Jamie Dimon, the CEO of JP Morgan, said that the Bitcoin was a fraud. JP Morgan would fire any employee who trades the Bitcoin for his being stupid. Dimon was also asked about some alternative great economy that will run on the Bitcoin and avoid taxes and other aspects of the government supervision and he said that it obviously won't happen. The Bitcoin is used as a mechanism for tax evasion and other crimes and when the lost taxes get too high, the governments will simply ban the Bitcoin.
Some cultists say that the Bitcoin cannot be banned because people make the payments in their living rooms, just with their computer, and the exchanges are in principle unnecessary. This claim is exactly equivalent to saying that hashish cannot be banned as a currency. Hashish is banned as a currency. You can use sell it and buy it – use it for payments – and quite often, no one will see you. But if someone sees you, e.g. if your other party turns out to be a policeman or agent-provocateur, you are in trouble! It may be exactly the same with the cryptocurrencies and indeed, if those would expand the black economy, the status of the Bitcoin and hashish will have to be put on equal footing (as El-Erian of Pimco said, the governments won't allow the mass adoption that is already priced-in in the Bitcoin's price).
I agree with every single word by Dimon, he is an adult in the room. Well, I added some words and I am confident that Dimon would agree with those, too.
John McAfee, the antivirus legend has promised to cut his dick if the Bitcoin doesn't cost $500,000 in a few years is afraid of his little friend. So he tried to contradict Mr Dimon.
Well, I think that McAfee's reasoning is absolutely irrational and stupid, like the reasoning of most of the Bitcoin cultists. Let me copy a paragraph from the CNBC story:
McAfee says that the fiat money is fraud because the paper costs nothing while he has to spend $1,000 to mine a Bitcoin, so that is not fraud. Is he joking?
The fact that the physical medium that represents the fiat money costs almost nothing is a vital virtue of this system and it's what makes it practical. Gold was used to store wealth and make payments but there were impractical things about gold. You couldn't easily figure out whether the amount of gold is right, or at least whether the content is pure gold and not some mixture of cheaper metals that happens to be equally heavy, and so on. It may cost too much money to create gold coins, clean them, and to do and guarantee other things.
The paper money works at least as efficiently for non-gold payments in everyday situations but these expenses associated with gold are gone. Moreover, the inflation rate may be targeted more easily so the value of the fiat money is more stable or more predictable, making everyone's financial planning and decisions easier and more accurate. Moreover, gold whose total value on the surface of Earth is some $7 trillion wouldn't be enough to replace the money supply, at least some types of it.
The fiat money concept is the carefully extracted essence of everything that was useful about gold as a payment system. The extracted essence is the simplest and cheapest possible way to reliably remember how to quantify trust, how to make the system know how much each person owes to the rest of the nation or mankind, or vice versa. With gold, if you made sure no one stole your gold, you could be certain that the gold remembers how much the other people may do for you in the future. The fiat money allows you the same thing, approximately equally safely, equally reliably, and more predictably when it comes to the evolution of the amount in time.
Is some fraud going on when a $100 banknote is printed? The central bank (the Federal Reserve in this case) has an unlimited capacity to print the money but is it stealing? The central bank is really not another player, it's out of the system. When it prints a $100, it simultaneously creates the de facto obligation to back this banknote by a basket of products included in the inflation basket. If the central bank prints a quadrillion of dollars and keeps them in the basement, it doesn't change an iota about the external economy. No one's life is affected in any way.
The economy is only affected when the money is pumped from the basement of the central bank to the real world. But according to the laws, the money may only be consensually traded at market prices. The central bank indeed has the capacity to pump the price of the bonds up by buying them and do similar things – that more or less distort the markets (the price ratios). They should ideally distort the market minimally. But no one is stealing anything. All the exchange is consensual.
When an excessive number of $100 banknotes get from the central bank's basement to the real world, the central bank isn't just giving something for free. It gave the money for something – for example, the new owners of the banknotes had to send some bonds to the central bank – and the central bank didn't get this bond for free, either. By emitting another $100 banknote, it has contributed to the rise of inflation. But because the inflation is being targeted, it will have to do some inverse operation sometime in the future that compensates for the excessive ad hoc emission of the banknotes. So the total tally is just zero. But even if it were nonzero, it doesn't matter because the central bank isn't really anyone's competitor in the U.S. And the individual bankers such as Ms Yellen can't directly take the banknotes from the Federal Reserve. The money isn't theirs. One can study the lives of all others, individuals and companies, and those are maximally stable when something like the inflation rate is targeted.
