I don’t trust the stability of Bitcoin. I trust it even less than fiat U.S. dollars. I see mining bitcoin as wasting electricity to produce… well, what does “mining” actually turn those gigawatt hours into? Isn’t it simply faith in it’s value by some subset of the worlds population? What if people start losing their faith? Doesn’t the value of Bitcoin decrease exponentially with this loss of faith? Once some sufficiently large number of people lose faith isn’t there a high likelihood of an avalanche of people losing faith? Isn’t it likely Bitcoin will go down in the history books as another Tulip bulb or Mississippi bubble?
There is also the risk of one or more countries declaring it illegal and reducing it’s trading value to near zero in that country.
It turns out there are far more subtle yet greater or equal threats to it’s value: Bitcoin’s Greatest Feature Is Also Its Existential Threat: The cryptocurrency depends on the integrity of the blockchain. But China’s censors, the FBI, or powerful corporations could fragment it into oblivion.
That article does raise some interesting points, though I’m sceptical the problem is really that big. Creating ledger entries is closely related to mining; it’s not cheap. Or perhaps more accurate (I’m going from memory here but I think this is right), ledger entries are consolidated into blocks (which are the elements of the “block chain”) and the action of making a block part of the block chain is the mining operation. In principle, miners could choose to refuse ledger entries that go against some standard of acceptable content. Also, big stuff (like images) fill up blocks much faster and therefore are not attractive for miners to process as valid ledger entries.
Second observation: all currencies, digital or otherwise, are entirely faith-based. They differ only in the number and fervency of the believers. For US dollars, these are high; for Bitcoin, less so. For Venezuelan Bolivars, much less indeed. But we haven’t had real money in a century.
The risk of outlawing seems more significant; if governments decide they can no longer tolerate the competition, that might start to happen.
You know where they are doing the mining? On YOUR computer! What I found on my laptop is a program running continuously, hogging the output, with my malware program with all it’s addresses changed. Can’t load a new version. Have to manually change it all back. If I knew who did it, they wouldn’t have to worry about mining anything anymore.
Not on my computer, I don’t run Windows. 🙂
I’ve been using a utility called Spywareblaster for decades. It’s basically sets a blacklist of evil cookies and scripts, including miners on your browsers. The free version you have to update manually, paid version is Auto.
China or Google might be able to break blockchain but the FBI would screw it up. And then blame white supremacists.
Bitcoin is just another medium of exchange, but not backed by any government. Just like the US dollar, it has no intrinsic value beyond what you can exchange it for in real items you need. Right now it’s riding very high, and that probably has something to do with a belief that the US has been spending money it doesn’t have for a very long time. Being a reserve currency means that spending is masking the inflation pressure that is building up. What happens when the US dollar isn’t the reserve currency for the world anymore?
I would say Bitcoin is as reliable as the wind/solar/5G power grid run by Kamama Harris, and the rest of the communist world.
One should be as well invested in ammo and canned goods as you are standard investments.
There is no currency that can’t be stolen. And if history be judging. Replace the word, Can’t, with Won’t.
Just read a Zerohedge article. About Chinese central bank creating a gold backed Yuan. Beijing green lights billions in gold purchases.
What they won’t tell you is that China was buying gold at $300/Oz. for 15 yrs. to do this. Their announcement is meant to drive the price of gold through the roof. And replace the dollar with gold backed Yuan.
This is just another facet of China’s, “Unrestricted war policy” against America. It’s working. No wonder business is siding with them. Were about to get a biblical ass-whooping. Hyperinflation is coming to a culture addicted to instant gratification.
They couldn’t do more damage with a thermo-baric bombs strapped on a hyper-sonic missiles. Which they also have.
Life as we know it is about to change. And like most ambushes. It happens faster than you can adapt. Their inside our OODA loop.
The last time we fought the Chinese we had Chesty Puller. This time we got Joe Biden. Act accordingly.
The only difference between CryptoCurrencies and Fiat Currencies is one has the OFFICIAL BACKING of the issuing government. For some countries….like the Swiss that backing is almost….not quite but almost as good as actual gold. For other countries….like Zimbabwe, Venezuela and eventually US that backing is specious at best. When times are good and everything is calm fiat currencies have been an acceptable form of currency. But they are ALWAYS subject to debasement and inflation because doing so allows a small group of connected people to amass great wealth. Thus fiat currencies will ALWAYS eventually be debased and inflated.
What? You don’t think magic numbers are worth $60,000 each?
All the cool kids do!
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