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Bitcoin’s Wild Ride Shows the Truth: It Is Probably Worth Zero
- manbearpigg 9y agoWell if a guy on the internet says it, it has to be true.
- hndamien 9y agoI think we found the guy that regrets not buying any Bitcoin (the author - not manbearpigg)
- emodendroket 9y agoI mean I don't think anyone can deny that it turned out to be great to speculate on so far, but is it actually a good means of exchange or store of value? It remains extremely volatile.
- blunte 9y agoIn many situations it is an excellent means of exchange of value. Convert your fiat to bitcoin, make a global bitcoin transaction (for a comparatively small transaction fee, and within 30 minutes), then convert the bitcoin to fiat on the other end. That's WAY better than a bank wire, and even better than the increasingly effective service that Transferwise provides. It's also beneficial to at least one party because no bank can reverse the transaction.
- consz 9y agoWhat's the 30min volatility of BTCUSD vs. the cost of a bank wire?
- emodendroket 9y agoIt's relatively inefficient and it's hard to see why someone would choose that over wire transfer unless they were doing something illegal. I also don't get why "no banks can reverse the transaction" is touted as a benefit so often; what sane buyer prefers to do online purchases where they have no recourse if they never receive the goods?
- camus2 9y agonon obfuscated article archive because nobody can read the WSJ at first place : http://archive.is/uUnGp http://archive.is/uUnGp
- codewritinfool 9y agoNevermind the subject, this article is really poorly written.
- jameskegel 9y agoMost of these types of uninformed, regurgitated, bait-articles typically are, because that's what makes them so effective. They don't want you there admiring the technical or journalistic merits of the article, they want you to link it because it is so outrageous, "look how absurd this is, just click it and LOOK!"
- emodendroket 9y agoI don't really see what's absurd or outrageous about the claims in this piece.
- SolarNet 9y agoThe most interesting part of this article also counter his point: the possible theoretical values of bitcoin.
- panarky 9y agoAt least the author has a new argument I haven't seen before. 1) Gresham's law: bad money drives out good 2) Bitcoin is good money (deflationary, holds its value) 3) National currencies are bad money (inflationary) 4) People prefer to "hoard" good bitcoin and spend bad national currencies (So far, so good) 5) Therefore, since people prefer to own bitcoin, it has zero value (Not every new argument has to make sense, I guess.)
- colejohnson66 9y agoCouldn’t that same argument apply to the stock market? People prefer holding on to stocks, but every once in a while will cash out on their increase?
- sharemywin 9y agoespecially growth stocks that don't pay dividends.
- emodendroket 9y agoNobody is talking about replacing United States dollars with stocks, are they?
- SilasX 9y agoGresham's law is specifically about the case where people are required to treat the two moneys as equal when one has a higher real value; if they're just different goods with no parity requirement, the effect doesn't happen. (People casually refer to "bad money driving out good" whenever smart investors abandon bad markets, but that's a different dynamic from Gresham's Law proper.)
- alexasmyths 9y agoWhat you are referring to as 'good money' , most people would call 'stupid money'. It's a stupid idea to run a country with a fixed amount of currency - as the economy expands, more currency is needed - either that - or all prices of everything need to adjust because the 'stupid currency' is fixed. A 'well managed' currency is better than a fixed supply. Of course - the 'existential risk' is that some political cowboy will 'print money' for political reasons - this is the great problem that fiat always faces. But this can be avoided. Most major currencies are very well managed. Also - remember that they are backed by actual assets - so money is not coming out of nowhere. Almost all Euros are backed by some kind of quality asset. It's very rational to allow entities to 'trade' some kind of asset for currency at the central bank. This is actually more 'free market' than any kind of fixed currency. National currencies - irrespective of the quality of their governance, fixed or not - are extremely useful to everyone. They 'spend' that currency because it's what's used to buy stuff. Household expenditures: mortgage/rent, electricity, groceries, insurance, gas, car payments, cable/internet. Can you use BTC for any of that. Pragmatically - No. BTC is 'pragmatically worthless' to anyone - it has no reason to exist. BTC is very useful to money launderers, tax evaders, and other people doing illicit things, it's a great currency for the black market. But beyond that, it serves no purpose. It's not a currency and it's a terrible store of value as compared to any of real-estate, gold, most commodities, a 'basked of bonds of equities' or a 'basket of currencies'. It's a great intellectual exercise, and I think the 'paper value' of BTC will remain quite high for some time, but unless it sinks in as an actual currency of some economy (say, African nations where the currency is garbage), in the long-long-long run there's no reason for it to maintain it's value.
- dba7dba 9y agoTime to buy MORE BTC and LTC and other cryptocurrencies. Remember, when WSJ and analyst says to do something, do the opposite.
- xiphias 9y agoThe fact that the author knows about Bitcoin means that he will have it before other people. He understands that its value is either infinity or 0 counted in dollars... he just needs to change the direction
- sunstone 9y agoYup, just like gold.
