Riding the Cryptocoaster

A primer on cryptocurrency, written together with colleague Carlo Cocuzzo. Download here, summary below:

Is Bitcoin real money? Will it reach FX stability? As investors are scratching their heads, we show why trust is ultimately the key component for its development.

  • The Distributed Ledger Technology (DLT) will transform the way we pay, clear and settle transactions.
  • Digital Currencies (DC) may become real money in the future, but there are still some missing elements.
  • Bid-ask spreads on Bitcoin (BTC) exchanges are still quite high, suggesting far-from-ideal liquidity conditions.
  • The “trust problem” is still proving a bit of a headache for the Blockchain community, but we will likely see further developments on this front in the future.
  • But the big elephant in the room is the absence of a central bank.

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