In an appearance at SXSW yesterday, Google’s Director of Ideas claimed that cryptocurrencies like Bitcoin aren’t going anywhere soon. “I think it’s very obvious to all of us that cryptocurrencies are inevitable,” said Cohen in conversation with Google Chairman Eric Schmidt. “There’s lots of value to it, [but] there’s a danger to it not being regulated.”

But while the future of Bitcoin seems to be assured, Cohen warned that it’s unclear how the technology will develop in future, as it’s still “a pretty new space”, reports TechCrunch.

For the initiated, Google Ideas is the internet giant’s very own think tank that spends most of its time dealing with oppressive governments, exploring how “technology can enable people to confront threats in the face of conflict, instability or repression”. It has nothing to do with any product development, so Cohen’s statement shouldn’t be taken as a sign that Google is set to start accepting cryptocurrencies itself any time soon. Even so, Google Ideas is still a part of Google’s Business Operations and Strategy group, and Cohen was personally tapped up by Eric Schmidt to lead the think tank back in 2010, and so his statements do carry some weight.

Bitcoin’s reputation has taken a bit of a battering in recent weeks, what with the debacle surrounding MtGox and other stories of theft and money laundering constantly hitting the headlines. But if some of the biggest brains at Google think that cryptocurrencies are “inevitable”, it’s a pretty resounding endorsement for the concept.

That doesn’t mean that Bitcoin itself will stay with us though. In his talk with Schmidt, Cohen asked “Is Bitcoin the model, or the master of cryptocurrencies?”

Bitcoin might be the first and most popular of cryptocurrencies, but that doesn’t necessarily make it the best. Anyone can take the Bitcoin model and adapt it to make their own digital currency – this week, Ars Technica made an entirely new one called “arscoin”, while others such as Litecoin and Dogecoin have already established themselves. The possibility exists that other cryptocurrencies, backed by financial institutions or corporations for example, could one day be created to rival Bitcoin itself.

The biggest danger to cryptocurrencies is keeping them stored safely and securely. The Bitcoin industry was shaken by the goings-on at MtGox, which claims hackers stole more than $400 million worth of BTC from it, and there have been dozens of other high profile thefts in recent months. Even so, Bitcoin continues to retain its value.

Cohen also had some ideas that Bitcoin fanatics might not be too pleased to hear – namely the need for dreaded regulation. “There’s a danger to it not being regulated in some form,” he insisted.

That might be so, but whether or not it’s possible to do so remains to be seen. Bitcoin regulation is a debate that’s been going on for years, and it’s unlikely to be settled soon because we’ve yet to see any realistic proposals of how it might be done.

Main image via Wikipedia.