It’s hard to know when bubbles will end but when analysis goes ape-sh*t batty, it’s easy to know the bubble exists.
Jim Cramer’s analysis of Bitcoin provides a perfect example.
CNBC reports Cramer says it’s possible bitcoin could reach $1 million one day.
The price of digital currency stockpiled by companies to pay off potential cyberthreats could reach $1 million one day, CNBC’s Jim Cramer said Wednesday.
Cramer was responding to a recent comment by Business Insider CEO Henry Blodget, who said bitcoin could go to $1 million.
“I think it could because the European banks are frantically trying to buy them so they can pay off ransomware. It’s a short-term way to be able to deal with cybersecurity. It is the way to pay off the bad guys,” Cramer said on “Squawk on the Street.”
“When you get hit and you’re not sure how to do bitcoin, these cyberattackers have customer service desks,” Cramer said.
What Blodget Really Said
Blodget also mentioned the downside: “Bitcoin could go to $1 million (or fall to $0),” said Blodget maintains the view that “ultimately, Bitcoin has no intrinsic value.”
New Target $1,000,000
The Coin Telegraph reports Bitcoin Price Can Reach $1 Mln: CNBC’s Jim Cramer.
On the CNBC show “Squawk on the Street,” Cramer stated that the demand toward Bitcoin is rapidly increasing and because of Bitcoin’s decentralized nature, its price could potentially enter the $1 mln region, which would bring the market cap of Bitcoin to tens of trillions of dollars.
However, Cramer’s reasoning behind his Bitcoin price prediction was fundamentally flawed as he failed to grasp the core purpose of Bitcoin and why investors are starting to purchase Bitcoin.
“I think it could because the European banks are frantically trying to buy them so they can pay off ransomware. It’s a short-term way to be able to deal with cybersecurity. It is the way to pay off the bad guys.”
Such claim is evidently non-factual because the European Bitcoin exchange market only accounts for nine percent of the global Bitcoin exchange market and it is behind the US, Japan, China and South Korea in trading volumes.
More importantly, Cramer’s statement fails to consider the fact that Bitcoin is being utilized as a currency and safe haven asset more than it is being used as a lifeline to feed ransomware developers.
In the case of WannaCry ransomware, the biggest ransomware attack in history, the distributors earned less than $100,000. That is only 0.0012 percent of the European Bitcoin exchange market. Thus, to say that Bitcoin price is rising because of 0.0012 percent of traders from the fifth largest Bitcoin exchange market is not an accurate depiction of the surging Bitcoin price.
Regardless, Cramer believes that Bitcoin price will reach $1 mln one day due to its rapidly increasing trading volumes and demand from investors.
Frantically “Trying” to Buy Bitcoins?!
The idea that banks need to “try” to buy Bitcoins is absurd.
Do. Or do not. There is no try.
Customer Service Desks
Cyberattackers have “customer service desks”? really? And they can be trusted? And banks don’t have backups? So banks need to “try” to stockpile Bitcoins as a precaution? And that will push the price to $1,000,000?
At least Henry Blodget discussed the downside without absurd hype.
Action to Take
If you think Bitcoin has any chance of hitting $1,000,000 then buy one for $2,725 or so and relax. Bitcoin is a life-long insurance policy.
Unlike term insurance, Bitcoin never expires. And unlike real estate, it’s easily divisible.
So buy one, put it in your will, and pass it to your kids. But make them promise to hold on to it. After all, a single Bitcoin may very well be worth $1 billion someday!
Why not? Why not $10 billion?
Even at $1 million, the world would be flooded with tens-of-thousands or hundreds-of-thousands of dollar “billionaires”.
Hyperinflation Anyone?
Back in the real world, please think of what it would take for Bitcoin to hit $1,000,000. The answer is hyperinflation. The US dollar would essentially go to zero vs everything.
So when Cramer or anyone else discusses the possibility of $1,000,000 Bitcoins, they are really discussing the possibility of hyperinflation in US dollars.
