Bitcoin Forum

Or so I suspect, at least.

We've just seen large investments in US-based bitcoin companies by savvy VC firms. Circle and Coinbase are both saying that they're going to make bitcoin easier for people to acquire and use. I'm sure they'll be successful in that, but they're also probably targeting next-gen uses of the blockchain (see Naval Ravikant, Co-founder/CEO of Angellist's "The Internet of Money": http://startupboy.com/2013/11/07/bitcoin-the-internet-of-money/ ). Seeing some real apps along those lines will drive another wave of excitement, and convince yet another slice of the populace that bitcoin has merit and is here to stay.

Along the way, someone is going to solve the money-transmission licensing problem. The reason we don't have any solid US-based exchanges is due to state-by-state MTL requirements, and specifically, the surety-bond coverage requirements for businesses to obtain such licenses. Either Coinbase, Circle, or some new well-funded entity will go through the expensive work of getting the licenses, or start a fund/company that's knowledgeable about bitcoin and willing to underwrite the bond coverage. Solving this problem will lead to much better liquidity in the US, and allow for some of the next-gen services outlined above, as well as advanced trading and hedging.

That leads to the beginning of real integration with Wall St. It seems like they're *starting* to shift from completely mocking bitcoin to dipping their toes in the water. They need *much* better liquidity to do anything significant, but unleashing real US exchange platforms will make that possible. Additionally, vehicles like SecondMarket's Bitcoin Investment Trust are already proving popular, and that trend will continue. The potential issue of near/medium term regulatory uncertainty was removed with last month's senate hearings, and further financial integration and products will come as a result, in due time.

In any event, these things are all inter-related and tend to snowball. The hard parts of getting the ball rolling and reducing regulatory uncertainty have already happened.

China can do what they want; I think it's far more likely that the US ends up housing the most robust and sophisticated bitcoin ecosystem.

I think it will be driven by Cyprus and the bitcoin bank there.

Once regulations hit, wall street can start adding to their portfolios with little risk of government intervention in addition to what you stated.  The problem is how long will this take to mature to that point?  Right now there is panic in the streets bc some guy dumped 3k coins...

I think the regulations have mostly already "hit". In the hearings, all agencies said they *already* have the legislative tools necessary to regulate bitcoin, and that it basically boils down to complying with existing AML/KYC/BSA stuff. The only thing left that's potentially relevant for Wall St. is classification as a currency or commodity. Shasky noted at the hearings that the IRS is actively working on explicitly defining tax consequences for bitcoin-related activity, which will likely involve weighing on the currency/commodity distinction (as silly as it is, obv) in some form or another. That may not fully answer the question, but it's a start. Not even sure how relevant it is (from Wall St's perspective), as long as the tax-treatment is clear.

Let's finish the bust first.

Eh, I'm not terribly interested in the short/medium term.

http://www.youtube.com/watch?v=IhnUgAaea4M

agreed.

Then why talk about the next boom phase? Let's just talk about million dollar bitcoins. ;)

+100 LMAO!

Awesome Movie! FUCK YEEAAAH!!

Heh... Well, the probability of getting to full success-case (which is a lot less than $1m/btc) is not 1.0, so I do like to ponder the process.

Not my intended sentiment, but....lol.

the stock market seems long overdue to pop, as the economy will sooner or later hit a very huge wall. i would guess that bitcoin could possibly reach $100,000/btc by that time.. but the question would be: in an economy with hyperinflation, how much does $100,00 buy you? maybe an xbox one?

Even the winklevii don't dare to speak for a price above 40k$ and yet everyone else is dreaming of 1m$ bitcoin...  ::)

lol, dont be surprised if you dont get one.

With over 42% of the US population aware of bitcoin, it makes sense that Bitcoin should probably be an American thing. Nowhere else, except european countries (where the Dutch apparently have 1% of the population owning bitcoin) is bitcoin so popular. And the legal/political system so free. :-)

True. Maybe I am biased as an american, but despite what the libertarians will tell you, this is still a very FREE country compared to many/most.  And America has made its history and fame on innovation. The internet started where? That's right. So did planes and cars and electricity etc. etc. etc.

So digital currency fits right in. We are a country driven not by manufacturing anymore but by investing in disruptive ideas and technology. 

America wants so badly to create, to matter in the world, that our leaders will not try to destroy bitcoin. We would rather brag about it.

I never ever felt comfortable with Bitcoin's reputation in the hands of communist China. Somewhat like Silk Road, I am pleased that China may be forced to take a back seat on the bitcoin express.

However, if any 2nd or 3rd world country like Cyprus would like to adopt BTC as their reserve currency then GO RIGHT AHEAD PLEASE and move to first class on this train.

I hope that whatever is dragging down the value of BTC is sorted out first before we can realistically talk about any future boom.I do a few things to earn BTC and at the moment,the value of what I've earned so far has dropped (quite a bit since £510 GBP yesterday) more than I'd like so It's safe to say that this could be a bust cycle.

