Bitcoin should be dead now following the hacking of the Mt. Gox exchange, Nicolas Colas, a managing director and chief market strategist at ConvergEx Group, told an audience at a presentation about the virtual currency hosted by the New York Society of Security Analysts on Wednesday. Instead of dying, the currency has bounced back, with its price increasing by more than $100 since it fell steeply after the collapse of Mt. Gox.
Although wide public acceptance has been elusive for Bitcoin, there is still enough demand for Bitcoin that not even the failure of Mt. Gox could dissuade that demand, Colas said.
[For more on the Bitcoin debate, read: After the Mt. Gox Collapse, Wall Street is Wary of Bitcoin]
âI thought we got to the point where Bitcoin was done after Mt. Gox, but its recovery since shows how durable it is. Itâs a strong signal of the demand to own and transact in Bitcoins. [The demand] is global, so it doesnât depend on the U.S. news cycle,â he explained. âAt the end of the day, you have to respect that [high] price.â
Bitcoin has several strengths related to its anonymity and ease-of-transfer that have fed its global demand and kept it strong. That strong demand -- and the fact that Bitcoinâs systems involved in creating the currency are extremely secure -- means that Bitcoin is here to stay, Colas noted in his presentation. And the currency could really take off in the future if regulators figure out how to treat the currency and a more secure way of trading the currency is found, he added.
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Bitcoinâs usefulness for international payments is one of the sources of its allure, according to Colas. He called Bitcoin âthe best way that has been found so far to send international payments.â