I don't agree. There's a lot of potential value in a widely accepted digital currency:
1. Minimal processing costs for business (no banks)
2. Global currency without cross-border exchange costs
* Closer to cash in terms of trackability than current options (crime-friendly currencies have always done well!)
The current bubble is obviously just that, but there's no reason it can't normalise and become commonplace.
Here is my view based as an ex-miner:
1. Processing costs are there in terms of time, it's not as frictionless as people make out. I.e. validation can take sometime and because the payment is irreversible someone can walk out of the door with the goods. It's unlikely but the possibility is there. Also there is cost with performing any transaction (paid to miners).
That's just a drop in the ocean compared to the 'currency risk' opened up by retailers accepting bitcoin due to the wild swings in value. Worth £1000 this morning, now worth £500. Not a good proposition for a free flowing currency.
Getting money in and out of BC is still a very very large problem - look at the huge spreads on the exchanges and in fact where those exchanges are located. They operate beyond the scope of legal jurisdiction - do business at your own risk with no come back. Additionally look at the spread on the exchange - you'll lose a lot, if you just pushed your $ into BC and back into $. Also you'll need to do various currency transfer £ to $ to BC. So it's a crazy user experience.
2. Brokers such as Transferwise exist to allow pretty low cost currency conversions between a spectrum of currency pairs and very low cost - and its always in cash. You don't have to convert your hard earned £ into BTC and then back again. Granted if we got paid in BTC, spent it all in BTC it might have a chance but with such a deflationary currency its going to be hard to spread it around to become the global platform.
3. It is close to cash. But just remember right now, there is no promise legally backed up anywhere to accept it - so you accept the freewill of retailers to accept it. Cash is legal tender which means it has to be accepted - by LAW.
I don't use cash - I have a contactless credit card which is working pretty well. I hardly use cash these days at all. My money transfers use Transferwise and I pay a tiny fraction < 1% for swapping between currencies. So I really have no need for it.
I think eventually we will have a "Global Currency" but I don't think it'll be BitCoin, Litecoin or any of the other Alt-coins.
