capitalization has now surpassed major stocks such as Goldman Sachs (GS) and Morgan Stanley (MS).
For something that’s virtually created out of thin air and really has no intrinsic value, it’s quite remarkable to think that people are now paying more than $5,000 to own just one Bitcoin.
Of course, many folks are skeptical of the cryptocurrency “revolution” and think it’ll end very badly (think “Dutch tulip bulb mania”).
One such critic is Jamie Dimon, the CEO of JPMorgan Chase, the largest bank in the United States.
“Bitcoin is a fraud,” Dimon said recently.”It’s just not a real thing, eventually it will be closed.Currencies have legal support, it will blow up.”
Mr. Dimon is not the only prominent figure who feels that way. Ken Rogoff, Professor of Public Policy and Professor of Economics at Harvard University, thinks that the price of Bitcoin will “collapse.”
“Increased efforts from governments to rein in virtual currencies could eventually contribute to a decline in speculative interest in the digital asset,” he said.”The long history of currency tells us that what the private sector innovates, the state eventually regulates and appropriates.There’s no reason to expect that virtual currency to avoid a similar fate.”
Rogoff may be on to something…
Regulators in mainland China and South Korea have recently begun cracking down on platforms that allow people to buy and sell digital currency.
