I am a Bitcoin fan. And probably one of the many fans who, while keenly advocating its use, do not actually own a single Bitcoin. Risk averse realists do have dreams too, you know...
Having said all that, though, I do have high hopes on digital currencies. Here's why:
I've had enough of crooked bankers and financial companies manipulating currencies and markets. The recent scandals and investigations show that all these shenanigans have been going on for many years already. It's time for a common, open currency to fight Wall Street (and Canary Wharf, and Shenton Way and so on) manipulation.
2. No more profiteering from forex.
While a lot has to be said about punters trying their luck with trading the Bitcoin, the rest of the world is also doing the same in the stock, commodities and forex markets. A whole industry just makes money by taking advantage of the differences in currencies, a wholly man made concept - essentially making money out of nothing. A common, universal currency will make things right.
3. The ease of use
A digital currency does not need a printing press. It does not bother itself with counting the number of notes in circulation. Of course, transactions need computers and internet connectivity, infrastructure that is cheap and commonplace. Transactions can be effected by a password, a fingerprint or a PIN. And fraud? Well, digital currencies will have to be built on foolproof cryptography algorithms, right? (the Mt Gox incident just serves as a painful reminder on this point)
4. Limited quantity
The Federal Reserve certainly has drawn some flak for its quantities easing policies. Bitcoins are finite, believe it or not! While it exists in the digital realm, the wizards who breathed life into it made sure the miners who generated Bitcoins would reach a limit eventually. Think of it less as a fiat currency, and more like gold. We have limited gold, and it is still an effective currency for the longest time. On the flip side, central bankers printing money with no end in sight... is certainly worrying.
There's quite a few more advantages, and lots of opportunities for the modern entrepreneur to hop on and make the world a better place to trade. Coming up next... Payrolls in Bitcoins? It might be closer than you think...