A bitcoin’s value is determined by the people. So long as people buy into the bitcoin market, the value of bitcoins and the market grow. Businesses around the world are offering the virtual option right next to cash or charge, but as Northeastern University Professor of Economics Alan Dyer suggests, it’s not close to universal – not yet.
“I think until it becomes, what I call, more a store of value asset, rather than a medium of exchange asset,” Dyer says, “the future of Bitcoin is a little fuzzy right now.”
Dyer says it’s a niche market. Some people think bitcoins are cool, some are rebelling against the government and some are even using bitcoins to hide their money. Personally, he doesn’t think bitcoins will stick very long after those groups lose interest.
“I don’t mean to say that they’re frivolous or shallow,” Dyer says. “I would call it a digital curiousity, that’s given rise to some speculative behavior.” And there’s a taint now. Dyer says criminals are interested in bitcoins.