While opinion remains divided about the future of Bitcoin, analysts believe that cyber currency is here to stay, whether it is through the experimental Bitcoin exchange or a future clone.
The digital currency, which enables instant payments to anyone across the globe, has seen rather wild fluctuations in recent weeks as analysts, regulators and investors grapple with its relevancy.
Bitcoin has seen highs exceeding $1,000, but quickly fell back to $500 before moving to a level at around $700.
Last week, the People’s Bank of China announced it was barring the country’s banks from dealing in Bitcoins.
However, in the US, Bank of America became the first top local financial institution to cover Bitcoin, in a note to clients, when analyst David Woo estimated a maximum fair value of $1,300 and a maximum market capitalisation of $15 billion.
“Bitcoin to me is a Canary in the Coal Mine of what we are going to face over the next ten years, or 20 years, which is cyber currency,” said Bloomberg political analyst Matthew Dowd.
“And whether nor not Bitcoin lasts…cyber currency is here to stay, and somebody is going to be the next Bitcoin and the next Bitcoin, and the next Bitcoin,” he said.
He said that the critical mass is going to come out into the open on cyber currency, “there is no going back at that point, the horse is out the barn”.
The analyst noted that while government gets their share of the monetary take currently – that doesn’t happen with Bitcoin. Governments, he said, are going to have to get into bed with cyber currency at some point.
Former Federal Reserve chairman Alan Greenspan said that Bitcoin prices were unsustainably high, Bloomberg reported.
“It’s a bubble,” Mr Greenspan said in a Bloomberg TV interview. Bitcoin “has to have intrinsic value…you have to really stretch your imagination to infer what the intrinsic value of Bitcoin is. I haven’t been able to do it. Maybe somebody else can.”
Bitcoin South Africa appeal
A South African student made headlines last week when he used Bitcoin to pay tuition towards an online MBA Degree at the University of Nicosia.
On November 27, Francois Rossouw, a new UNic student in South Africa, made a payment of 1 BTC, the equivalent of EUR 670 ($910), toward tuition for an online Master of Business Administration degree.
“I am honored to be a part of this historical occasion. Being able to pay for a world-class tertiary education with Bitcoin was a dream of many but few believed that it would become a reality so soon,” said Rossouw.
In addition to accepting Bitcoin, UNic is also launching the first Master of Science Degree in Digital Currency in Spring 2014.
According to CoinMap, a few South African companies have already started to accept Bitcoin, predominantly in the Western Cape.
They include a paintball shop, a taxi service, Fire & Ice – Fire dancers Cape Town, an internet marketing company, and a tax consultancy.