Bitcoin is a cryptocurrency that has been around since 2009. The original ideal of the technology was a completely egalitarian, decentralised currency that could put enterprises, individuals and countries of different sizes and statuses on a more equal footing. As mining, buying and using Bitcoin has become more widespread, to a degree the opposite has happened.
More conventional institutions have gotten involved in regulating the cryptocurrency, which means there is a greater chance that investors could lose their money and more opportunity for moderators to intervene. The utopian concept of not needing to answer to government regulations seems to be on its way out.
Whether by the ruling authorities in a country, specially established boards or existing fiscal bodies, if Bitcoin is to be used extensively it is going to require some kind of management and supervision. This is not the only way that Bitcoin is similar to mainstream finance; central bankers and other experts warn that, like other assets before the cryptocurrency, Bitcoin could be existing in a bubble that could burst.
The Chicago Mercantile Exchange is set to introduce Bitcoin derivatives, which are essentially a form of bet on the future of its value. The derivatives will be in place before Christmas 2017, and will open the way into the market for hedge funds. Speculating on how high the value of a Bitcoin will go and trading accordingly definitely makes Bitcoin more like a store of value and less of a currency, as do the ideas of total equality and getting in on some of the finite number of Bitcoin before they are all gone. In the words of PricewaterhouseCoopers’ Ajit Triparthi, “Bubbles are driven by sentiment and stories, and Bitcoin has a great story with a lot of mystery and spectacle”.
If Bitcoin is like the dotcom bubble of the late 1990s or the tulip craze of the 17th century, then there is still a way to go before it peaks. The collapse of something that has no intrinsic value other than what it is assigned by a community of its owners is, in many experts’ opinions, inevitable, but perhaps not quite yet. Bitcoin’s current market cap is $170 billion, whereas tech stocks were valued at $2.9 trillion before the dotcom crash of 2000.
Trading is still profitable but Bitcoin’s volatility, which has seen its price climb to $11,000, plummet to $9,146 and then rebound to $10,700 in recent times, makes it very difficult to know how long that will be true for. In many ways Bitcoin trading is just as much of a gamble as playing slots and other casino games is, and in both cases the key is knowing the right time to quit.
Like all modern trading Bitcoin transactions can be conducted on mobile devices, something else that trading with the asset has in common with modern gambling. Being able to play anytime and anywhere, thanks to smartphone and tablet technology, has influenced the demographics of casino users considerably. People who can’t get to land-based casinos and have not been able to play in the past can now do so to their hearts’ content, and those who are very busy can squeeze in a few games on the go whenever their schedule allows. In addition, playing at a mobile casino can be kept a lot more secret than walking through the doors of a land-based establishment can, which is very important to certain players.
Perhaps the most revolutionary thing about mobile gambling, however, and its biggest commonality with Bitcoin trading, is that both activities appeal to the elusive millennial audience much more than their traditional counterparts do. Using mobile devices to complete tasks isn’t even considered the hip way to do things anymore; increasingly it is the accepted norm and the only way these youngsters have ever known. Mobile casinos and Bitcoin trades are both riding that wave, and when it crashes is anyone’s guess.