Now, McAfee pays $1,000 for the electricity and it's supposed to make the Bitcoin "less fraudulent". It's primarily "more wasteful" because the electricity and GPUs that cost $1,000 are literally wasted. Someone may call his $1,000 a proof of work but a rational person primarily notices that it must also be called useless work and wasted money. It's plain stupid to work within a system where you need to do $1,000 worth of hard work to achieve something that may be done for free, without work, in other systems. This spending is completely similar to printing expensive paper $100 banknotes that would cost $25 to be made. Someone has to pay $1,000 for the Bitcoin mining electricity or save the same amount of electricity. The miner may be paid but someone else has to pay it. If it's the rest of the Bitcoin community, then the community is stupid to pay this $1,000. If it's the rest of the mankind who actually pays for the electricity, it would be stupid for the rest of the mankind not to ban the Bitcoin. There's no conceivable answer that would be good for the Bitcoin. Spending electricity that doesn't have to be spent simply isn't a good idea.
But let's return to the "honesty" of the Bitcoin. If you were creating Bitcoins for $1,000 a piece, you would still be making the remaining $2,861 included in the price of the Bitcoin out of thin air. The current price is $3,861 per Bitcoin when I am writing this sentence, a drop by 25% from a recent maximum. So some 70% of the price of the Bitcoin was still created out of thin air – in the same way as the fiat money in the central bank. Are you honest once 30% of your income comes from honest sources? It's ludicrous, isn't it? It's the amount of the money that you steal that determines how dishonest or illegal you are. So if any "printing of money out of thin air" is considered bad, and a reason to criticize the central banks, then the Bitcoin mining is still equally bad! The money earned by fair work is irrelevant – after all, you may hire someone else to do it if you can safely afford to pay him, and you indeed may afford it if you earn some extra $2,861 per Bitcoin. By simply outsourcing all the honest work to someone else, you can frame yourself as a 100% villain – nothing really changes about your behavior by this framing.
However, in the Bitcoin case, it's worse. No "real person" is actually stealing most of the wealth included in the newly printed fiat money. In the case of the miners, if they happen to mine a $3,861 Bitcoin and it only costs them $1,000, real people are literally stealing $2,861 per Bitcoin from others, while extra $1,000 is wasted from everyone's viewpoint. No real people are stealing anything when the Federal Reserve is printing the banknotes – the account of the Federal Reserve is a completely decoupled or "abstract" entity.
So nominally, 3/4 of the mined Bitcoins are as "fraudulent" and "printed out of nothing" as the banknotes but the Bitcoin situation is worse because the newly mined money is being acquired by very particular physical people!
Needless to say, when it's possible to mine the Bitcoins this cheaply, other companies start to do it, so that the longer-term profit for mining is very small. Sometimes you need to spend more for GPU and electricity than the Bitcoins cost, sometimes less, and the average isn't terribly profitable – otherwise more people would be doing that. The GPU farms in Iceland probably have the highest profit margin from mining because they save the money for cooling.
The moral classification offered by McAfee is completely silly – there's no viewpoint from which the creation of the new Bitcoins would be more ethical than the printing of the new money. But one should also look at it from a calmer objective viewpoint – from the viewpoint of the efficiency of the whole system. And if $1,000 needs to be wasted for increasing the money supply by $3,861, then $1,000 per Bitcoin is simply wasted. Real electricity and silicon of this price is being wasted and that's what makes this monetary system inferior, not superior, relatively to a system where these neutral operations cost almost nothing. It's a fun piece of recreational mathematics to discover how the mining – solving of difficult tasks that devour a lot of electricity – may allow a decentralized or distributed ledger. But this piece of recreational mathematics isn't making the system more practical. By wasting the electricity for the mining, it makes it less practical than the regular "centralized" system of payments. Maybe in some special circumstances, the decentralization or distribution may be important and the electricity spent for mining may be a good investment. But in the everyday context, the decentralization of the ledger clearly isn't too important and the electricity needed to mine the new coins and validate the transactions in a decentralized way is just wasted.
I think that every kid with common sense would know why a $100 banknote that costs as much as $25 instead of the current 14.3 cents to be printed is a very bad idea because the usage of banknotes effectively includes some huge tax – some extra expenses that someone, either users of the banknote or the taxpayers, have to pay for by their real money, i.e. by their real work or sacrifices. Why is it so hard for the Bitcoin cultists to understand exactly the same things in the case of the Bitcoin?
