First things first lets understand this “The World is Disillusioned with Social Media Imaginary Lives” Ongoing Economic and Monetary Systems Transformation and there is indeed a whole lot of confusion on how the world tomorrow will evolve.
There are many questions and many responses to this but one thing for sure, its Bitcoin is not money nor its a stored value of an asset, it will never replace currency nor its has any of the attributes of Gold or Currency.
In the midst of all this Bitcoin has emerged as the best performer across various asset classes to which its compared against and now been told it will replace the means of transacting across borders and its value to continue increasing in a case of be it all and end all.
Human Greed knows no bounds especially so if its a subject out of disillusioned minds.
In the era of Fake News and Deregulated markets where accountability takes backstage coupled with a over educated under utilized millennium generation, Bitcoin is more of Fraud and a Ponzi and you may call it the revenge of the nerds.
Its Greed and Fear Combined, Perception of disillusioned minds. A fraud of no other kind and a Ponzi at the same time.
For any asset to remain as a stored value and become one as a currency, it needs to have three key attributes without which its just another Fraud and a Ponzi at the same time.
It needs to have an UNDERLYING to give its stored value, It needs to have a UTILITY without which there is no demand to hold and lastly it needs to have LIQUIDITY which is non volatile.
Attributes which Bitcoin doesn’t have.
Underlying Resource: An underlying resource of some kind is necessary to give any derivative its value against which the derivative is bench marked, US Treasuries and even Fiat Currency for example have an underlying asset class to back them up, Government revenues and Taxes are the underlying for every currency where economic growth and monetary management defines the currency value.
Gold is the perfect hedge in an stagflation environment in which we are currently in and Bitcoin is not gold, It has no underlying of its own to compare with to gold or to a currency and such perception is very much flawed.
It is wrong to say that Bitcoins Energy Consumption gives its underlying. It does not.
Just cause someone found out a water front property and build on it an exclusive luxurious home, spending huge sums of money to make it beautiful and comparing its construction costs as input of value and then comparing it to the prices in demand and further speculating that if just a tiny bit of demand comes from there, the prices will escalate to those levels in a fancy of disillusioned minds.
You can’t compare an sparsely populated island in the pacific to that of one which has demand and it’s no matter on how much money you spend in making it luxurious, its a waste of effort and time.
As the difficulty increases in mining of coins in order to make it a finite resource, more energy is consumed as efficiency drops and it then becomes scarce, this is the mathematical equation behind bitcoins miners and developers illusion, assuming that the input costs are part of the underlying, when its not.
Bitcoin uses more electricity than Uraguay, Kyrgyzstan, and Paraguay, yet what is the productivity use or value created out of this?
Gold is a finite resource with utility which makes it of asset of stored value of no other kind.
While it only takes 1.4 barrels of oil equivalent to produce an ounce of gold, it takes 10.1 barrels of oil equivalent to produce one Bitcoin.
Therefore as per the Maths.
Hence, anyone investing in Bitcoins needs to understand the total dynamics behind them and understand which asset if behaving more like a bubble.
Now if we are in agreement on input costs and the underlying just been a waste of valuable energy resources to output a single coin, lets look for the second most important attribute of that of Its value creating UTILITY and you will find there is none except for illegal money laundering, and stashing of hidden wealth from which Bitcoin has benefited enormously from the chaos and collapses of various economies across the world.
In fact Bitcoin founding and origination is mired in Mystery with rumors of the founder himself owning a million coins and we have various reports from a couple of years ago where sites which accepted Bitcoins in its infancy were gifted hundreds and thousands of coins.
First things first, If you are investing in either Bitcoin or Gold, it’s important to understand which asset is behaving more like a bubble than the other and Bitcoin is clearly a bubble and a Ponzi which needs fake news to thrive on.
Jimmy Loves Bitcoin. Jimmy needs to understand front running in unregulated markets leads to fraud and scam.
Listen to the audio file below to understand the meaning of front running, it happens a lot in bitcoin where the order fills are not in accordance to price. Exchanges and brokers are part of this scam, while people without any background and understanding are been suckered in.
Bitcoin needs a constant barrage of fake news and steady stream of new incomers into the scheme to justify high prices, if this is not a ponzi that what is? Its highly fraudulent by the misrepresentations occurring coupled with “Front Running” activities of brokers and exchanges in tandem with such activities.
In Conclusion, Fools and their money part always fast.
Federal Reserve Bank of Dallas
Globalization and Monetary Policy Institute | Working Paper No. 292
Does Bitcoin Reveal New Information About Exchange
Rates and Financial Integration?* | G. C. Pieters | Trinity University | December 2016
[embeddoc url=”http://banktech.net/wp-content/uploads/2017/11/Feds-Dallas-Financial-Intergration.pdf” viewer=”google”]
Does Governance Have a Role in Pricing? | Cross-Country Evidence From Bitcoin Markets
Robert Viglione | Department of Finance | Darla Moore School of Business | University of South Carolina | September 2015
[embeddoc url=”http://banktech.net/wp-content/uploads/2017/11/Governance-pricing-2013.pdf” viewer=”google”]
Chapter The Greed >>> Technopreneurship-The Successful Entrepreneur In The New Economy.
Back to the Beginning. http://ul3.com/aeVUG
BTAMSC – http://ul3.com/vAqdH
The Greed: http://ul3.com/pUDgd
The Hope: http://ul3.com/CuC7d
The Ignorant, Zombies: http://ul3.com/PP8Ez
Perception vs Reality: http://ul3.com/UcYb1
Chart Patterns: http://ul3.com/54VLV
Introduction to Technical Analysis. http://ul3.com/kcYCE
INTRODUCTION TO FINANCIAL MARKETS & TRADING OPPORTUNITIES IN COMMODITY, CURRENCY, & FINANCIAL FUTURES. http://ul3.com/dAFWj
Revolutionary Transformation Ongoing. http://ul3.com/kcYCE
– Global Economic Collapse January 18, 2016