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Great news if you're still hoarding Bitcoin. You can now use them in Las Vegas to win … more Bitcoin!
The D Las Vegas Casino Hotel and Golden Gate Hotel & Casino, both recently upgraded and under the same ownership, will allow virtual currency starting Wednesday morning at five on-property locations, including the two front desks, a gift shop and two restaurants.
The hotels will process Bitcoin purchases through BitPay, a service that handled more than $100 million worth of transactions in 2013 and allows merchants to accept Bitcoins in the same way as they would Visa, MasterCard or Paypal. Each cashier [sic] at the hotels will have tablets programmed with BitPay, and each customer will pay for services using their mobile wallets.
…While you can purchase rooms, food and drinks with Bitcoins at The D and the Golden Gate, U.S. dollars remain the only currency accepted on the casino floor. In fact, state regulators made it clear Tuesday that Vegas visitors aren't likely to exchange chips for Bitcoins any time in the foreseeable future.
"Bitcoins are not allowed for gaming usage in Nevada casinos," A.G. Burnett, Chairman of the Nevada State Gaming Control Board, explained in an email. "There is no push to allow Bitcoins for such gaming activities, and the Board has no plans to allow them."
OK, you can't actually gamble with them yet, but you can buy stuff with them. And since you're in Vegas, you could resell them for actual dollars, and then put them all on "red" or The Broncos or something.
I think the biggest surprise on Bitcoin is that it's still sort of at this nether-stage. It got on everyone's radar a few months ago as it exploded in price and Winklevii Love. I would have thought one of two outcomes by this point -- either it went up exponentially more to something like $4,000-$5,000, or would have crashed out like most frothy items.
I joked that I wanted to create BitCoin options and a Bitcoin VIX, but I'm glad none existed, as I would have thought triple-digit volatility was a buy in something like this. (Charts courtesy of Bitcoin Charts, click to enlarge.)
Yes, it recently halved to $500, then redoubled again, so volatility would not have become a complete disaster. But by and large, it's hovered in this same range for the last couple of months.
And remember when the 10-day graphs looked like a decade's worth of Google Inc (NASDAQ:GOOG) trading? That's tamped down as well.
And here's what else has tamped down recently: volume.
It's really a surprising picture, in my honest opinion. Bitcoin is the very definition of disruptive, yet it has very much stabilized. I doubt that lasts forever. Jamie Dimon says, "They will eventually be made as a payment system to follow the same standards as the other payment systems and that will be probably be the end of them." That's presumably speaking his "book," but it's certainly a possible outcome. Bitcoin crashing and disappearing or just being one of many cryptocurrencies is another possible outcome. Becoming the world's primary source of wealth doesn't seem terribly likely, but seeing Bitcoin squeeze higher again first wouldn't shock anyone.
Bottom line is, this story has stopped moving at Internet-speed. I'd be surprised if BitCoin is still $800-$1,000 a few months from now, but I'm surprised it's here now, so who knows? All I know is, I'm not opening an account and trading it just yet (or ever, most likely).
Disclaimer: Mr. Warner's opinions expressed above do not necessarily represent the views of Schaeffer's Investment Research.