Cryptocurrencies: A curse or a blessing?

Speculative asset bubbles have been reported since Roman times. They doubtless go even further back, because they stem from an intrinsic flaw in human nature: we like to think that we are onto a winner - and when we are, we do not like to consider that things could go wrong.

Investors' current infatuation with digital currencies looks like a bubble to us. The best-known is Bitcoin, although there are now more than 1,000 in circulation, including Ethereum, Ripple and Dash.  Launched in 2009, Bitcoin has risen by more than 600% this year and more than 4,000% in the past five years. The rate of the increase has accelerated sharply in recent months - a classic bubble warning. Bitcoin is decentralised - the blockchain technology behind it means that no one owns it - and it is free of government control. It also provides a degree of anonymity. But its main attr...