Bitcoin could replace money says UBS, but to do so it will have to ramp up 30 times

Last Updated: Fri, Aug 03, 2018 15:44 hrs
Bitcoin

Analysts at UBS, an investment banking firm, concede that bitcoin, a virtual currency, could some day supercede or even replace the Dollar.

But to replace the greenback, the Bitcoin's price must hit $213,000.

Bitcoin, known for it's volatile temperament, currently trades at $7378.85, and a thirty-time jump can replace paper bills, coins, and even travellers cheques.

But the virtual currency has taken sufficient blows after it's last year bizzare ascent and equally disappointing descent. For starters, it managed to flummox policy-makers and even users thanks to its volatility.

So far bankers have suggested that bitcoin is a hobbyists paradise and not meant for those interested in real trade. The reasons include bitcoin's underlying system and it's inability to process hi-volume transactions.

Although bitcoin proponents have argued for an economic system free of any central authority and encumberances, lower processing power, and reports of exchanges being hacked have busted the myth of blockchain and bitcoin especially being the unbreakable system.

There have also been concerns about the electricity consumption. Some called it as a 'catastrophic energy guzzler', others spoke of the 'environmental concerns'.

It is unclear, then how analysts could come up with such a bizzare hypothesis. Sify.com could not independently locate UBS' research, but a story published on Bloomberg, does manage to lend some credibility.

"Our findings suggest that Bitcoin, in its current form, is too unstable and limited to become a viable means of payment for global transactions or a mainstream asset class," reports a one-liner from the UBS report as cited on Bloomberg.

Reddit users found the story a worthy discussion. And here are some interesting snippets embedded from the social discussion portal.

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So far economists and leading investors have refused to acknowledge bitcoin. Nobel laureate Joseph Stiglitz, NYU's Nouriel Roubini known as Dr Doom, and Kenneth Rogoff former IMF Chief economist do not have positive sentiments on bitcoin. Warren Buffett, who usually scoffs at Gold as an investment avenue, has refused to acknowledge cryptocurrencies as investments either.

"The asset itself creates nothing," the CEO of Berkshire Hathaway was quoted as saying two months ago.

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