Why There's Confusion Over Valuing Bitcoin - InformationWeek

InformationWeek is part of the Informa Tech Division of Informa PLC

This site is operated by a business or businesses owned by Informa PLC and all copyright resides with them.Informa PLC's registered office is 5 Howick Place, London SW1P 1WG. Registered in England and Wales. Number 8860726.

IT Life
11:50 AM

Why There's Confusion Over Valuing Bitcoin

Bitcoin presents a new type of nontraditional, highly technical, experimental, and global digital instrument to our already complex world. That should conjure excitement, not fear.

When I caught wind of Bitcoin as a newly minted MBA in the summer of 2012, I immediately scoffed. At the time, one bitcoin was trading at around $10, with a total market cap of about $50 million, which I thought was outrageous. It was a new, unregulated, "imaginary" Internet currency. Even though I initially rejected the idea as utopian, it stuck with me for some time thereafter.

Fast forward to early 2013, when the European banking crisis was reaching a fever pitch and Cyprus was on the verge of the first modern bank "bail-in." As the bitcoin price began to rise rapidly on a daily basis, and the situation in Europe continued to deteriorate, I decided to remove my "I know everything" MBA grad cap for an "I know nothing" crypto dunce cap. And boy, am I glad I did.

The more I read, watched, and listened to bitcoin experts attempt to explain the most confusing and thought-provoking advancement since the Internet, the more fascinated I became, not only with the idea of frictionless transactions, but also by the idea of stateless currency.

Given the complexity of bitcoin (economic, financial, political, ideological), there are many topics of discussion that deserve specific attention in their own right. The Digital Currency Council does an excellent job of providing an overview of these issues in its free courses. In today's piece, we will focus on one of my favorite, and most misunderstood, topics: bitcoin valuation.

Read the rest of this article on Wall Street & Technology.

Adam K. Wyatt is Chief Analyst and Editor at BullBearAnalytics, a division of Digital Currency Research LLC, an informational financial publishing firm focusing on digital currency trading, investing, and education. Adam graduated with a BA in Economics and Political Science ... View Full Bio

We welcome your comments on this topic on our social media channels, or [contact us directly] with questions about the site.
Comment  | 
Print  | 
More Insights
Oldest First  |  Newest First  |  Threaded View
User Rank: Ninja
1/1/2015 | 7:37:10 AM
You will see more certainty in Valuation of Bitcoin in the coming future

Bitcoins on their own are a most fascinating topic.

In  the Future you will see more traction in this space (including proper and more stable valuations of the Currency) as it gains more users/followers .

I have seen Bitcoin ATMs sprouting up in Vancouver,NYC,San Francisco.

Not just that even Paypal Accepts payments in Bitcoins today[I am sure there are many more such cases of adoption happening as we speak].

As Bitcoin grows its value will become more and more stable.

Look at all the initial Volatility very simply as its initial teething troubles before it becomes more popular and widespread.


User Rank: Ninja
1/4/2015 | 9:00:15 PM
Re: You will see more certainty in Valuation of Bitcoin in the coming future
Bitcoin's value should be determined by the underlying technology it provides for banking innovation, and not simply by its use as a payment mechanism. With bitcoin, there is immense power in the blockchain, the transaction protocol and in its ability to be sent globally. That's where the worth of bitcoin really comes from. 
User Rank: Ninja
1/6/2015 | 12:35:03 PM
Re: You will see more certainty in Valuation of Bitcoin in the coming future

The Greatest power of Bitcoin is the fact that no Single Government has control over the whole operation(&That it is so liquid).

Hence,all those folks who don't trust their Government and want to circumvent Capital Controls most effectively use Bitcoins today.

I could tell you so many cases of Folks in Countries like Argentina and Venezuela(which have gotten ruined Economically thanks to the foolish mistakes of their Leaders ) have atleast managed to protect their Savings because they were held in Bitcoins rather than Venezuelan Bolivars which was simply Devalued by the Government according to their whims and fancies.

That's a massive-massive success for the Currency.

Augmented Analytics Drives Next Wave of AI, Machine Learning, BI
Jessica Davis, Senior Editor, Enterprise Apps,  3/19/2020
How Startup Innovation Can Help Enterprises Face COVID-19
Joao-Pierre S. Ruth, Senior Writer,  3/24/2020
Enterprise Guide to Robotic Process Automation
Cathleen Gagne, Managing Editor, InformationWeek,  3/23/2020
White Papers
Register for InformationWeek Newsletters
State of the Cloud
State of the Cloud
Cloud has drastically changed how IT organizations consume and deploy services in the digital age. This research report will delve into public, private and hybrid cloud adoption trends, with a special focus on infrastructure as a service and its role in the enterprise. Find out the challenges organizations are experiencing, and the technologies and strategies they are using to manage and mitigate those challenges today.
Current Issue
IT Careers: Tech Drives Constant Change
Advances in information technology and management concepts mean that IT professionals must update their skill sets, even their career goals on an almost yearly basis. In this IT Trend Report, experts share advice on how IT pros can keep up with this every-changing job market. Read it today!
Flash Poll