- aussieguy123 9y agoHe said gold was better, because gold doesn't cost electricity to produce whereas bitcoin does. Thats not true, you need electricity (and other resources) to: - mine gold - build storage facilities to store gold - transport the gold
- blunte 9y agoNot to mention the very direct human and environmental costs of mining, particularly for the mines in Africa and China.
- afishisafish 9y agoWhat I'm missing from the article is that Bitcoin often is seen as the "reserve currency" of the cryptocurrency world. Bitcoin might not be superior technology wise, but it is the de facto standard for trading other cryptocurrencies.
- emodendroket 9y agoAre any of those less susceptible to any of the flaws mentioned here than Bitcoin is?
- afishisafish 9y agoYes, many altcoins serve different purposes other than just being a currency pur sang. Ethereum and NEO for example enable developers to build smart contracts (Dapps) with real-life use cases. Musiccoin tries to solve unfair royalty payouts in the music industry. There are so many new initiatived, and I'm convinced we are only at the very start of this blockchain revolution.
- jamesmattis 9y agoWhy there is so much negative PR going around about Bitcoin suddenly? I believe that people like Jamie Dimon trying to lower the price by creating these kind of stories to buy more. Bitcoin will rise no matter what. Atleast for 5 more years.
- kstenerud 9y agoBecause they've finally entered the mainstream. The normal press cycle follows a predictable pattern to keep people interested and reading: 1. New and interesting thing that the hardcore people use 2. Hopeful stories about the potential 3. Growing excitement as adoption reaches into "real" things 4. Doubt stories 5. Attack stories 6. Non-story
- toppy 9y agoFirst they ignore you, then they laugh at you, then they fight you, then you win
- krapp 9y ago... the fact that some geniuses were laughed at does not imply that all who are laughed at are geniuses. They laughed at Columbus, they laughed at Fulton, they laughed at the Wright Brothers. But they also laughed at Bozo the Clown. Carl Sagan
- anc84 9y agoBecause bullshit statements like "Bitcoin will rise no matter what. Atleast for 5 more years." are increasingly annoying.
- blunte 9y agoIf you look at how WSJ treats any subject, particularly bitcoin, you'll see that they are just a media company catering to their paying advertisers/audience. The substance of what they write is often questionable, if not out-right wrong. With respect to bitcoin, WSJ was slightly curious, then quite suspicious, then outright negative, then cautiously optimistic, then very bullish, then "DO YOU HAVE A BLOCKCHAIN?!", and now reigning in some of their foolish enthusiasm (about how blockchains will revolutionize _everything_). Like any successful politician, telling different stories at different times will satisfy more people.
- consz 9y agoIsn't this just an artifact of different writers having differing opinions on Bitcoin? I see no reason why a magazine with N > 1 writers should have a consistent opinion across the board on bitcoins (or anything).
- jankotek 9y agoI think OP complains about quality, not consistency. > So is a single bitcoin worth $500,000, $5,000, $500 or $0? I’m inclined to say $0 > The digital currency’s value depends on it becoming digital gold—or on criminals This is opinion (aka bu*hit).
- Hakashiro 9y agoI wish I could report these kinds of newspapers with paywalls. Hacker News should ban these sites. It doesn't make sense to share news nobody can read.
- TopDeadCenter 9y agoOverall, probably one of the weakest arguments I've heard yet about Bitcoin. Despite the title the author completely failed to show any evidence, let alone the "truth", of how or why Bitcoin was worth ZERO. This is obvious click bait, because the author knows that Bitcoin is trending right now and people considering buying it will open this when doing research. So the author wins in the ad revenue category, but the point he's trying to make basically sums up to : "Bitcoin is just a craze with no inherent value. Even though it's good money like gold, and people hang on to good money because it has inherent value. People spend bad money because they know it can lose value. But bad money is good because it's well regulated. And even though bitcoin is good money then it's worse then bad money because it's speculative. Gold is also completely speculative but it's been speculative for generations so don't worry about it. Also, Bitcoin takes a lot of electricity to mine. It's no where NEAR the amount of energy that mining and minting a tiny bar of gold takes, but I'm not going to mention that. I didn't really think about that part because I trade gold using Forex, which means that I essentially hold a digital representation of gold and don't actually physically hold any gold except my wife's jewelry. But if the government collapsed, then gold would still have value because it's physical, and digital assets like Bitcoin would be worthless. VERY convincing.
- transverse 9y agoWhy link to this paywalled article?
- SippinLean 9y agoTo me the wild ride showed a pretty solid wall of support at $3k
- Pietbull 9y agoAccording to his bio, James Macintosh (author) has a degree in Philosophy and masters in Psychology. Probably not the best basis for in-depth Bitcoin analysis/advice. #justsaying
- likeclockwork 9y agoReally? Psychology seems, to me, to be one of the best backgrounds for understanding Bitcoin.
- Pietbull 9y agoSure, for understanding people's reactions to it - but not understanding financial/technical/economical impact etc.