What I do hope for is much cheaper BTC to buy up as an investment (as I didn't really have the means to do this last time so I have to get it done this time),hold onto them and profit as much as I can (think that puts me in speculator/earner category for BTC users and a former miner)

I hope the US really starts to embrace BTC and update it's legal systems to accommodate it like I've seen in the EU for a few years now (I live in the UK which is part of the EU).I see the future with BTC and similar (online) currencies as they gave me new oppourtunuties to help me earn while still sorting out how to get my foot in the TV industry (it's very tough,I've tried a lot to apply,got rejected,started making something of myself in the meantime until I get that dream job in TV).

As for which country drives BTCs success I really couldn't care less as long as the value grows and BTC is a successful,thriving currency (which so far it has demonstrated) :)

I reckon China's stance will also go some way towards encouraging India to do the opposite  :)

W8 , there are 150k+ bitcoin owners in the Netherlands?
Any source for this ? Cause I find it amazing

Also , I deeply believe that the EU zone will be the one that really drives mass adoption , not this speculation bubble in China!
We need real shops and real users , not day traders.

They have an SEC fund.  They are forced to speak conservatively.

Well, they don't actually have a fund, yet. That'll probably take a while (years?) to get approved, if ever. More likely that the first bitcoin-ETF we get comes from an already well-established firm producing and managing similar products.

But $40k/btc is not particularly conservative. And they even say they consider it a "small bull-case scenario". So they're thinking higher as their target success-case. But really think about what higher than $40k/btc would mean. That'd mean a market-cap of >$1T (at full 21m BTC issuance). As much of a long-term bitcoin bull as I am, I think the hurdles to getting significantly beyond that valuation are pretty high. Bitcoin would have to have fought, and won, many political battles, as well as the battles for mindshare among consumers, businesses, Wall St., etc.

Don't get me wrong - I think bitcoin is a powerful enough idea that these cases are theoretically possible, but I also think such success-cases, if they materialize, are necessarily a long way off.

For Bitcoin believers (i.e., us), I think this just comes down to an argument over what does "a long way off" mean? The Winklevii didn't give a timescale. A $1 million dollars per bitcoin (in today's dollars) does make sense as a kind of final, equilibrium valuation, and Bitcoin would need to have won all of the political, economic and technological battles for that to occur. Is it... 10 years away? 50 years away? 150 years away? $40k per bitcoin seems like a reasonable 5-10 year target (to me). $1 million per bitcoin could take over 50 years I think... major upheavals would need to have occurred and settled before we get to that point.

'Merica 8)

Yep I'm actively promoting it :P

We brought apartheid, orange carrots, colonized half the planet, sold your New York to the english for Suriname and we even sold tulips for more money than a street in Amsterdam .... we're definately into bitcoin :P

I have to agree, I know if Bitcoin get successfull the price can go over 100K
It is not about price, but about Bitcoin usefullness, when I see the number of miners and money put in mining equipment, I have little doubt about Bitcoin future

I'm a little late to this discussion, but I actually gave a presentation about Bitcoin and surety bonds at the Inside Bitcoins Las Vegas conference in December. A bonding solution is already available and you're correct, it is the well-funded entities mentioned that I'm working with. It's a long road, but the companies that can weather the storm, will come out on top.

I've also written about the topic on www.msbtalk.com.

Looks like it was Coinbase:
http://www.wsj.com/articles/first-u-s-bitcoin-exchange-set-to-open-1422221641

When the Coinbase exchanges goes live in 12 hour or so bitcoin will definitely hit 300 or so. Its about time we have major news to pump up bitcoin  ;D

But aren't the laws the strictest in US and Russia as well ?

It's really unclear what Russia's stance is. They *may* pass a law that imposes fines for using bitcoin in any way. Or not. We'll see.

As far as the US goes, the laws aren't "strict" for consumers. Owning and using bitcoin is not a problem. You get taxed on any capital-gains you may experience while holding bitcoin, but that's to be expected.

Where it gets ugly in the US is if you're running a financial service that uses bitcoin. If the business qualifies as a Money Services Business, you need to get separate licensing in every state in which you operate (ie, if you serve customers who reside in a given state), and that's very time consuming and expensive. Furthermore, in many cases, it's not even clear what businesses are classified as MSBs. Hopefully New York State's BitLicense proposal will clear some of that up, and potentially also trigger some convergence of money-transmission licensing rules between states, at least for digital currency businesses. We'll see.

Very, very nice call  8)

Nicely written article that I 100% agree with.

Wow dense...
The World Wide Web has been invented at CERN (Switzerland).

I don't know what you refer to by the term "car" but the first modern engine has been invented in Germany named "Ottomotor" as well as the first jet plane.

Airplanes have been invented by "Sir George Cayley" in England.

Bitcoin was also not invented in the USA. Americans are good at copying existing innovations nothing more. Now go on the street with a patriotism USA flag.