With a misunderstood value, and an incredibly volatile price, bitcoin has taken the financial and tech world by storm. Stories of paying for pizza with 10,000 bitcoins fills the market with uncertainty as to how real of an investment bitcoin can ever be, and whether or not it can fill the niche of a digital financial market.
Although there are those who are skeptical of the market, it does continue to show incredible price action. The value of bitcoin is rising quite dramatically, and does not look to be slowing down anytime soon. Some countries have begun to ban the currency, mostly because they don’t fully understand its use and how they can utilize such a groundbreaking technology.
On the other hand, companies have begun to learn how to use the currency, and have begun to create and use tech associated with digital currency. This includes the ability to pay for groceries, gasoline, dinner, or even a cup of coffee. One of the main issues with this however is the volatility of the currency.
If a business wants to charge a certain amount for a product, and then the next day, the price of that currency goes down by 20%, their product is suddenly worth that much less. The big companies that have begun to accept bitcoin, one of which being Starbucks, only do so through a third party that converts the currency to cash. This ultimately does not provide a real breakthrough for the technology, but rather a step in the right direction.
Bitcoin is not a fiat currency, like the dollar or euro, rather it is only based off of its liquidity and whether or not people want to buy it on the other end. Until the currency is widely accepted, it will be a challenge to move forward with it.