Bitcoin going nowhere

Given that inflation has been heating up, I find it curious that Bitcoin hasn’t been taking off. Wasn’t it touted as a hedge against inflation and the evils of “fiat currency”?

Then again, Bitcoin isn’t suitable as a currency. It’s one thing to criticize “fiat currency”. It’s another thing to replace it. Bitcoin is clearly falling short.

2 Likes

Given that inflation has been heating up, I find it curious that Bitcoin hasn’t been taking off. Wasn’t it touted as a hedge against inflation and the evils of “fiat currency”?

Bitcoin has lost about 20% of its value in the last six months. If you view Bitcoin as currency, it is experiencing hyperinflation.

5 Likes

Given that inflation has been heating up, I find it curious that Bitcoin hasn’t been taking off. Wasn’t it touted as a hedge against inflation and the evils of “fiat currency”?

Yeah, it seems to trade more correlated with the Nasdaq than with gold.

1 Like

If you view Bitcoin as currency

With due respect, this board is least qualified to understand or value something like Bitcoin. Frankly, the sages of this board don’t even have the humility to accept, I don’t get Bitcoin.

You don’t have to understand everything, things doesn’t have to make any sense from your prism. I like the “potato eaters” by Van Gogh, but can never understand why someone would like to pay 100’s of million dollars for that. Now, if you are an art fan, probably you get it, but for me Van Gogh mostly painted everyday stuff. What is so great? right? Now, instead of Van Goug, substitute NFT, Voila, you are me.

All you have to understand is, the market cap of Bitcoin is $900 B, bigger than Berkshire. So there are lot of people understand it, and we don’t.

2 Likes

So something that isn’t understood mandates value? Nah.

8 Likes

So something that isn’t understood mandates value?

Sure. As long as you don’t look behind the curtain.

3 Likes

So something that isn’t understood mandates value

When you understand, why you think you can value it? You just have to accept it is too hard and move on.

With due respect, this board is least qualified to understand or value something like Bitcoin.

I understand it.

All you have to understand is, the market cap of Bitcoin is $900 B, bigger than Berkshire.

Personally, I think you should learn a lot more than that before investing in it, but you do you.

14 Likes

I thought Bitcoin was supposed to be an alternative to the Dollar (fiat currency). The dollar is strengthening with ever increasing interest rates. So BitCoin floundering as the dollar strengthen makes perfect sense.

FWIW I think crypto is garbage. Actually worse than garbage because garbage at least exists. It IS something. Just saying proponents have a less compelling argument in a rising rate/stronger dollar world. O% rates/QE was THE ticket for crypto.

3 Likes

I think the fundamental question is whether any entity other than the government is allowed to issue currency or pseudo-currency like bitcoin. It’s not about whether bitcoin or the technology behind it has value. No currency by itself has any value, other than that granted by the government. Gold by itself also has little value, but it bas been ‘acknowledged’ since ancient time by governments to be exchangeable with currency.

1 Like

I think the fundamental question is whether any entity other than the government is allowed to issue currency or pseudo-currency like bitcoin.

Sure. One example is frequent flier miles. They can be exchanged or sold on the open market. Maybe a better example is cell phone minutes which are used like currency in some developing nations because they are easier and safer to use than cash.

Bitcoin is not a currency, it’s an non income producing speculative asset like art, precious metals, First Grwoth Bordeaux, trading cards etc. It’s worth what someone is willing to pay fort it, your return depends on future popularity. The main difference ist you can at least enjoy a painting or drink the wine if you were wrong. Shitcoin? Not so much, you can’t even fondle it :wink:

3 Likes

0 to $42,000 in 13 years is a pretty good hedge against inflation.

Rising prices are a SYMPTOM of the inflation. The inflation happened a long time ago.

2 Likes

I think crypto is garbage. Actually worse than garbage because garbage at least exists.

I think it’s garbage for a very different reason. The whole world talks about nothing else than global worming, emissions and energy consumption (until the Russian version of Trump came). And then this? Using as many CPU’s/GPU’s as possible at full throttle for nothing else than to mine cryptocurrencies? I can’t think of anything more pervers.

14 Likes

Bitcoin is not a currency, it’s an non income producing speculative asset like art, precious metals,

just to be clear, even currency doesn’t produce income. It produces income only when you “deposit” or lent it to an institution it produces income.

1 Like

Launched last December, its creator is Molly White,
a software engineer and Wikipedia contributor:

https://web3isgoinggreat.com

She combs through crypto sites and presents a
reverse timeline of the most prominent scams. A
“Grift Counter” in the bottom right corner adds up
the value of all the losses to theft and scams that
you’ve read about so far.

-Rubic

6 Likes

<<Bitcoin is not a currency, it’s an non income producing speculative asset like art, precious metals,

Bitcoin passes the “duck test” for gold, it looks and feels just like gold. It will eventually evolve to be stable digital gold if it’s allowed to be publicly traded and substituted as payment. The real risk is that someday the US government, like the Chinese government will ban it.

1 Like

With due respect, this board is least qualified to understand or value something like Bitcoin. Frankly, the sages of this board don’t even have the humility to accept, I don’t get Bitcoin.
…All you have to understand is, the market cap of Bitcoin is $900 B, bigger than Berkshire. So there are lot of people understand it, and we don’t.

“With all due respect,” I respect the opinions of “sages of this board” more than I do the drooling mobs who trade in Bitcoin. And I’m not at all impressed by whatever Bitcoin’s market value is. Heck, the last I heard the market value of Tesla was more than that of GM or Toyota, also based on market hysteria. At least GM and Toyota know how to make cars. Tesla knows how to make batteries; the rest of their functional parts aren’t so great.

Bill

24 Likes

the market cap of _____ is $_____ B, bigger than _____. So there are lot of people understand it, and we don’t.

It nice to be old, sometimes. It lets you spot Webvan reasoning when it comes back, as it does from time to time.
I’m not arguing that Bitcoin will have no value in future. Rather, that reasoning will have no value.
A high price is not evidence that something is worth a lot. The “big money” can be the dumb money, and often is.

Let’s imagine that the market price of Bitcoin goes up by a factor of 100 in the next decade, which it might well do.
How much wealth will thereby have been created? None.

You can replace the word “Bitcoin” with any other static asset and get the same result: gold, Rembrandts, diamonds, Beanie Babies.
Imagine I sell a paperclip to my next door neighbour for a trillion dollars.
If that transaction datum sets the notional total market cap of the world’s paper clip holdings into the quintillions, the world is no richer.
The subtler aspect of the analogy: how much purchasing power can be raised if (say) half of all holders of paperclips decide to sell them?

Jim

25 Likes

Serious question. Does Tesla not buy it’s batteries from Panasonic?