Also, I was amazed by Tony's comments indicating that he believes that by owning the cryptocoins, you're owning stocks in some great modern banks and new infrastructure. Clearly, these things have absolutely nothing to do with each other. The Bitcoin is just a virtual thingy whose price is zero in the efficient markets. The temporary nonzero price is a result of the inefficiency of the markets and the price has equal chances to go up and to go down. But the Bitcoin exchanges – while depending on this cryptocurrency mania – are making a predictable profit because they charge fees per each operation – which is positive – and they surely turn much of the profit to real currencies such as the U.S. dollars. Or at least, they can do that. And Tony, as a holder of many Bitcoins, isn't getting anything out of this predictable profit. He just owns something virtual whose price may go up by 25% next month, but it may also go down by another 25% in the next month, just like it did decrease from the recent $5,000+ peak weeks ago. He's a client of some cryptocoin exchanges contributing to their profits, not one of the owners of those exchanges.
It was the tulip bulbs whose price grew insanely and then collapsed by 99% in February 1637 but tulips are prettier even though surely not as pretty as the traders believed after 1634 and before February 1637. ;-)
With hindsight, this mania looks incredible to me. Can't you produce basically as many tulip bulbs as you want after an exponential growth in several years?
McAfee's and Tony's comments, among many others, make me absolutely certain than people's complete economic illiteracy is the most important condition that allows them to become members of this cryptocurrency cult. These people don't understand why the money is a good idea, they can't distinguish money from stocks of banks, and therefore clients of banks from the stockholders and from employees, they can't distinguish wasted electricity from usefully spent electricity, they have clearly never tried to determine the fundamental value of anything, they're irrational about many other things. They're obsessed with some hatred towards the fiat money and their printing but they completely fail to understand why this is – along with some targeting that makes the value of the fiat money predictable – one of the greatest inventions in the history of economics, something that makes the lives of the people and companies as materially happy and the growth and progress as high as you can get.
They're obsessed with the idea that the number of "coins" that are out there should be bounded from above, e.g. by 21 million. But this bound doesn't imply any advantages at all. When the economy grows like mad and people produce a vastly bigger amount of cars or other things than a decade ago, it's natural for the money supply to nominally go up, too. At any rate, the changes of the Bitcoin's price are far faster than the changes of the real GDP or money supply in healthy, fiat-money-based economies, so whether the number of the Bitcoins is bounded by 21 billion or whether the number would be allowed to increase by a few percent a year is absolutely irrelevant because a few percent is negligible relatively to 500% that expresses a typical change of the Bitcoin per year (e.g. the most recent one).
Yesterday, "half-god" Marko Kolanovic of JP Morgan argued that the worshiped "scarcity of the Bitcoin" is the main feature that actually proves the pyramid-scheme nature of this system.
Let me also emphasize that if some currency unit is really used as the main currency in an economy, the "real" money supply will unavoidably grow above the nominal one. If the Bitcoins became usable for long-term storage of wealth and purchase of ordinary things, people would unavoidably start to borrow the Bitcoins, too. Bitcoin bonds would be issued and those would be effectively equivalent to extra Bitcoins. Their prices expressed in the Bitcoins themselves would become rather stable and you could use them instead of the Bitcoins. So the fact that the number of the original underlying Bitcoins is limited would become irrelevant – more inclusive parts of the money supply would be born, anyway. The boundedness of the number of "pure Bitcoins" only makes sense to the extent to which the Bitcoin economy doesn't really exist – doesn't allow you the normal things you're used to such as to borrow the money.
There are surely people and traders who are trading the Bitcoin and they know what they are doing. They are just trying to make profit out of an enterprise whose basis is irrational and that revolves around a cult powered by the economic and financial illiteracy. But these adults in the room of Bitcoin traders still depend on the irrational behavior of some people in this set. If all the people dealing with the Bitcoin started to behave rationally, the price of the Bitcoin would quickly converge to its fundamental value, namely zero. So to some extent, all the Bitcoin traders are managers of very irrational people's wealth.
BTCUSD lost almost 10% today so far. Dimon said it's fraud, BTC China exchange is closing, Kraken will probably follow. You have 5 ways to short BTC and because many people learn about them, I guess that the shortening will begin, and the collapse may continue.