Act Now Before It’s Too Late
This setup reminds me of a post I did in 2005: It’s Too Late.
I think it’s too late.
In fact I know it’s too late.
How do I know?
The following Email I received tonight should explain it nicely.
When you see stuff like this, not only is it too late, it’s way too late.
As a practical matter, and without all the hype, I will stick with gold even as I wish I had taken out some Bitcoin insurance at $1, $10, $100, or even $1,000.
Supposedly, it’s still not too late.
Mike “Mish” Shedlock
Also you should not focus so much on the nominal price. What matters is the market cap. If GOOG does a reverse split and its stock goes from $100 to $1000 that doesn’t meant it’s expensive. It’s only the market cap that tells you that. And bitcoin’s market cap is still two orders of magnitude smaller than gold’s
I was sceptical of cc and particularly bc for years and it was rational to be so.
But as time has passed we see more and more integration of this new technology within the general machinery of commerce. In my mind the two issues initially facing bc was (1) the reliability of the technology and (2) regulatory hurdles.
The first reported transaction of bc was for a pizza in London in 2010. The pizza was purchased for 10,000 bc which today would have a value of roughly 2.4 million dollars.
During early 2011 a major flaw was uncovered in the algorithm that was corrected. Since that time there have been no further flaws encountered in the technology.
Now we see that bc (and cc) has become an integral feature of internet commerce. This means it is global and pervasive. We also see that governments, particularly those on the vanguard of the digital age, have established regulations for it with respect to exchange and taxation. One of the largest owners of bitcoin is the FBI, with about 150,000 of them.
How big can this market get? Right now cc is has just reached 100 billion dollars. When we consider that cc is actually superior to credit cards with respect to security and transaction cost, we can get some idea as to the potential market size.
Very roughly, card transactions are around 3.5 trillion dollars annually and are growing. We now see that cc can is an alternative that is superior for online transactions. Just on this metric cc is still in its infancy.
You may argue that cc is based upon credit and that the so called ‘credit’ card is based upon debt. This is true but there is nothing to stop someone from from buying cc with debt, as long as they can get someone to issue it to them.
Therefore I have changed my mind with respect to cc. I believe that it is here to stay. I also believe that, within the digital economy, it exhibits very similar features to gold and is superior to it. Within the physical world gold remains superior.
This bifurcation between digital and physical is difficult to comprehend for many. But it is the new reality of our age, and those who do not embrace it will suffer the consequences. The new cc has become the transaction interface between the digital and physical worlds.
The technology is here to stay without a doubt.
Whether Bitcoin itself remains king of the technology is what is in doubt
That is an excellent point Mish. My thinking is that bc de facto underpins all other cc. This makes straightforward the regulation and transaction of any others as they are generally expressed in terms of bc:
https://coinmarketcap.com/
My concern is the survival of various ‘altcoins’, not the bitcoin – this is where there is greatest risk. As an investment, cc is not for the faint hearted, however. No doubt Goldman is working on some sort of volatility index as we write.
How long before governments wise up, create their own crypto currencies being able to track and tax every transacion, and declare that all other crypto currency transactions are illegal?
In a sense this is already the case – as US dollars, for example, are 97% digital already.
But there is no need for a government to create a new cc and doing so could undermine a national currency. For the USA, it could destroy the digital dollar. Further, as long as the exchanges are controlled and regulated by government there is no need to create alternatives anyway.
The main benefit of creating your own cc is that the first few million or so are easily mined. Satoishi Nakamoto (the alleged inventor) easily created around 1 million bc initially (now worth $2.4 billion). Currently there are 16.3 million bc and today extreme computing power is required just to create a handful – the energy cost required is prohibitive for most people.
Nonetheless, John McAfee Global Technologies claim that they are generating an income of about $300K per quarter mining cc and are expanding this capability.
Maybe I’m wrong, but it appears as though the vast majority of crypto currency exchanges are for illicit purposes. How long will it be before governments step in?
