There’s no shortage of speculation when it comes to the price of bitcoin. Complex market forces combined with bitcoin’s limited liquidity create for an inherently unstable price. But, what about a different type of prediction? The prediction of Bitcoin itself years before it would come to fruition.
In 1999 American economist Milton Friedman did just that.
Bitcoin Prediction in 1999
A reliable “e cash”
[Video transcript starting at 3:18] Friedman “…I think the Internet is going to be one of the major forces for reducing the role of government. The one thing that’s missing, but that will soon be developed, is a reliable “e cash.” A method whereby, on the Internet, you can transfer funds from A to B without A knowing B or B knowing A. The way in which I can take a twenty dollar bill and hand it over to you and there’s no record of where it came from. And you may get that without knowing who I am. That kind of thing will develop on the Internet and that will make it even easier for people to use the Internet. And of course, it has it’s negative side. It means that the gangsters— the people who are engaged in illegal transactions—will also have a easier way to carry on their business. But, I think that the tendency to make it harder to collect taxes will be a very important positive effect of the Internet.”
Predicting cryptocurrency
In all fairness, Friedman wasn’t the only one to predict a digital currency during this pivotal time. What’s amazing is the accuracy of the description Friedman provides: A future where digital currency will be exchanged peer-to-peer, like physical dollar bills, and where the parties involved need not know each other. And, the transaction occurs without a record of it happening.
Friedman’s prediction might better describe Zcash or Monero. Regardless, the fact that he envisioned cryptocurrency of any kind over a decade before it became a reality is impressive.
