How Long Till Bitcoin Replaces Cold Hard Cash?
More and More Smart Money Flowing into Cryptocurrency and Blockchain Tech
Bitcoin to Meet Growing Demand for Alternative Payment Systems
In the near future, a close cash substitute will be developed that will rapidly drive out cash as a means of payment. A contender is Bitcoin or some other cryptocurrency. While cryptocurrencies still have many drawbacks… these issues could rapidly disappear with the emergence of large-scale off-chain payment networks (e.g., Bitcoin’s lightning networks) and other scaling solutions.
Frank Talk Turns 11 Years Old!
Blockchain and Digital Currencies SWOT
Strengths
- Of the cryptocurrencies tracked by CoinMarketCap, the best performing for the week ended April 27 was Daneel, which gained 769 percent. Last week during an interview, Adena Friedman CEO of Nasdaq, said that “Nasdaq would consider becoming a crypto exchange over time.” Although it is unlikely to launch a service anytime in the near future, this is very positive news for the cryptocurrency market in gaining widespread adoption, writes Coindesk. “I believe that digital currencies will continue to persist, it’s just a matter of how long it will take for that space to mature,” Friedman added.
- Some of the world’s biggest cryptocurrencies rose again last week, reports Bloomberg. This extends their April rally deep into its fourth week, taking this month’s increase past 75 percent. According to Marc Ostwald, global strategist at ADM Investor Services in London, “The noise from regulators has been far less destructive in recent weeks than since the end of last year, and we haven’t had a big theft from an exchange recently.”
- Walmart Inc. is getting suppliers to put food on the blockchain, according to Frank Yiannas, vice president of food safety and health. As Bloomberg reports, the move would help reduce waste, better manage contamination cases and improve transparency. Another new use for blockchain technology is tracking jewels. From mines all the way to retail stores, four gold and diamond companies – Helzberg, Richline, LeachGarner and Asahi – are developing a network to do just that. These companies will use the TrustChainInitiative, running on IBM’s technology, to prove to consumers that their purchases don’t include blood diamonds or other conflict metals, writes Bloomberg.
Weaknesses
- Of the cryptocurrencies tracked by CoinMarketCap, the worst performing for the week ended April 27 was Global Cryptocurrency, which lost 41 percent.
- Bloomberg reports that some ERC20 tokens, which are based on the Ethereum network, could be susceptible to a bug in the system. These tokens encompass about 90 percent of the $53 billion token market, according to CoinMarketCap. On Wednesday, two exchanges suspended the ERC20 token, with one going back up the same day.
- Central bankers still don’t seem to agree on cryptocurrencies and how to regulate them, but they do agree that tokens such as bitcoin and Ethereum won’t replace traditional currencies. The IMF wrote in a report this month that, “while they may serve as a store of value, their use as a medium of exchange has been limited and their elevated volatility has prevented them from becoming a reliable unit of account.” Different approaches around the world to regulating cryptocurrencies would mean that the effectiveness of regulation is limited, writes Bloomberg.
Opportunities
- A litecoin trade is turning heads in the cryptocurrency community, writes Business Insider. In a single trade at the end of the week before last, $99 million-worth of litecoin was sent between two crypto wallets in a single trade. The trade cost only $0.40 and took around 2.5 minutes to complete. Users are pointing out that a similar transaction in traditional finance “would take days to clear, multiple parties to sign off and carry heft fees,” the article continues.
- The Federal Reserve Bank of St. Louis has conducted a new study breaking down cryptocurrencies and asking some of the biggest questions in the space today, reports CCN.com. The study includes an analysis of the control structure of various currencies and also looks into whether or not central banks will adopt cryptocurrencies as a form of payment. As the article points out, the study shows the bank as stating “we welcome anonymous cryptocurrencies, but also disagree with the view that the government should provide one.”
- Venrock Associates, a venture capital firm that grew out from the Rockefeller fortune, is setting its sights on investing in cryptocurrencies, specifically blockchain startups. Bloomberg reports that it is looking to invest some in tokens, but mostly in startups before issuing its own cryptocurrencies. David Pakman, a partner at Venrock Associates said that he thinks “this is one of the most transformative tech ecosystems and has the possibility of creating hundreds of companies worth billions of dollars each.”
Threats
- According to the Mosaic Network, cryptocurrencies’ “number-one problem” is the massive void in reliable research. Of course, there are books, blogs and critical media coverage on the space, but there still remains very little in the way of timely and rigorous 1) fundamental analysis of project teams and track records, 2) quantitative analysis of adoption and community traction, and 3) technical road-map risk assessment, to name a few, the article continues.
- Many large brokerage firms, such as Merrill Lynch and Wells Fargo, are banning their financial advisors from recommending cryptocurrencies. However, Jack Tatar, who is the co-author of “Cryptoassets” and was a Merrill Lynch financial advisor for almost 10 years, says “these firms will back-track their policies” eventually. Furthermore, Forbes writes that even though brokers can’t trade cryptos for their clients, they’ll go against their employers’ policies and advise their clients to make a personal investment.
- According to Coindesk, Capital Group, a financial services company with $1.7 trillion in assets under management has prohibited its associates from investing in initial coin offerings (ICOs) or initial public offerings (IPOs). The code of ethics says that there may be some exceptions to investing in IPOs, with no exceptions for ICOs. The ban could be positive with implications that the firm might invest in ICOs on behalf of their clients sometime in the future.
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When Roosevelt confiscated gold he blamed it on “speculators”. When Nixon took us off the gold standard he blamed it on “speculators”. Now that governments are able to track all activity on the internet, confiscation to curb the “speculators” is just a few keystrokes away.
They will make an example of “speculators” by also limiting their privilege to use the internet. The day when all of us will need to look into the camera for face and iris recognition to log in is not that far away. And then the system will tell us what we can and cannot see and do. As in the Soviet Union, only the politically correct will be wealthy, and that status can change in the blink of an eye.
Those who want to use wealth for security must still remember “if you can’t touch it, you don’t own it”.
This is already a reality in china. You basically need a “drivers” license to sign on to the internet there. In the usa almost every computer has a camera and definitely has a microphone or two which could do rough scans of the room.
When a title uses an enigma the answer is no, you have had Delta, Visa and the American Express company was itself founded in 1850 and Inventing money orders in 1857, replacing cold hard cash along with the travellers cheque in 1914, and launched its Credit Card in 1957 to compete with the Diners Club Card(Launched 1950). This company along with SEARs was one of the real innovators and market leaders in its time, unlike the oligarchs of the day such as Standard oil which was run by robber Barons, it was more akin to early Apple and until its investment banking period had a good reputation. Effectively postal orders and wired funds have existed as long as the telegraph and have not replaced money but become money and expanded what was money from silver and gold to anything which was considered a trusted store of wealth.
“How long till bitcoin replaces cold hard cash”? Gold and silver have a better chance of replacing cash then another “nothing fiat currency” like bitcoin!!!