Aswath Damodaran has written a concise and informative post on the rise, mechanics and future (as he sees it) of cryptocurrencies. It’s worth reading. He sees digital currencies competing with fiat currencies sooner rather than later, but is “hard pressed to find a winner on the current list.” He thinks that could change if the designers of cryptocurrencies “start thinking less about it as a speculative asset and more as a transaction medium, and [acted] accordingly.”

Damodaran is the latest member of the finance community to add his voice to the debate over the future of cryptocurrencies. Howard Marks also weighed in on the subject in his latest investor memo (see the full letter here). He was less positive in his assessment, however, calling digital currencies “nothing but an unfounded fad (or perhaps even a pyramid scheme), based on a willingness to ascribe value to something that has little or none beyond what people will pay for it.”