Some cultists say that the Bitcoin cannot be banned because people make the payments in their living rooms, just with their computer, and the exchanges are in principle unnecessary. This claim is exactly equivalent to saying that hashish cannot be banned as a currency. Hashish is banned as a currency. You can use sell it and buy it – use it for payments – and quite often, no one will see you. But if someone sees you, e.g. if your other party turns out to be a policeman or agent-provocateur, you are in trouble! It may be exactly the same with the cryptocurrencies and indeed, if those would expand the black economy, the status of the Bitcoin and hashish will have to be put on equal footing (as El-Erian of Pimco said, the governments won't allow the mass adoption that is already priced-in in the Bitcoin's price).I agree with every single word by Dimon, he is an adult in the room. Well, I added some words and I am confident that Dimon would agree with those, too.
John McAfee, the antivirus legend has promised to cut his dick if the Bitcoin doesn't cost $500,000 in a few years is afraid of his little friend. So he tried to contradict Mr Dimon.
Well, I think that McAfee's reasoning is absolutely irrational and stupid, like the reasoning of most of the Bitcoin cultists. Let me copy a paragraph from the CNBC story:
"You called bitcoin a fraud," McAfee told CNBC's "Fast Money" on Wednesday. "I'm a bitcoin miner. We create bitcoins. It costs over $1,000 per coin to create a bitcoin. What does it cost to create a U.S. dollar? Which one is the fraud? Because it costs whatever the paper costs, but it costs me and other miners over $1,000 per coin. It's called proof of work."Wow. One can see it's based on some irrational hatred towards central banks and the fiat money and this hatred is widespread in a certain corner of the libertarians. But if proposed as a rational argument, it's dumb as a doorknob.
McAfee says that the fiat money is fraud because the paper costs nothing while he has to spend $1,000 to mine a Bitcoin, so that is not fraud. Is he joking?
The fact that the physical medium that represents the fiat money costs almost nothing is a vital virtue of this system and it's what makes it practical. Gold was used to store wealth and make payments but there were impractical things about gold. You couldn't easily figure out whether the amount of gold is right, or at least whether the content is pure gold and not some mixture of cheaper metals that happens to be equally heavy, and so on. It may cost too much money to create gold coins, clean them, and to do and guarantee other things.
The paper money works at least as efficiently for non-gold payments in everyday situations but these expenses associated with gold are gone. Moreover, the inflation rate may be targeted more easily so the value of the fiat money is more stable or more predictable, making everyone's financial planning and decisions easier and more accurate. Moreover, gold whose total value on the surface of Earth is some $7 trillion wouldn't be enough to replace the money supply, at least some types of it.
The fiat money concept is the carefully extracted essence of everything that was useful about gold as a payment system. The extracted essence is the simplest and cheapest possible way to reliably remember how to quantify trust, how to make the system know how much each person owes to the rest of the nation or mankind, or vice versa. With gold, if you made sure no one stole your gold, you could be certain that the gold remembers how much the other people may do for you in the future. The fiat money allows you the same thing, approximately equally safely, equally reliably, and more predictably when it comes to the evolution of the amount in time.
Is some fraud going on when a $100 banknote is printed? The central bank (the Federal Reserve in this case) has an unlimited capacity to print the money but is it stealing? The central bank is really not another player, it's out of the system. When it prints a $100, it simultaneously creates the de facto obligation to back this banknote by a basket of products included in the inflation basket. If the central bank prints a quadrillion of dollars and keeps them in the basement, it doesn't change an iota about the external economy. No one's life is affected in any way.
The economy is only affected when the money is pumped from the basement of the central bank to the real world. But according to the laws, the money may only be consensually traded at market prices. The central bank indeed has the capacity to pump the price of the bonds up by buying them and do similar things – that more or less distort the markets (the price ratios). They should ideally distort the market minimally. But no one is stealing anything. All the exchange is consensual.
When an excessive number of $100 banknotes get from the central bank's basement to the real world, the central bank isn't just giving something for free. It gave the money for something – for example, the new owners of the banknotes had to send some bonds to the central bank – and the central bank didn't get this bond for free, either. By emitting another $100 banknote, it has contributed to the rise of inflation. But because the inflation is being targeted, it will have to do some inverse operation sometime in the future that compensates for the excessive ad hoc emission of the banknotes. So the total tally is just zero. But even if it were nonzero, it doesn't matter because the central bank isn't really anyone's competitor in the U.S. And the individual bankers such as Ms Yellen can't directly take the banknotes from the Federal Reserve. The money isn't theirs. One can study the lives of all others, individuals and companies, and those are maximally stable when something like the inflation rate is targeted.
