There has been a lot of ink spilled over the last two years about the emergence of cryptocurrency, a form of digital bits and bytes that will replace the US dollar as the next world reserve currency. One or two will inevitably succeed over time, but while that battle is fought, an awful lot of money will be lost by speculators gambling in this sector. At last count, there were 1,610 digital currencies listed on the Coin Stats app, with a combined market capitalisation in excess of $400BN. I expect 90-95% of these will prove to be worthless. Maybe a handful will succeed. Maybe the next digital reserve currency has yet to be created. Maybe the one that does succeed will be a digital currency backed by physical gold. Does 'bitcoin' have the appearance of a physical gold coin to create a sense of credibility for the currency?
Some of the smartest minds in Global Tech are working on developing solutions in this sector. I have no doubt they will succeed and we will move to a cashless society with one or more digital currencies over the next 5-10 years. In the meantime however, the rampant speculation in the crypto market has bubbled over. I expect that 'bitcoin' will trade under $4,000 (down from $8,700 today) before it makes new all time highs, if that ever happens and the vast majority of the other digital coins will disappear into the ether.
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