Their use to create “cryptocurrencies” or “virtual currencies” (VCs) – to denote their lack of legal recognition – is often touted as something that could fundamentally change the financial sector. The spectacular rise in the market valuation of VCs over the past year suggests that many people shared this belief.
In the course of 2017 the global VC pool both deepened, from USD 30 billion to USD 400 billion, and widened, with the proliferation of “initial coin offerings” or “ICOs” – virtual fundraising facilities for start-up investors.1 But in my view, the subsequent market plunge rather points to a fading fad.