Bitcoin is worthless
The only thing that underpins bitcoin is is hype
Bitcoin fails as a medium of exchange, in part because its value fluctuates widely, in part because you would be lucky to find anywhere that accepts bitcoin.
It fails as a store of value as its value is not stable.
It fails in other ways too, slow to process a transaction, cf a credit card transaction.
The energy involved is mind-boggling.
The computing power required.
We are seeing exactly the same bubble as we saw with dot com bubble.
I recall being invited to a breakfast meeting at one of these dot com companies, they were in fact a highly respected computer company that has since long vanished without trace.
It seemed to me perverse to hold a meeting at breakfast, when I would rather have been in bed, or at least at home eating breakfast. I did at least get a good breakfast.
Anything that was a building, bricks and mortar, was old hat, worthless, on the other hand if you were an internet company, the sky was the limit.
And companies that were bricks and mortar, were putting dot com at the end of their name, and low and behold overnight that were valued esteemed companies, when the night before old fashioned dodos from another era, doomed to failure.
And now we are seeing the same with crypto-currencies, use the block chain and you must be a valued company.
We have so-called fin-tech comanies. Make yourself a smart phone app with a stupid name and infantile graphics and overnight spoken in the same breath as a long established bank with real customer base, servicing small businesses on the High Street.
We have though been here before. The Dutch Tulip Bubble. Tulips do at least have some residual value, whereas bitcoin has none.
What is bitcoin now valued at, the equivalent of J P Morgan stock valuation, US GDP, or is that tomorrow?
The value of bitcoin rises as with any Ponzi scam, so long as more mugs can be found to part with their money. When the last mug is found and we run out of mugs, it will collapse overnight.
The important difference between bitcoin and the dot com bubble, for the latter there was at least real world assets underpinning, albeit blown up in value. For bitcoin there is none. Its value relies on finding another fool to part with their money, classic Ponzi scam.
Why and how the Cryptobubble will burst
While during the .com bubble at least people were receiving actual equity for their hard-earned cash, when they invest in most ICOs (the ones of the security token type above) they receive no rights in return. Let me stress this: they receive NADA, ZILCH, NOTHING of any value. They are invested in hot air. This is especially true for those ICOs that offer a product or service that does not really need a token. Let that sink in for a minute: because someone said “blockchain” you have bought hot air off a person that you do not know in the hope that someone else will buy it from you for a higher price. The only thing that helps you is the “greater fool theory” (if you do not know what that is, it is probably you).
We saw exactly the same with dodgy financial instruments, too complex to understand, underpinned by the Emperor Has No Clothes theory of risk-less risk. The two recipients of the Nobel Prize on the day the prize was awarded, the next day Lehman Brothers collapsed.
There is too much hot and dirty money floating around the world chasing silly projects in the hope of a fast return, and that includes Uber and Deliveroo.
FairCoin has better prospects, it has so far escaped Vulture Capitalists and Speculators, does not consume vast amounts of energy or require vast computing power, and is being used in the real world, for example in autonomous markets in Greece.
I could create my own bubbles. Invest in hot air. Each time the investment doubles, I pump more hot air into a balloon. Scam works, we can see the balloon increasing in size. Until one fateful day the balloon bursts and all we are left with are the shreds lying on the ground.
According to Mike Hearn, who claims to be one of the founding developers, the answer is yes.medium.com
The headline says it all: A Bitcoin Believer’s Crisis of Faith.medium.com
Bitcoin was an interesting proof of concept, but little more. It is useless as a currency.medium.com
For most people money is something that just exists. In order to receive money, someone needs to be willing to spend…medium.com
When Greece was being screwed by the ECB I suggested creating a parallel crypto-currency, an alternative currency for…keithpp.wordpress.com