Bitcoin’s Rise To A Major Currency

Until around 2012, the benefits of bitcoin were largely theoretical. You could pay anyone in the world almost instantly and almost free. The recipient, however, would have limited uses for the bitcoin he received apart from holding it speculatively or converting it to local currency.

In this article, we’ll begin with unique uses of bitcoin that drive adoption, and the incentive merchants face to accept the currency. Then I’ll discuss the feedback loop between utility and demand, leading to the investment case for bitcoin.

Unique Uses of Bitcoin

The bitcoin ecosystem has grown rapidly in recent years. The currency now enables many unique uses, including:

  • Purchasing gift cards to hundreds of retailers – such as Target (NYSE:TGT) and Home Depot (NYSE:HD) – at a 3% discount with no counterparty risk.
  • Anonymously purchasing pornography, gambling online, and buying goods and services that do not require shipping, without having to supply any personal information.
  • Buying gold online without having to initiate a bank wire or pay a 3% credit card fee.
  • Receiving an instant 5% Amazon (NASDAQ:AMZN) discount through Purse, and a 9% Starbucks (NASDAQ:Read more ... source: TheBitcoinNews