Bitcoin should be dead now following the hacking of the Mt. Gox exchange, Nicolas Colas, a managing director and chief market strategist at ConvergEx Group, told an audience at a presentation about the virtual currency hosted by the New York Society of Security Analysts on Wednesday. Instead of dying, the currency has bounced back, with its price increasing by more than $100 since it fell steeply after the collapse of Mt. Gox.
Although wide public acceptance has been elusive for Bitcoin, there is still enough demand for Bitcoin that not even the failure of Mt. Gox could dissuade that demand, Colas said.
[For more on the Bitcoin debate, read: After the Mt. Gox Collapse, Wall Street is Wary of Bitcoin]
“I thought we got to the point where Bitcoin was done after Mt. Gox, but its recovery since shows how durable it is. It’s a strong signal of the demand to own and transact in Bitcoins. [The demand] is global, so it doesn’t depend on the U.S. news cycle,” he explained. “At the end of the day, you have to respect that [high] price.”
Bitcoin has several strengths related to its anonymity and ease-of-transfer that have fed its global demand and kept it strong. That strong demand -- and the fact that Bitcoin’s systems involved in creating the currency are extremely secure -- means that Bitcoin is here to stay, Colas noted in his presentation. And the currency could really take off in the future if regulators figure out how to treat the currency and a more secure way of trading the currency is found, he added.
[To hear about how financial firms are managing their complex data architectures, attend the Future of the Financial Services Data Center panel at Interop 2014 in Las Vegas, March 31-April 4. You can also REGISTER FOR INTEROP HERE.]
Bitcoin’s usefulness for international payments is one of the sources of its allure, according to Colas. He called Bitcoin “the best way that has been found so far to send international payments.”
...Read the full story on Bank Systems & Technology Jonathan Camhi has been an associate editor with Bank Systems & Technology since 2012. He previously worked as a freelance journalist in New York City covering politics, health and immigration, and has a master's degree from the City University of New York's Graduate School ... View Full Bio