On Monday, bitcoin prices hit a record high at $2,100 per coin. On Wednesday, the cryptocurrency hit another milestone at $2,416 a coin. On Thursday, it peaked at $2,690. But if you ask Wences Casares, CEO of bitcoin wallet Xapo and member of PayPal’s board of directors, that’s nothing: bitcoin could hit $1 million per coin in the next five to 10 years.
“Put 1 percent of your net worth in bitcoin and forget about it for 10 years,” Casares advised during the Consensus 2017 conference in New York this week.
“The biggest mistake [would] be to buy more bitcoin than you can afford to lose. The biggest mistake is [also] not to own any bitcoin,” Casares said.
It’s a bold claim, surpassing predictions by Snapchat investor Jeremy Liew and Blockchain CEO Peter Smith, who said bitcoin would hit $500,000 by 2030. Still, the digital currency has gained 60 percent just this month and is up 185 percent for the year; maybe these predictions aren’t so bold after all.
Bitcoin.com attributes the surge to Japan’s recent acceptance of bitcoin as a form of legal tender.
Crytocoins News speculated that companies were hoarding bitcoin as insurance in light of the WannaCry ransomware attacks, which asked victims to buy back their data in bitcoin.
Jeffrey Gundlach, CEO of DoubleLine Capital, pointed to Chinese investors looking for safe investments outside the country as the yuan’s value continues to trail. Likewise, Cryptocoins News noted Monday that China, which had been lagging for months in the global bitcoin exchange, had made a comeback, now accounting for nearly a quarter of the global trading volume.
In reality, it’s probably a bit of all three factors and more.
Japan, Korea and Europe also fashioned themselves as heavyweights this week, to the concern of some who fear, in light of the WannaCry attacks, that North Korea may be stocking up on bitcoin. But the market was dominated by the U.S., which conducted almost one-third of all bitcoin transactions.
Other skeptics didn’t have any particular concerns about North Korea, but still felt — again as a result of the ransomware attacks — that it was time to regulate the cryptocurrency. And one economics professor, Jeffrey Dorfman, University of Georgia, simply didn’t think bitcoin made sense as a currency, no matter who’s hoarding it and why.
Dorfman believes that bitcoin makes more sense as a speculative asset than as an actual currency. People, he said, don’t feel secure about investments in a currency that fluctuates by nearly 50 percent monthly. Bitcoin makes a poor currency, he opined, due to its fluid value and slow transaction time.
While bitcoin’s value seems to be on an endless upward trajectory, the slow transaction time should see some resolution in the near future.
A pact announced this week promises to increase the size of the data blocks in bitcoin’s blockchain (enabling it to process more transactions at a time) and to activate a new verification method, Segregated Witness, that removes signature data from bitcoin transactions to make them smaller — so more of them can fit in a block.
Bitcoin isn’t just for computers anymore. Flesh-and-blood consumers can use it at a growing number of businesses across Europe, Asia and beyond.
BitPay announced on May 22 that it was expanding its prepaid Visa debit card offering to serve a total of 131 countries. The card can be loaded using cryptocurrency dollars which can then be used as euros, British pounds or U.S. dollars at merchants anywhere in the world. Fifteen thousand cards have already been ordered since the domestic product was unveiled in 2016, BitPay said.
Frequent fliers in Europe can now use bitcoin to book a parking space at 27 U.K. airports through SkyParkSecure, the first independent U.K. travel company to accept bitcoin for airport parking. Though the company doesn’t own or operate parking facilities, it does act as a booking platform and will now convert parking fees into bitcoin to complete payments directly from cryptocurrency wallets.
In response to popular demand, Alza, the largest online retailer in the Czech Republic and Slovakia, now accepts bitcoin in its online store and has even installed bitcoin ATMs in its retail storefronts, enabling shoppers to buy and sell bitcoins into euros and Slovakian crowns.
Meanwhile in Japan, bitcoin goes mainstream as the government recognizes it as a legal form of payment, putting an end to the 8 percent consumption tax formerly associated with the digital tender. Three hundred thousand Japanese stores are ready to accept payments in bitcoin by the end of 2017.
Following suit, Japanese discount airline Peach Aviation this week became the first in the country to accept bitcoin payments from travelers.
Also in Japan, OKI’s Recycler G8 allows customers to deposit cash into their bitcoin wallet or access their cryptocurrency wallet and withdraw cash. These cash-recycling ATMs take bills deposited by one customer and dispense the same bills back to others for withdrawal. OKI plans to sell 150,000 units to emerging markets in India and Southeast Asia over the next five years.