I have watched Cryptocurrency rise in popularity over the last decade. In the course of this essay I will discuss what I think it means to invest in cryptocurrency.
Bitcoin was apparently invented in 2008 by Satoshi Nakamoto. The fact that Satoshi has never been identified is very odd. The question arises as to why the creator would want to remain secret? I would postulate that the reason the creator is a secret is because the truth would reduce trust in the new digital currency. Digital money is sold to the masses as a way to prevent money printing and inflation. A lesser acknowledged problem it would solve is it would remove cash transactions from the economy. This would be a wonderful way for governments to increase tax revenue and reduce illegal money transfers. Therefore I would wager that the creator of Bitcoin is somehow aligned with a governmental institution.
A digital currency would be a marvelous thing for government. No money can exist outside of the tax system. The government has less to worry about undocumented cash transactions, just visit Argentina to see why this could be important. In my opinion Bitcoin is a beta model, created to test the concept of a digital currency. There may soon be new digital currencies that are regulated by central banks.
Money is currently transacted digitally but the current digital currency is reliant on trusted organizations, such as banks, to confirm the authenticity of the funds being transferred. Bitcoin removes banks from the loop. This is another reason that Satoshi is needed. Whoever created Bitcoin is going to reduce the need for the existing Banks. The true creators needed an imaginary fall guy to take the backlash from the Banks.
A digital currency will remove the need for a financial intermediary, it will reduce tax evasion and it has a good chance of reducing criminality. It is also clear who created it, a government aligned research institute, probably in the USA.