After a spectacular performance in 2013, bitcoin’s fortunes have nosedived this year. The virtual currency was the worst investment in the world during Q1, with more than 38% loss, far ahead of its closest competitor—Argentina Peso—which was down more than 18% against the US dollar.
Bitcoin world has seen many twists and turns this year; including claims regarding the “identification” of the founder, theft at a major exchange by hackers, exchange bankruptcy etc.
Further, IRS ruling regarding treatment of bitcoin as a property subject to capital gains tax has added to worries of investors interested in virtual currencies.
There have been some positive developments too..more and more establishments have started accepting the bitcoin. You can even buy space travel tickets using bitcoin.
Do you think that the bitcoin (or any other virtual currency) has the potential to ever become a global currency? Why do some investors trust a “currency” that is not backed by any government or central bank?