Is bitcoin the future of money?

9 February, 2015

With retailers more readily accepting bitcoin as a valid form of payment and BTMs (bitcoin teller machines) specially designed for it popping up all over the globe, the debate regarding the future of bitcoin remains heated.

Around the globe, governments continue to struggle with the concept of regulating bitcoin, whether it needs to be regulated and if so, how to do so. While some people continue to believe that bitcoin is nothing more than a passing fad, the evidence that bitcoin is actually the future of money continues to mount.

When the internet first made its entrance into the world, many people also thought that it would never become the vital element of everyday life that it has since become. The world of marketing and commerce itself has changed forever and all because of the internet.

So, what exactly is bitcoin? Is it actually money? Will it survive to become the future of currency? Currency is generally regarded as anything that holds value, acts as a unit of account and can be used as a medium of exchange. Given that bitcoin is now accepted by such heavyweights as and more retailers are jumping on board to accept it every day for all types of services and products, it would certainly seem that bitcoin meets the definition of currency.

The real question is whether it will be able to stand the test of time and eventually become a preferred method of currency. Along with purchasing items online, bitcoin also makes it possible to send small amounts to people in other parts of the world. Even better, you can do so without worrying about currency conversion fees and exchange rates. That alone is one of the most significant benefits of bitcoin.

Among the most common reasons cited for the ultimate failure of bitcoin is that it is not secure and could be hacked. The reality is that paper money is not secure. Due to the volatility of the electronic trading market, it can be entirely too easy for billions of dollars to be lost. That is not even taking into consideration the amount of money lost each year through bank robberies and other forms of theft. By comparison, the bitcoin blockchain technology is actually quite secure. As a result, the mainstream adoption and acceptance of bitcoin seems somewhat inevitable.

Other detractors of bitcoin complain that it is nothing more than a technological experiment. Although it could be easy to dismiss cryptocurrencies such as bitcoin as an experiment amongst the hacker community, current evidence would seem to indicate otherwise. If bitcoin were nothing more than an experiment, it seems unlikely that the US government and other governments would be interested in finding ways to regulate it.

Although the current definition of currency tends to rest on the concept of paper money, the truth is that the idea of currency has never remained static but has instead changed over time. In medieval England tally sticks were a form of currency. Other forms of exchange over the years have included bartering, gold, silver, and eventually paper money, known as fiat currency. Throughout history, currency has changed as newer and better systems have become available. Now that the digital age has fully arrived, the digital abilities offered by bitcoin appear to be a perfect fit for a modern society's needs. Ultimately, the real question seems to be not if bitcoin will become the future of money, but when such a transition will take place. You certainly do not have to buy into bitcoin, but the reality is that it is already changing the world whether you like it or not.