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The value of bitcoin has risen by 57.2% since the early 2020s The bull movement has emboldened bitcoin bulls who say the cryptocurrency is a cost reserve for investors involved in inflation.
Actually, the cryptocurrency bear’s thesis is alive and kicking.Bitcoin and the budget like the Grayscale Bitcoin Trust (OTC: GBTC) are not investments.Cryptocurrency transactions are far from the nameless and risk-free transactions for which they are advertised.
There are 3 main reasons why I stay away from bitcoin: first, I don’t want it as a payment option, at most for other people who make legal transactions, credit cards or payment apps like PayPal (NASDAQ: PYPL) and the Cash Square app.(NYSE: SQ) facilitates virtual payments.
Bitcoin bulls love the decentralization of cryptocurrencies, but the fact that no one controls Bitcoin transactions means that there are few resources in case of fraud or theft.If I make a fraudulent transaction with my credit card, I touch my bank and waive payment.If you make a fraudulent bitcoin transaction? Bad luck.
There is a belief that cryptocurrencies are secure because blockchain generation is secure.The blockchain formula can be secure. But this is a long way from the security of transactions and the storage of cryptocurrencies; in fact, more than $4.5 billion in cryptocurrencies were stolen in 2019 through piracy or fraud.
Secondly, bitcoin is a terrible reserve of value.There is a difference between an asset that generates high returns in the short-term market and an asset with a reserve of counterfeit value.Of course, the value of bitcoin has risen by 57% this year.Highest to 89% in 2019 and 69% in 2017.
Finally, if bitcoin is not a value reserve, what is it?Basically, the answer is that it’s a lot of code, it has no intrinsic value.It does not have an exclusive purpose In essence, the one who buys bitcoin buys it only for an explanation.
They buy it in the hope that at some point in the future, whether a week, a year or 30 years later, they will sell it to someone else at a higher price.
There is a call for this type of investment that is used to explain the pumping and emptying systems related to subtitles, this is called the theory of the biggest idiot, basically the theory is that when you buy something worthless, you are necessarily acting like a fool..but the hope is that at some point in the future, you will be able to sell the asset to a bigger idiot at a higher price.
As a general rule, I try not to make silly investments, even though I think there are even more idiots out there.
Bill Harris, ceo of PayPal, once bitcoin was “the biggest scam ever.”
“Bitcoin is a scam. In my opinion, it’s a colossal pumping and drainage formula like the global one has never seen,” Harris said.
Young love Tesla CEO Elon Musk (NASDAQ: TSLA).Musk once said that his position on cryptocurrencies “makes cryptocurrencies angry.”
“For illegal transactions to occur, the money will also have to be used for legal transactions.You want an illegal to legal bridge. That’s where cryptography comes in,” Musk said.
But the quote comes from afar from iconic Wall Street investor Warren Buffett, who called bitcoin a “rat poison square.”
“Cryptocurrencies don’t have essentially priceArray … You can’t do anything and sell them to someone else,” Buffett said in early 2020.
I agree with Buffett, Bitcoin is great and blockchain generation is a revolutionary idea, but Bitcoin is a terrible reserve of value.
The average user does not use this in legal and daily transactions and is closer to a ploy than a viable long-term investment, which is why the Securities and Exchange Commission has continually rejected bitcoin ETFs as investments.
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