The case against Bitcoin as an investable asset is long and compelling. It has no use case; there’s almost nothing you can buy with a Bitcoin, and it has no return other than higher prices based on an application of the greater fool theory.
A glance at the price chart shows it’s clearly a bubble, the worst in history, worse than NASDAQ in 2000 during the dot.com frenzy and worse than the Japanese stock market in 1989.
Bitcoin will never be a reserve currency because its capped issuance amount makes its price deflationary, which is unattractive to borrowers. Without a Bitcoin bond market, there can be no securities in which central banks can invest reserves.
Worse yet, the Bitcoin price is a Ponzi scheme driven by the issuance of the stable coin Tether, which has never accounted for the billions of dollars that have been taken from naïve Tether investors. That said, none of this matters.
Bitcoin has become a belief system. The true believers see what they want, hear what they want and are immune to the arguments of the non-believers.
Bitcoin will never displace the dollar, but it could destroy confidence in the dollar by its all-encompassing impact. This could cause social disorder and contribute to the decline of linear, rational civilization.
My solution to this conundrum is to hold physical gold. For the Bitcoin believers (and others), the solution is always… more Bitcoin.
The market is becoming unhinged. Gold can be your anchor.
March 15, 2021
The “Bros” Are Preparing Their Next Attack
[I’m not certain it is as compelling as Rickards appears to claim. And you will notice he is not consistent. He claims it has no use case but how can it “destroy confidence in the dollar by its all-encompassing impact” if it can’t be used for anything?
But I am in general agreement with him. I own zero Bitcoin. I do own some gold.—Joe]