Bitcoin as a relatively new concept, or technology is still figuring out exactly where it is going and what it wants to be.

Does bitcoin want to be a global currency, to replace all fiat (eg £, $, €) currencies? Does it want to be the world's processing system, a means of international payment to replace SWIFT and/or Western Union? Does it want to be a unit of verification to allow assets, deeds and patents to be recorded onto a permanent ledger (the blockchain)? Or does it wish to be an asset, a 'digital gold' used to store value?

The simple answer to this is no-one knows and everyone seems to disagree!

The bitcoin community has been in a state of civil war for many months now with investors, developers, exchanges and miners all giving their opinion on which BIPs (Bitcoin Improvement Proposals) to scale bitcoin are best and contributors to reddit/ github etc all suggesting 'tweaks' to all of them to complicate things further.

There are undoubtedly vested interests at work- exchanges want quick and cheap transactions, miners want to protect their investment in expensive hardware and to see increasing transaction fees, developers all have their own unique interests at heart, depending on what type of project they are working on and investors just want to see the bitcoin price rising!

Whatever the outcome is and in spite of all this chaos, bitcoin's recovery over the second half of 2015 suggests it is likely to be around for many years to come. Presuming these disagreements can be settled and whatever the solution, bitcoin is likely to grow as an global currency, processing system, unit of verification and as an asset.

Why? Well the number of bitcoin transactions has continued to grow to new highs throughout 2015, as has the hashing power (the combined processing power of all those 'mining' new bitcoins and securing the bitcoin network), leading many commentators to point to the fact this network now equates to many times the power of the world's largest supercomputers.

The number of bitcoin wallets, users, merchants accepting bitcoin and start-ups also continues to increase and the price has recovered from losing 50% of its value since the start of 2015 to probably 'break-even' this year.

However, for all the amazing potential technological implications of 'blockchain technology', what gains the 'average persons' interest is not the technology, nor the ability to pay for things efficiently. Yes people seem vaguely interested in sending money worldwide in minutes, but we have to face it, how often do any of us want to pay someone in Western Samoa, or Uganda?

What gains people's attention is simply saying, 'you do understand there can only be 21 million bitcoins?' (and for every 10 people you meet who say they have heard of or 'understand' bitcoin, 7 of them will not know this and 9 will not understand the potential implications...)

Bitcoin is 'finite', there can only be 21 million bitcoins.

What this means is less than 0.3% of the world can ever own a bitcoin and there are already far more millionaires (in any currency) than there are people who own (or control, seeing as it is technically impossible to 'own' a bitcoin) 1 bitcoin.

This is what gets attention and explains why bitcoin is a potential asset, or store of value, or 'digital gold'. Insidebitcoins recently ran an article, comparing buying a bitcoin to playing the lottery, with better odds and more potential ways of winning (http://insidebitcoins.com/news/stacking-the-odds-winning-the-lottery-jackpot-or-investing-in-bitcoin). I completely agree with the idea behind the article and have always agreed with the opinion 'bitcoin will be worth a fortune...or nothing'.

A picture of a bitcoin mining facility that appeared in the economist

To date, approximately 15 million bitcoins have already been mined and supply of new bitcoins is deflationary, ie it is slowly decreasing, with the next block halvening likely to happen in mid-2016 to take the reward for mining each block of bitcoin transactions from 25 bitcoins to 12.5 bitcoins.

So what does this mean? When founding TGBEX Limited, a company built to raise awareness of bitcoin and help spread ownership of bitcoin, I considered bitcoin to be many things (some of which are outlined above). I spent many months studying the early history of bitcoin and thinking about the potential implications and outcomes of bitcoin as a technology, payment system and asset. The bit (excuse the pun) that fascinated me is the potential of bitcoin as an asset.

The fact that supply decreases and eventually drys up means bitcoin could become the most valuable commodity in the world (like gold the value could be determined by how much is used in manufacturing, or to pay for goods/ services, combined with the appetite of investors looking to safeguard/ store value). It is designed to increase in value and as long as it is used, or desired, there is no reason why the value cannot grow indefinitely.

In mid 2014, I came to the conclusion that the bitcoin price could do anything for the next 18 months (to where we are today) and correctly predicted the price would be 10-20% lower by the end of 2014. I also suggested to many involved in the industry that the price could halve during 2015 (believe it fell almost 60% at the lows), but one thing was clear. For the 6-8 months from November 2015- July 2016 (or the date of the next halvening) bitcoin should rapidly increase in value.

IF bitcoin can work as a technology (global open-source database/ permanent ledger), OR as a payment system OR as a store of value OR purely as a speculative tool, then it will have some utility and therefore a value.

If it can work as all of these things (and there are many more potential uses) then the potential value is obviously increased and maybe it should be considered the 'Ultimate Asset' (given finite supply and multiple/ varied use cases).

The bitcoin price is largely driven by speculation and by the fundamental economic theory of supply and demand, both suggest that in the 6-8 months before a halvening event, the bitcoin price should rise (in 2012 in the run up to the last event the price rose by 150%).

IF the price does increase rapidly, then this is likely to bring a new wave of investors, users, enthusiasts and would also likely bring a new wave of merchants jumping on the bandwagon (if they'll accept American Express, despite the fees, no reason not to, given advantages, but wide acceptance will only come when a significant % of customer bases own bitcoins).

Nothing is guaranteed, bitcoin has risen sharply over the past 3 months already and is likely to be volatile. If the price declines over the next 6 months, then it seems unlikely bitcoin can ever fulfill its potential (barring a major economic collapse in the West, or bitcoin gaining traction in the emerging world (where it is needed most) which is likely to take at least a decade), as can see interest waning and competitors having a chance to emerge.

Yet if it does start to 'take-off', the bitcoin industry is far more developed than it was in 2011, 2013 or even 6 months ago. Many bad actors have been exposed and are being punished (eg those behind Mt Gox, Paycoin (finally!) and the USA's DEA). The industry is now being supervised, regulated and no longer is 'operating in the shadows'.

New users/ investors now have a plethora of exchanges, wallets, listed ETFs and other investment funds which make investing in bitcoin easier than investing in gold, or foreign equities.

Bitcoin is ready, if the world is....

(you can buy a lottery ticket at www.tgbex.com today!)