The rise of bitcoin’s value past the $US10,000 mark is likely to strike fear into Australia’s banks and traditional financial institutions, according to one bitcoin trader.
Bitcoin trader and founder of digital currency exchange Bitcoin Babe, Michaela Juric, said banks would likely see the rise of bitcoin and other cryptocurrencies as a threat.
Ms Juric told Canstar that following today’s “huge milestone”, bitcoin will smash through $US11,000 by the end of the year.
“From my side of the fence, it’s always been a well-known fact that banks don’t like bitcoin – they see it as a threat,” she said.
“With the ongoing rise, adaption and government regulation of bitcoin and bitcoin brokers, it’s going to legitimise the business and whole process of bitcoin.
“I think that’s something the banks are going to be quite fearful of.”
BREAKING: Bitcoin tops $10,000 for the first time in Bloomberg pricing https://t.co/xUnklzt2mG pic.twitter.com/Nehv6pWy3u
— Bloomberg (@business) November 29, 2017
The bitcoin trader said most people using the cryptocurrency at the moment were investors, but that was starting to shift as everyday people realised it was quite easy to get into.
“I’ve seen quite an influx of older people like grandparents coming through my business,” she said.
“It’s ease of access – originally bitcoin had that stigma like the weird seedy guy in the bottom of the basement, but now we’re coming out of that phase and seeing it’s realised potential.
“Microsoft, Dell and a few other major corporations are taking it more seriously and that’s giving more people confidence to invest.”
Canstar’s General Manager of Wealth Josh Callaghan said as the currency continued to gain momentum, it would likely capture the attention of more and more investors each time it reached a new milestone.
“Coinbase, a popular crypto exchange, now has over 13 million users which is double what they had a year ago and the pace of acquiring new users continues to grow,” he said.
“FOMO is most likely fuelling much of the recent surge among investors, although there are increasing numbers of hedge funds and institutional investors now gaining exposure to cryptocurrency.
“We will likely see a few more ups and downs, however, I’m pretty confident we’ll see the bitcoin price continue to rise overall through 2018.”
Excited by the #Bitcoin buzz? Here's a cautionary tale… pic.twitter.com/ymKixGMwNI
— News Breakfast (@BreakfastNews) November 20, 2017
While popularity and value seem to be rising, bitcoin buyers have been warned by economists around the world to be aware of the volatility of bitcoin.
Last week, AMP Capital head of investment strategy and chief economist Shane Oliver said there are “serious grounds for caution”.
“Its price now looks very bubbly, particularly compared to past asset bubbles.
“Because bitcoin is impossible to value, it could keep going up for a long way yet as more gullible investors are sucked in on the belief that they are on the way to unlimited riches and those who don’t believe them just “don’t get it” (just like a previous generation said to “dot com” sceptics).
“Maybe it’s just something each new generation of young investors has to go through – based on a thought that there is some way to instant riches and that their parents are just too square to believe it.”
Try our Investor Hub comparison tool to instantly compare Canstar expert rated options.
This advice is general and has not taken into account your objectives, financial situation, or needs. It is not personal advice. Consider whether this advice is right for you, having regard to your own objectives, financial situation and needs. You may need financial advice from a suitably qualified adviser. For more information, read Canstar’s Financial Services and Credit Guide (FSCG) and our detailed disclosure. Canstar may receive a fee for referring you to a product provider – for further information, see how we get paid. Payment of fees for ads does not influence our Star Ratings or Awards.
Canstar is a comparison website, not a product issuer, so it’s important to check any product information directly with the provider. Consider the Product Disclosure Statement (PDS), Target Market Determination (TMD) and other applicable product documentation before making a decision to purchase, acquire, invest in or apply for a financial or credit product. Contact the product issuer directly for a copy of the PDS, TMD and other documentation.
Canstar is an information provider and in giving you product information Canstar is not making any suggestion or recommendation about a particular credit product or loan. If you decide to apply for a credit product or loan, you will deal directly with a credit provider, and not with Canstar. Rates and product information should be confirmed with the relevant credit provider. For more information, read the credit provider’s key facts sheet and other applicable loan documentation for that product. Read the Comparison Rate Warning.
The views, opinions, and positions expressed in this piece are the views of the author(s) alone, and do not necessarily reflect the views of Canstar.
All information about performance returns is historical. Past performance should not be relied upon as an indicator of future performance; unit prices and the value of your investment may fall or rise.
Any advice provided on this website is general and has not taken into account your objectives, financial situation or needs. Consider whether this advice is right for you. Consider the Product Disclosure Statement and Target Market Determination before making a purchase decision. Canstar provides an information service. It is not a credit provider, and in giving you information about credit products Canstar is not making any suggestion or recommendation to you about a particular credit product. Research provided by Canstar Research AFSL and Australian Credit Licence No. 437917. You must not reproduce, transmit, disseminate, sell, or publish information on this website without prior written permission from Canstar.