Should Doctors Invest in Bitcoin?

Dennis G. Murray, MA

Disclosures

January 23, 2018

In This Article

Bitcoin Is Gaining More Respect

Some online brokerages, including TD Ameritrade and E*Trade, are putting a toe in the water by allowing certain customers to trade bitcoin futures, but with a number of restrictions. Still, that's a sign that bitcoin and other cryptocurrencies may be going mainstream. Likewise, there's even a free bitcoin app called Bitcoin Tradr that runs on a Microsoft Windows platform and allows users to buy and sell bitcoin.

Another sign that bitcoin is gaining more respect: Some large companies, including Overstock.com and DISH Network, are allowing customers to use bitcoin to pay for goods and services. (Although the US government permits transactions in bitcoin, it's not considered "legal tender.") There's talk, too, that many smaller merchants may start accepting bitcoin, mostly so they can avoid paying credit card transaction fees.

Before we discuss whether bitcoin is worth investing in, it's important not to confuse it with its underlying technology, known as blockchain—a global, publically accessible, digital ledger of economic transactions that's transparent and continually updated. One writer calls it a "living, breathing chronicle of all peer-to-peer transactions."[4]

Although bitcoin is purchased through an exchange like Coinbase or Kraken, blockchain technology facilitates and records all transactions, after which the buyer receives a code, or "digital key," to his or her bitcoin.

Blockchain Will Affect Most Businesses

Blockchain is expected to benefit multinational industries that do a large amount of manual data processing, or that currently rely on offline or outdated modes of working. For companies that import a lot of goods, for example, the digital ledger would contain everything from the signed contract to shipping receipts to documentation for customs and insurance.

According to international accounting firm Ernst & Young, "Advanced financial applications are in development now, and global systems that could revolutionize traditional finance operations will be implemented in the coming year."[5] The firm says it's a matter of when—not if—blockchain will affect most businesses.

And as the Association of Chartered Certified Accountants, with nearly 200,000 members worldwide, stated in April 2017, blockchain "presents new areas for analysis and consideration, and the sooner professional accountants increase their awareness, the better prepared they will be to engage with it."[6]

For corporate accountants, digital ledgers would help them compile, check, and reconcile their transaction data, while lessening their risk for errors.

Comments

3090D553-9492-4563-8681-AD288FA52ACE
Comments on Medscape are moderated and should be professional in tone and on topic. You must declare any conflicts of interest related to your comments and responses. Please see our Commenting Guide for further information. We reserve the right to remove posts at our sole discretion.
Post as:

processing....