Bitcoin looks like a bubble to me. The way I think about investment is that you should only invest if you have a clear and rational reason to do so. There is

Bitcoin looks like a bubble to me. The way I think about investment is that you should only invest if you have a clear and rational reason to do so. There is a rational reason to use fiat: you need to pay taxes in it. The government also provides all sorts of guarantees about your cash when deposited in a bank. These are solid, irrefutable arguments. Investment in bitcoin seems to be based on an argument along the lines of “we need to change currency because centralised is bad” or “it’s just another form of gold”, or worse: “because it will keep going up”. None of these arguments make sense. Yes, maybe bitcoin will become a big currency. But why? Can you give a watertight answer as for the value of fiat? Some people answer “it’s decentralised”, but that is clearly untrue. Miners and exchanges are the centralised concentrations of power in bitcoin, but they are unregulated. The idea of cryptocurrency is interesting and exciting, but investing in something purely because it’s interesting or exciting is only a good idea if you’re happy to lose that money. No doubt bitcoin is important as a technological milestone, but that does not make it a good investment. When bitcoin crashes, it could undermine various startups, which will have a knock-on effect to the startup bubble we’re in. Presumably that won’t be enough to crash a stock market, unless bitcoin reaches astronomical levels. Hmm. Maybe I should buy some gold.