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Bitcoin, a speculative virtual currency yet not an alternative to fiat currency

Henri-Louis Vedie | June 21, 2021

Bitcoin raises a number of questions, as it doubled in price over the first three months of 2021, only to lose practically half is value in a matter of days in April 2021. This Policy Brief sheds some light on Bitcoin’s origins, starting in 2009, making it a child of the 2008 financial crisis. The brief also details Bitcoin's reliance on cryptography, blockchain and mining to safeguard the world's first digital currency. Bitcoin's price explosion in late 2020, peaking over $62,000 on April 13, 2021, only to drop back to $36,000 in less than a month, driven by a master speculator in Tesla, both consolidates and condemns it. It consolidates it as a new particularly speculative virtual currency, not necessarily the status its’s creators had in mind. It also condemns it never to become exactly that for which its authors imagined and created it, i.e. an alternative to fiat currency.