BTC is definitely not superior to credit cards when it comes to online purchases. Recently fees for a transaction have been very high. (https://coingeek.com/recommended-bitcoin-fees-cross-3-per-transaction/) Plus each block takes about 10 minutes. Most places require a 2-3 confirmations (to avoid double spends) which means 20-30 minutes. Imagine buying a song online and needing to wait 20 minutes before you download it. Very fast compared to purchasing music in the 1980s, but snail-slow compared to the present. Other cryptos (which in some or many ways are functionally superior to BTC) could gain widespread adoption but I don’t see BTC doing it.
Excellent point John, thank you. Which cc do you think could gain widespread adoption?
Given BC’s success, what’s to prevent a million imitations? Won’t federal governments want a piece of this action? Can’t do that with gold. Just sayin’.
China could easily outlaw Bitcoin.
I do expect the governments to mandate their own digital currencies.
There already are hundreds, if not thousands, of crypto currrencies, but Bitcoin is the most popular by far. There’s even a currency called the Sh*t Coin — I kid you not.
It’s never too late to be taken. Every bubble has taught that to some. Others, presumably learned to sell while the price is high. How can I short bitcoin? No ETF (yet.)
_aleph_
Isn’t Jim Cramer the guy who uses sound effects, lots of screaming, and flashing lights to “entertain” the CNBC masses?
And isn’t Jim Cramer the guy who (in his own words) “blew it” in 2008 and had to go do a silly apology tour on the Daily Show?
And now he is doing the same sound effects, flashing lights, screaming and telling his ministry faithful that prices can only go up?
So is has he reserved time yet on another extreme-left media program to apologize for this repeat performance?
Don’t be silly, Bear Stearns is fine!
“At some point people will realize this is just tulip mania, as it is with Bitcon. Yes, there are a deflating number of Bitcoins but there are an infinite number of real and potential digital currencies!” – Karl Denninger
Note that his spelling of Bitcoin as “Bitcon” was intentional.
The 6 Most Important Cryptocurrencies Other Than Bitcoin
http://www.investopedia.com/tech/6-most-important-cryptocurrencies-other-bitcoin/
Right now, there are major shortages of the more powerful AMD graphics cards because they are better than Nvidia cards for cryptocurrency (CC) mining and CC mining has once again become profitable for reasonably priced personal PCs built for that purpose because of new software and new CC startups. Generation of CC “coins” from thin air (crypto-pseudo-Fed? sounds like a medication) is MUCH easier at the start of a new CC than later.
Since the best way to get insanely rich as the UNKNOWN creator of Bitcoin undoubtedly must be since at the start of a new CC the generation of coins is computationally undemanding (there are several stories of very early adapters and miners losing many millions of dollars each worth of Bitcoins because they threw away a laptop or hard drive which had their password and wallet on it) is to start a new CC, you can expect many more of them to appear over time at which point the value of Bitcoins will decline as the choices and number of CC “coins” available increase.
“adapters” = “adopters.”
I wish WordPress would adopt the revolutionary -ANCIENT- capability called “editing”.
Maybe we should simply be thinking total crypto value as share of currency market, not btc vs. other etc.?
Many are saying USFedCoin, backed by the state’s ability to freeze your entire life is only a few years away. That’s confidence you can believe in.
USFedCoin already exists in the form of digital dollars, about 97% of all US dollars currently in circulation. USGov can already freeze one’s entire life simply by applying civil asset forfeiture combined with RICO regulations. If this isn’t enough one can be put on no-fly and no-work lists. There are probably hundreds of other ways that the USGov can put one under Kafka-esk house arrest.
I’m ignorant of this among many other things. 2 questions come to mind.
1) Could crypto currencies be a method to get money across borders? For instance out of trade embargoed countries or out of places with some capital controls, China etc. That might account for some demand beyond pure speculation.
2) Is it seen as a method to reduce the need for gold if the gold price takes off on demand? Another diversified.
I don’t trust anything in the Cloud and it makes me nervous to think it exists in the ether only.
“Could crypto currencies be a method to get money across borders?”