Now, McAfee pays $1,000 for the electricity and it's supposed to make the Bitcoin "less fraudulent". It's primarily "more wasteful" because the electricity and GPUs that cost $1,000 are literally wasted. Someone may call his $1,000 a proof of work but a rational person primarily notices that it must also be called useless work and wasted money. It's plain stupid to work within a system where you need to do $1,000 worth of hard work to achieve something that may be done for free, without work, in other systems. This spending is completely similar to printing expensive paper $100 banknotes that would cost $25 to be made. Someone has to pay $1,000 for the Bitcoin mining electricity or save the same amount of electricity. The miner may be paid but someone else has to pay it. If it's the rest of the Bitcoin community, then the community is stupid to pay this $1,000. If it's the rest of the mankind who actually pays for the electricity, it would be stupid for the rest of the mankind not to ban the Bitcoin. There's no conceivable answer that would be good for the Bitcoin. Spending electricity that doesn't have to be spent simply isn't a good idea.
But let's return to the "honesty" of the Bitcoin. If you were creating Bitcoins for $1,000 a piece, you would still be making the remaining $2,861 included in the price of the Bitcoin out of thin air. The current price is $3,861 per Bitcoin when I am writing this sentence, a drop by 25% from a recent maximum. So some 70% of the price of the Bitcoin was still created out of thin air – in the same way as the fiat money in the central bank. Are you honest once 30% of your income comes from honest sources? It's ludicrous, isn't it? It's the amount of the money that you steal that determines how dishonest or illegal you are. So if any "printing of money out of thin air" is considered bad, and a reason to criticize the central banks, then the Bitcoin mining is still equally bad! The money earned by fair work is irrelevant – after all, you may hire someone else to do it if you can safely afford to pay him, and you indeed may afford it if you earn some extra $2,861 per Bitcoin. By simply outsourcing all the honest work to someone else, you can frame yourself as a 100% villain – nothing really changes about your behavior by this framing.
However, in the Bitcoin case, it's worse. No "real person" is actually stealing most of the wealth included in the newly printed fiat money. In the case of the miners, if they happen to mine a $3,861 Bitcoin and it only costs them $1,000, real people are literally stealing $2,861 per Bitcoin from others, while extra $1,000 is wasted from everyone's viewpoint. No real people are stealing anything when the Federal Reserve is printing the banknotes – the account of the Federal Reserve is a completely decoupled or "abstract" entity.
So nominally, 3/4 of the mined Bitcoins are as "fraudulent" and "printed out of nothing" as the banknotes but the Bitcoin situation is worse because the newly mined money is being acquired by very particular physical people!
Needless to say, when it's possible to mine the Bitcoins this cheaply, other companies start to do it, so that the longer-term profit for mining is very small. Sometimes you need to spend more for GPU and electricity than the Bitcoins cost, sometimes less, and the average isn't terribly profitable – otherwise more people would be doing that. The GPU farms in Iceland probably have the highest profit margin from mining because they save the money for cooling.
The moral classification offered by McAfee is completely silly – there's no viewpoint from which the creation of the new Bitcoins would be more ethical than the printing of the new money. But one should also look at it from a calmer objective viewpoint – from the viewpoint of the efficiency of the whole system. And if $1,000 needs to be wasted for increasing the money supply by $3,861, then $1,000 per Bitcoin is simply wasted. Real electricity and silicon of this price is being wasted and that's what makes this monetary system inferior, not superior, relatively to a system where these neutral operations cost almost nothing. It's a fun piece of recreational mathematics to discover how the mining – solving of difficult tasks that devour a lot of electricity – may allow a decentralized or distributed ledger. But this piece of recreational mathematics isn't making the system more practical. By wasting the electricity for the mining, it makes it less practical than the regular "centralized" system of payments. Maybe in some special circumstances, the decentralization or distribution may be important and the electricity spent for mining may be a good investment. But in the everyday context, the decentralization of the ledger clearly isn't too important and the electricity needed to mine the new coins and validate the transactions in a decentralized way is just wasted.
I think that every kid with common sense would know why a $100 banknote that costs as much as $25 instead of the current 14.3 cents to be printed is a very bad idea because the usage of banknotes effectively includes some huge tax – some extra expenses that someone, either users of the banknote or the taxpayers, have to pay for by their real money, i.e. by their real work or sacrifices. Why is it so hard for the Bitcoin cultists to understand exactly the same things in the case of the Bitcoin?
