Even before Bitcoin became a well-known entity, its creators and proponents alike have long dreamed of the day that it becomes accepted as a legitimate currency. In the short while that it has existed, Bitcoin has gone from a fad to something that is, in most corners of the world, a household name. At no point prior to now has it seemed that, finally, Bitcoin might actually be accepted just like the USD, Euro, or any other globally accepted currency.
Unfortunately, Bitcoin’s move into mainstream legitimacy might be a bit further off than some people might think. A report recently publicized by a group of Morgan Stanley analysts indicates that there are some serious problems with the cryptocurrency, and that it is nothing more than the “poster child for speculation.”
Retail Use Stagnating
One of the biggest points that the Morgan Stanley report, which was headed by James Faucette, makes is that the number of major retailers accepting the cryptocurrency has not only stagnated in recent years, it has actually declined. According to the report, a little more than a year ago there were 5 large retailers that accepted Bitcoin.
Right now, that number has shrunk to just 3. Naturally, if Bitcoin ever hopes to become a currency recognized by the world, it is going to have to be actively used and accepted by retail outlets, whether they be brick and mortar or online.
Skyrocketing Value Does Bitcoin No Favors
Another “striking disparity,” as the report put it, is with regard to the small number of retailers accepting it and the skyrocketing value of the cryptocurrency. Over the past year, the value of Bitcoin has risen more than 200%. While there are many ways to interpret the shrinking number of retailers accepting the cryptocurrency and its rapidly rising value, the Morgan Stanley report indicated that this is not such a good sign.
Faucette went on to talk about how retailers are going to continue to be wary about accepting Bitcoin so long as there remains a large number of investors that simply hold on to the coin in hopes that it will appreciate and earn them a nice return. In addition to that, the transaction times with some BTC transactions can be enough to drive retailers away.
According to Faucette, “The ecosystem has focused more on value speculation rather than the foot-leather-eating work of increasing acceptance — way easier to trade speculatively than convince new merchants to accept the cryptocurrency.”
A little more than a month ago, Morgan Stanley made a statement saying that if cryptocurrencies want to be accepted as viable, legitimate investments, they will need to let stricter government oversight come into play, and soon. As you might expect, they did not go into any detail with regard to what they mean by “government oversight,” and instead left that up for interpretation.
As we move forward from this report, the battle over whether Bitcoin can ever be a legitimate currency or not will rage on ceaselessly. For now, there remains a stark divide between those that are massive proponents and those that think Bitcoin is worth nothing at all, and is just a fad.