Mtgox bitcoin to cash
Posted On 23.01.1966
Almost every other day, another article is published praising Bitcoin as the next great payment instrument set to overtake traditional currency as the preferred payment method of the masses. Recently, officials within the United States Treasury and Mtgox bitcoin to cash Departments have now recognized the virtual currency as legitimate and financially viable.
The value of a Bitcoin does fluctuate with the markets. But remember, all currencies fluctuate in value on a daily basis, so that’s not unique to Bitcoin. Will Bitcoin be around for a long time? WILL BITCOIN REPLACE CASH ANY TIME SOON?
You can have cash hidden under the mattress that gets burned in a fire. You can have gold jewellery which gets stolen. You could have a safety deposit box that your children do not know about. You could have money in a bank which goes bust. Well, you could opt for Bitcoins, a virtual currency which has no ties to any monetary authority, no underlying commodity and no fixed exchange rate. Now, more and more people are accepting payment in Bitcoin. Bitcoin is a technological wonder, an intellectually stimulating idea, and, at least theoretically, an economical way to transact payments.
So, is Bitcoin positioned to replace banknotes and coins? The value of Bitcoin fluctuates so regularly, and as shown in the chart below, so dramatically, that its risk factor is very high. To illustrate, in a 2013 article, Forbes reported that Bitcoin appears to be tracing the stages of a classic bubble chart. For comparison, Forbes presents the Bitcoin price chart from October to December of 2013 alongside the archetypal bubble stages chart created by Dr. Currency Research additionally looked into the claim that Bitcoin possesses certain attributes of cash that consumers desire, including security and anonymity. With the US federal government cracking down on Silk Road and many companies losing Bitcoins to hackers, popular claims that Bitcoin is unhackable and anonymous are now proving false. Many of Mt Gox’s 127,000 creditors, who feared they had lost their investments when the exchange filed for bankruptcy, are sceptical about what the exchange has said happened to the bitcoins it had.
Mt Gox blamed the loss of 750,000 bitcoins belonging to its customers and 100,000 of its own on hackers. Of late, defenders have stepped up to explain why Bitcoin will not, and cannot, replace cash. Bitcoin is not money in and of itself. Since the value of bitcoins are not in their usage as standard money but in their usage in transactions, bitcoins are only as good as the fiat currencies in which they can be sold. Merchants or individuals who accept bitcoins in foreign countries are betting that they can either exchange the bitcoins for something or cash them in for a more stable currency in the future as opposed to accepting local currency. Taken together, these factors indicate that Bitcoin is not well situated to replace cash as a payment method.
Currency Research believes that there has not yet been a viable alternative to replace cash as a payment method. However, Currency Research does not believe that central banks should ignore the world of technological cryptocurrency payments. Any central bank or mint needs to fully understand all implications of any payment method and be able to regulate it for consumer protection. Should a future alternative emerge able to viably replace the many benefits and consumer confidence in physical cash, the central bank or mint needs to be adaptable. Currency Research has not yet witnessed such a technology. This article has been posted with permission from Currency Research and is excerpted from The Case for Cash Part 1: Myths Dispelled.
To request a copy of the full report or to learn more about Currency Research, please click here. Enter your email address to receive notifications of new posts by email. The cash repository is supported by the non-profit trade association, ATM Industry Association, and other interested groups. Please contact us if you would like to contribute or have any questions. As a result, the web page is not displaying. If you are a visitor of this website: Please try again in a few minutes. Gox was a bitcoin exchange based in Shibuya, Tokyo, Japan.