Some people on the sidelines of the alternative or digital currency phenomenon may be able to relate to one of the songs made famous by Johnny Cash and the Grateful Dead, on separate occasions, that is. The song title is Big River, and the first lines are:
Now I taught the weeping willow how to cry,
And I showed the clouds how to cover up a clear blue sky.
And the tears that I cried for that woman are gonna flood you Big River.
Then I’m gonna sit right here until I die.
The Man in Black performed Big River in his final performance back in 2003. Today, the opening line of the song may sum up the feelings of folks who have yet to invest directly or indirectly in what is known as digital ledger technology (DLT) otherwise known as blockchain technology.
One of the direct methods is in buying a currency such as bitcoin. This is not for the faint of heart. Since I last wrote on this topic here, bitcoin skyrocketed up to nearly $20,000 and just recently was trading for less than half that price. Today, it is dancing around the $12,000 mark.
Predictions about the future of digital currencies abound. Some believe that they will crash and eventually become worthless. Some critics go so far as to liken it to the tulip craze of early 1700s that ended badly. A more apt comparison, in my view, can be made to the dot.com era of the late 1990s which ended in the tech crash of 1999. However, it’s also important to note that while there were many tech companies that did not survive the bust, there were others that did and made early investors shed tears of joy.
Today, there are some who believe that the price of bitcoin will rise to $25,000 or more with some calling for $100,000. Now that could buy a lot of tulips!
Jamie Dimon, CEO of JP Morgan Chase, was one of the highest profile critics of bitcoin last year calling it a fraud at one point while being among those who used the $100,000 price target. Ironically, as bitcoin continued its ascent, the estimated combined value of bitcoin surpassed that of Dimon’s bank. Ouch!
Shortly after the New Year, Dimon told Fox Business that he regretted calling bitcoin a “fraud” and then went on to make this observation: “The blockchain is real,” Dimon said according to a Newsweek report. “You can have cryptodollars in yen and stuff like that. ICOs [initial coin offerings], you got to look at every one individually.”
Meanwhile, Bloomberg reported that Dimon’s bank as well as Citigroup and Goldman Sachs, in what was termed a Wall Street win for blockchain technology, “completed a successful six-month test in the $2.8 trillion equity swaps market” using blockchain technology.
My advice to savvy business leaders is to be open-minded to the use of blockchain technology in their businesses and industries. Likewise, if you have and R&D department, be sure it’s on their radar screen.
Disclosure: I own crypto currencies as well as shares in DLT-oriented companies. Note that I am not a broker-dealer, stock market or investment advisor, nor your financial nanny.
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