Summary Bitcoin is worthless. Separate Bitcoin from blockchain technology. Bitcoin is not digital gold. Bitcoin can never be a currency under its current model. Achieving legitimacy would defeat the very purpose of bitcoin. Fidelity is introducing Bitcoin (COIN,OTCQX:GBTC) to its platform and CBOE is creating Bitcoin derivatives. These actions seem to imply that Bitcoin has real fundamental value, yet I remain unconvinced. While it is undeniable that the Bitcoin itself has market value, I believe that its high price is nothing but the product of misunderstanding and mania Proponents of Bitcoin have the following three arguments: 1) Bitcoin’s usage of blockchain technology will revolutionize how the world operates, 2) there is a limited quantity available, much like gold (GLD), and 3) there is a need for a decentralized currency. Combine the above, and Bitcoin is portrayed as a revolutionary technology that serves a real need and a gold-like asset that protects you from the devaluation of fiat currency (i.e. also known as inflation in non-fear mongering terms). While the arguments contain some level of truth individually, together they fail to demonstrate the fundamental value of Bitcoin. Let’s examine each argument closely. Bitcoin vs. Blockchain Technology It is true that Bitcoin popularized blockchain technology, which has the potential to remove the trusted middleman and remove the double-spending problem. Essentially this means that we no longer need to use a trust middleman such as a bank to ensure that each parties do have the assets that they claim to have (e.g. not double spending). Blockchain techhnology makes this happen by storing data in a single public ledger that is constantly verified as "true" by all participants in the network. There is no denying that such technology has the potentially to radically increase productivity, as there is no more need to dedicate time and resource to verify transactions. All of the data will be stored on one public ledger that is maintained by a decentralized network, making it secure. Blockchain technology can be very useful, but Bitcoin is a completely separate entity from the technology itself. Bitcoin is merely one iteration of the infinite versions of “currency” that one could create using blockchain technology. There is no greater evidence of this when you go on coinmarketcap.com and see that there are literally hundreds of “altcoins” that also use blockchain technology. While the cryptocurrencies differ from each other in some fashion, the underlying infrastructure is the same. It’s important to differentiate blockchain technology and bitcoin because many Bitcoin investors falsely believe that they are buying the blockchain technology, when in reality, Bitcoin is just the byproduct of the technology itself. The fact that blockchain technology may revolutionize the world (yet to come) has absolutely zero influence on the value of Bitcoin. Using blockchain technology to justify the value of bitcoin is akin to saying that the essay you wrote in your freshman year has tremendous value because it contains the English language. Fool’s Gold Because there is a finite supply of Bitcoin and new Bitcoins are getting harder and harder to mine as by design, it’s easy to call Bitcoin “digital gold.” Gold has had value since the dawn of mankind and it’s been used as a form of currency up until the last century. As gold today is no longer pegged to the dollar, its fundamental value should be questioned as well, as I detailed in this article. However, gold has proven itself to be a useful commodity because it is truly unique. It is also viewed as a safe haven assets because in times of chaos, gold will maintain its purchasing power while fiat currencies could become worthless. To be more specific, any real asset will serve the same purpose, but gold is the universal standard given its liquidity. Bitcoin cannot be equated to gold because as I stated in the previous section, Bitcoin and Bitcoin alternatives can be easily created with blockchain technology. https://seekingalpha.com/article/4097396-bitcoin-worthless-definitive-guide?page=2 Respect! Someone with a SOUND MIND about the "worth" of BitCoin.... Oh, all BitCoin heroes still valuing their BitCoins in fiat money terms? (double sarc/)
I agree with the premise of this author. Unfortunately I felt the same way when bitcoin was at $1.00 and I was trying to decide whether or not I should buy 5000 of them. I still think I will be able to buy those bitcoin for $1.00 one day. At some point a next level coin is going to come along that will replace all the current coins. It will have a secure network without burning ungodly amounts of electricity, it will handle massive #s of transactions per second, and it will not gain and lose 50% of its value on a regular basis, which will allow it to function as a store of value.
Here is my bitcoin TA, it is clear from the chart that the bitcoin speculators like big round numbers(Not much else to go off, is there). So bitcoin is due to either rocket straight to 5k or it will play with 4k before plummeting to 3k overnight.
Apparently all the learned English scholars say the convention used should be "bitcoin", all lower-case. Isn't that what the logo looks like anyway?
I remember a discussion in 2013 when the community wanted to distinguish the difference between bitcoin the Currency, and bitcoin the Protocol (which later became the Blockchain). The first was written lower-case, the second with a capital. Both are OK to me, but certainly not "BitCoin". Funny thing is that when you see some bad journalism in some newspaper, they use "BitCoin" a lot.
What if the Federal Reserve, which is constantly wanting to wave the banner that it is independent from the US Government, began to utilize block chain technology and you could trade USD directly with one another without a bank intermediary. I know next to nothing on the block chain technology so this is where everyone else whom educated on the technology can chime in. Could USD use blockchain technology and replace alt coins at some point?
Yeah it's worthless, Fidelity allows clients to see digital currencies on its website. Where do ya think the price of the coin will be when they allow actual trading? CBOE will launch futures contacts on the currency in the fall(?). Places like Overstock, which accept Bitcoin, will hold some of it as an investment; thereby taking more supply offline. The big money is still getting into the game. Edit: Don't forget, India is still debating as to whether to legalize the currency. It is quite telling that although it's illegal to use, Indians have been converting rupee to Bitcoin for some time now.