Is $10k the beginning of the end for Bitcoin?

Is $10k the beginning of the end for Bitcoin?

Not only did last week see Bitcoin break yet another record, it did so in spectacular form by reaching, and surpassing, five-figure status. After crypto enthusiasts did their $10k happy dance, Bitcoin did them one better by reaching and exceeding $11k.

However, with optimists come cynics. For each dollar gained, naysayers were ready and waiting with the "bubble" comments. The amazing fact that the currency has grown by over 900% actually seems to hammer home the bubble theory to these critics.

Even through all the negative comments, being called "a fraud" by JPMorgan CEO Jamie Dimon and all the usual doom and gloom, Bitcoin has persevered, and if it's astronomical growth is anything to go by, it will continue to do so.

Academic and CEO of Distilled Analytics, David Shrier, told CNBC that ongoing speculation about cryptocurrencies isn't necessarily a bad thing.

"There is enough utility and utilization of Bitcoin that it will retain some kind of value, even if the price settles down a bit. Amazon didn't go to $0 when the dotcom bubble burst, but other frothy stocks with no reality behind them did. Similarly, Bitcoin won't go to zero, but I do believe a number of these other cryptocurrencies will fail," Shrier said.

Chief scientist at the DFINITY Project research group, Dominic Williams, has however voiced his concerns about ICOs saying that "only a fraction of the projects holding ICOs have any chance of success."

"The vast majority have been created specifically with the ambition of collecting money from enthusiastic investors rather than delivering utility in the real world," Williams said.

Another concern, this time voiced by founder and CEO of Citadel, Ken Griffin, is that contributors and investors are confusing Bitcoin with blockchain, with the latter being the technology used to make cryptocurrencies possible. He went on to tell CNBC that many buyers do not understand blockchain.

Some experts in the financial industry are still bracing themselves for the bursting of the Bitcoin bubble. However, Shrier has stated that this "speculation helps attract new sources of risk capital and new entrepreneurs to the space." Because of this, he is not too concerned that a possible crash in Bitcoin's price will deter the banking industry's adoption of blockchain technology.

"Other market forces will assert themselves eventually, and what will emerge out of that is a new way of operating," he told CNBC.

Williams's also had something to say about Bitcoin being used as a regular medium of exchange. "The value of Bitcoin is notoriously volatile because it is created mainly by the interaction of speculative demand, which makes application as a normal currency impossible for now," he said.

In addition, Williams touched on the possibility that only early investors in Bitcoin will benefit financially, while late adopters could stand to lose a lot of money.

Even though exceeding expectations, the rise of Bitcoin may not be over just yet. Fund manager, Michael Novogratz, who actually predicted the cryptocurrency reaching $10k, says that it could reach $40k by the end of 2018. Novogratz has a vested interest in the industry as he has over 20% of his net worth invested in cryptocurrencies.

As Bitcoin continues to increase in both price and popularity, the "bubble" chants seem to grow louder and louder. However, this seemingly super virtual currency continues to prove cynics wrong in its quest for global adoption.

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