Cryptocurrencies might well be the epitome of the saying ‘overnight success takes 15 years’. In the case of Bitcoin, the most infamous and famous example, it took 12 years.
When Bitcoin came to our attention back in 2009, cryptocurrencies were looked upon with deep suspicion. Its creator, Satoshi Nakamoto, was, they said, probably a cover for the funding of the Silk Road and was therefore illegal.
On the back (or perhaps in the wake) of Bitcoin, other cryptocurrencies emerged, and even though the suspicion turned to cynicism, the value kept increasing. Of course, there were setbacks, and of course, people lost money, but the trend was ever upwards until Bitcoin passed the ten, twenty to forty and now fifty thousand dollar mark.
And reactions ranged from mild tutting to wild enthusiasm.
Now we have reached the stage when all the big boys, who have been watching with interest, are making their moves.
Cryptocurrencies, designed to circumnavigate central banks, are now being actively promoted by, er, central banks, on the basis that if you can’t beat them, join them. Two or three years ago, Bank of England Governor Mark Carney went as far as suggesting a global cryptocurrency among central banks.
While this is still under discussion, the People’s Bank of China is ready to launch, part of a strategy to internationalise the yuan.
Perhaps more importantly, corporates are getting behind the concept and investing big bucks in supporting cryptocurrencies. Most notably, Tesla made a significant investment in crypto, which triggered an equally significant price rise, particularly for Bitcoin.
More recently still, Visa is making noise about several initiatives in the crypto space, while just a year ago, it was keeping very quiet about the whole thing.
PayPal is moving too. In fact, the only initiative that is going backwards is the Facebook project, which is more to do with regulators worrying about even more market power than about the project itself.
The result – and an interim result at that – is that cryptocurrencies, measured by market capitalisation, are worth over $2 trillion, about the GDP of Italy.
Whatever you used to believe about cryptocurrencies and however cynical you might be, the writing is on the wall and has now been inked in.
Cryptocurrencies are here to stay and, over the next ten years, are likely to become very mainstream indeed. So, we had better get ready.