- [Narrator] Bitcoin's meteoric rise
is attracting a ton of attention,
but is it ready for the mainstream?
JPMorgan Chase CEO Jamie Dimon recently called Bitcoin
a fraud and said that cryptocurrency prices
are in a bubble that will eventually burst.
Many investors have stayed on the sidelines
as cryptocurrencies are seen as too volatile
and don't have the safeguards that most financial assets do.
A number of hedge funds, however, are investing
in cryptocurrencies, and Goldman Sachs is reportedly
exploring how it can help clients trade digital tokens.
Other companies are stepping up efforts
to bring cryptocurrency to the mainstream,
opening regulated exchanges, creating futures contracts
and attempting to list exchange traded funds.
The recent surge in cryptocurrency prices
has coincided with a flood of interest
about the blockchain technology behind Bitcoin,
which uses a decentralized and public ledger
of transactions that can't be manipulated.
IBM, Microsoft and Toyota have all invested in blockchain
and are looking at potential applications
ranging from food safety to driverless cars.
So what is preventing even more widespread adoption?
Regulation, or the lack thereof.
In July 2017, the SEC announced that federal securities law
may apply to some cryptocurrencies,
without providing concrete guidelines
to determine which ones.
Meanwhile, China has outright banned ICOs,
or Initial Coin Offerings, along with the exchanges
where coins are traded.
Guidelines for individuals that mine and trade
cryptocurrencies also vary wildly,
with countries like Venezuela going as far
as putting miners in jail.
So what's next in the year ahead?
The cryptocurrency community is eager for clarity
from regulators on ICOs, trading, mining and taxes.
As that happens, more investors and end users
could dip their toes in the water.
Many have compared the current state of blockchain
to the early days of the internet,
a digital wild west teeming with opportunity
and just like the internet,
there will likely be winners and losers.