Also, I was amazed by Tony's comments indicating that he believes that by owning the cryptocoins, you're owning stocks in some great modern banks and new infrastructure. Clearly, these things have absolutely nothing to do with each other. The Bitcoin is just a virtual thingy whose price is zero in the efficient markets. The temporary nonzero price is a result of the inefficiency of the markets and the price has equal chances to go up and to go down. But the Bitcoin exchanges – while depending on this cryptocurrency mania – are making a predictable profit because they charge fees per each operation – which is positive – and they surely turn much of the profit to real currencies such as the U.S. dollars. Or at least, they can do that. And Tony, as a holder of many Bitcoins, isn't getting anything out of this predictable profit. He just owns something virtual whose price may go up by 25% next month, but it may also go down by another 25% in the next month, just like it did decrease from the recent $5,000+ peak weeks ago. He's a client of some cryptocoin exchanges contributing to their profits, not one of the owners of those exchanges.
It was the tulip bulbs whose price grew insanely and then collapsed by 99% in February 1637 but tulips are prettier even though surely not as pretty as the traders believed after 1634 and before February 1637. ;-)
With hindsight, this mania looks incredible to me. Can't you produce basically as many tulip bulbs as you want after an exponential growth in several years?
McAfee's and Tony's comments, among many others, make me absolutely certain than people's complete economic illiteracy is the most important condition that allows them to become members of this cryptocurrency cult. These people don't understand why the money is a good idea, they can't distinguish money from stocks of banks, and therefore clients of banks from the stockholders and from employees, they can't distinguish wasted electricity from usefully spent electricity, they have clearly never tried to determine the fundamental value of anything, they're irrational about many other things. They're obsessed with some hatred towards the fiat money and their printing but they completely fail to understand why this is – along with some targeting that makes the value of the fiat money predictable – one of the greatest inventions in the history of economics, something that makes the lives of the people and companies as materially happy and the growth and progress as high as you can get.
They're obsessed with the idea that the number of "coins" that are out there should be bounded from above, e.g. by 21 million. But this bound doesn't imply any advantages at all. When the economy grows like mad and people produce a vastly bigger amount of cars or other things than a decade ago, it's natural for the money supply to nominally go up, too. At any rate, the changes of the Bitcoin's price are far faster than the changes of the real GDP or money supply in healthy, fiat-money-based economies, so whether the number of the Bitcoins is bounded by 21 billion or whether the number would be allowed to increase by a few percent a year is absolutely irrelevant because a few percent is negligible relatively to 500% that expresses a typical change of the Bitcoin per year (e.g. the most recent one).
Yesterday, "half-god" Marko Kolanovic of JP Morgan argued that the worshiped "scarcity of the Bitcoin" is the main feature that actually proves the pyramid-scheme nature of this system.
Let me also emphasize that if some currency unit is really used as the main currency in an economy, the "real" money supply will unavoidably grow above the nominal one. If the Bitcoins became usable for long-term storage of wealth and purchase of ordinary things, people would unavoidably start to borrow the Bitcoins, too. Bitcoin bonds would be issued and those would be effectively equivalent to extra Bitcoins. Their prices expressed in the Bitcoins themselves would become rather stable and you could use them instead of the Bitcoins. So the fact that the number of the original underlying Bitcoins is limited would become irrelevant – more inclusive parts of the money supply would be born, anyway. The boundedness of the number of "pure Bitcoins" only makes sense to the extent to which the Bitcoin economy doesn't really exist – doesn't allow you the normal things you're used to such as to borrow the money.
There are surely people and traders who are trading the Bitcoin and they know what they are doing. They are just trying to make profit out of an enterprise whose basis is irrational and that revolves around a cult powered by the economic and financial illiteracy. But these adults in the room of Bitcoin traders still depend on the irrational behavior of some people in this set. If all the people dealing with the Bitcoin started to behave rationally, the price of the Bitcoin would quickly converge to its fundamental value, namely zero. So to some extent, all the Bitcoin traders are managers of very irrational people's wealth.
BTCUSD lost almost 10% today so far. Dimon said it's fraud, BTC China exchange is closing, Kraken will probably follow. You have 5 ways to short BTC and because many people learn about them, I guess that the shortening will begin, and the collapse may continue.
McAfee's irrational pro-Bitcoin arguments
Reviewed by DAL
on
September 13, 2017
Rating:
Reviewed by DAL
on
September 13, 2017
Rating:
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