It is big news. Goldman Sachs is possibly joining the list of believers in the cryptocurrency called Bitcoin and others like it. This may be the moment the adherents of Bitcoin are waiting for. This also suggests that regulators may be reading the signs poorly.
Goldman Sachs Group Inc. is weighing a new trading operation dedicated to bitcoin and other digital currencies, the first blue-chip Wall Street firm preparing to deal directly in this burgeoning yet controversial market, according to people familiar with the matter.
Goldman’s effort is in its early stages and may not proceed, the people said. The firm’s interest, though, could boost bitcoin’s standing among investors and fuel the debate around digital currencies, which were initially viewed as havens for illicit activity…
The mere thought that the best of the breeds can have this type of conversations with its clients is an indication on the durability of cryptocurrency. I do believe that digital currency is here to stay. It will not disappear because there has never been a technology on earth which emerges, becomes a household name and then disappears without an impact. Sure, the impact could be bankruptcies and ravaging of lives, but I do not think so.
Even if Bitcoin should fail, it will lead to another flavor of digital currency. Before Facebook, we had MySpace. And before Apple, we had Nokia. So, evolving technologies do not necessarily disappear when they actually deliver value to some people in the society, at scale. All the competitors will joggle until we reach maturity phase. Then the utilities-like category kings will emerge. When that happens, the surviving one becomes part of the society. Facebook is now part of all aspects of our lives including the political spheres. There is no government that does not think of Facebook.
Oh yes, that transmutation and evolution before maturity is the risk on cryptocurrency: you do not know if it will be Bitcoin or one from Japan or China or Nigeria that will survive. That uncertainty is why this is severely risky. But when Goldman Sachs sees alpha, I know the world will follow. Just like that, they have beatified Bitcoin and its cousins in this Gregorian Year of 2017.
Coming Home – Nigeria
My position remains that we do not need Bitcoin but Nigeria needs a digital currency tied to the Naira that will enable the efficient functioning of the blockchain infrastructure which I expect to evolve in coming years in the nation. If the Central Bank blesses such a plan, we will experience a virtuoso innovation system in redesigning the architecture of some of our industrial sectors and make them more efficient even while being cost-efficient. As I noted in my entry on Blockchain Africa, blockchain has a promise for Africa. Nigeria just have to find a way to lead in that promise at least in West Africa where its impact is huge. As Goldman Sachs goes closer to Bitcoin and digital currency, we may be too slow that very soon, it becomes an entirely foreign imports to Nigeria.