Bitcoin mania is now everywhere. It’s hard to have a conversation with regular people without sooner or later getting into bitcoin. Some of this is just for fun. Manias breed amazement. Miracles are wonderful to behold. But some of it is pretty serious.
“We’ve seen mortgages being taken out to buy bitcoin,” said Joseph Borg, president of the North American Securities Administrators Association and director of the Alabama Securities Commission, on CNBC’s Power Lunch today. “People do credit cards, equity lines,” he said.
Bitcoin futures trading started Sunday night on the Cboe futures exchange. Next week, the CME will offer trading in bitcoin futures. This way, speculators can bet with unlimited derivatives on an unregulated digital entity that is backed by nothing and whose cash trading takes place in unregulated opaque and easily hacked exchanges around the world.
But Borg doesn’t think that futures contracts legitimize bitcoin. Innovation and technology always outrun regulation, he said.
“You’re on this mania curve. At some point in time there’s got to be a leveling off,” he said. “Cryptocurrency trading is here to stay. Blockchain is here to stay. Whether it is bitcoin or not, I don’t know.”
And so the media mania over bitcoin has become deafening. But there were also some bitcoin-free zones.