We’re still living in what future historians will call the earliest era of the Internet age, and it’s still too early to predict exactly how that will play out, which aspects of contemporary web life will remain and which will fade away. But evidence is growing that virtual currency Bitcoin (or some future variant of it) might be a permanent part of the virtual landscape, rather than a flash in the pan.
Indeed, analysts with Bank of America Merrill Lynch released a Dec. 5 report suggesting that Bitcoin has the potential to become “a major means of payment for ecommerce” and a “serious competitor to traditional money transfer providers.”
Bank of America certainly isn’t the first to take an optimistic view of Bitcoin’s future; the day before the report, CNNMoney reported that former congressman Ron Paul said Bitcoin might “destroy the [U.S.] dollar,” and predicted a crackdown because “Governments absolutely demand a monopoly on money and credit. They're not going to give it up easily ….They will come down hard."
Arguably, “they” already have; last May, the US government froze funds at the largest Bitcoin exchange, due to vague and undescribed reasons cited by the Department of Homeland Security. On the other hand, even those wont to distrust government secrecy must admit there are some legitimate, non-tyrannical reasons governments might want to crack down on Bitcoin: namely, anti-fraud measures, On Nov. 6, the New York Times’ Dealbook warned readers about a “pump and dump” penny-stock fraud scheme being played out on Bitcoin.
Cracking down on fraudsters is difficult enough with traditional banking and its extensive paper trails; in the anonymous world of Bitcoin it may be close to impossible.