Since CCs are reportedly used routinely in “Deep Web” criminal transactions, I don’t see why not.
“I don’t trust anything in the Cloud”
I don’t either, but I believe CCs are inherently secure because they were specifically designed from the start to be so, whereas most of what is done on-line which has simply evolved over time. However, if via something like a keystroke logger your Bitcoin account is compromised, you are screwed. There is obviously no fraud protection as there is with credit cards and bank accounts.
“Deep Web” should have been “Dark Web”. Deep Web is:
The deep web,[1] invisible web,[2] or hidden web[3] are parts of the World Wide Web whose contents are not indexed by standard search engines for any reason. The content is hidden behind HTML forms.[4] [5] The opposite term to the deep web is the surface web. The deep web includes many very common uses such as web mail and online banking but also paid for services with a paywall such as video on demand, and many more. Computer scientist Michael K. Bergman is credited with coining the term deep web in 2001 as a search indexing term.[6]
So Conservatives lost their majority if exit poll correct? Not getting a clear description anywhere at present.
Had experience of 3 polling stations today via my own vote and family members. All very, very busy.
I have on my screen by exit poll Conservative under 50% at 314 down from 331.
?
Exit polls were way off in 2015 also. Zerohedge has a nice breakdown.
Thanks.
I’ve read a few anecdotes in how bitcoin was used to keep a family in Venezuela from suffering miserably, b/c one of tgem could use bitcoin as a placeholder if value that could move over borders and buy goods outside the country via the internet. It already is a means to move money. Plus, the block chain technology (ex. Etherium) is bring used for things like riding dicuments on the transaction tokens as an extra layer of trust/verification.
I think it would take the angel of death killing the firstborn worldwide to stop the further implementation of block chain tech.
Btw- Clif High is a good source if crypto info. He’s fairly well read, (but just one source.)
Sure can! That’s what’s happening in Venezuela, people are buying goods on Amazon by using bitcoin to purchase Amazon gift cards. Then they have someone they know bring the purchases across the boarder for them.
I was looking at buying bitcoin ATMs a few years ago. The idea was to put them in areas frequented by immigrants so they could transfer money back home without needing to go through Western Union. But it would have been very difficult to do because of all the money laundering laws that basically require you to investigate your customers and snitch on them to Uncle Sam.
1. Yes. Bitcoin and other cryptos enable the easy transfer of wealth across borders.
2. Gold is an old form of money. Fiat is a very new and different form of money. Bitcoin is the newest form of money that differs greatly from fiat and in important ways is more like gold. Bitcoin can be viewed as competing with gold (and other assets) as a store of wealth. It is more useful than gold as a medium of exchange, but it is not quite ready to compete successfully with fiat-based retail payment systems.
If you’d like to learn more about bitcoin, this playlist of videos would be a good start: https://www.youtube.com/playlist?list=PLDto3IHr_v57h3FFYlLN3-3_J9H8lMFaH
Roughly, global narrow money would have to cede half its value for bitcoin to take its place at 1 mn. There are @ 20 mn btc. If btc replaces derivatives etc. somehow, then the effect is less. So really it is question of what role btc plays, how it gets tied up into contract, if it becomes legal tender, and so forth. I won’t guess.
http://money.visualcapitalist.com/all-of-the-worlds-money-and-markets-in-one-visualization/
The Bitcoin craze is a Tulip Mania. See my post above.
Expect any number of new cryptocurrencies with time. The potential number of them is unlimited and there is a great potential payback for anyone who starts a new one.
With digital currencies, it’s just as easy to use one as it is another and as each new cryptocurrency gains acceptance and widespread use multiple payment options will be allowed by concerns who accept them. Thus, the value of of any single cryptocurrency unit of exchange will decrease over time.
It’s only when the demand for a cryptocurrency unit of exchange exceeds the supply that its value increases, but only temporarily since new cryptocurrencies will crop up to supply the demand.
Since the generation of new cryptocurrency coins gets far more difficult and expensive with time and the number of coins generated within a particular cryptocurrency implementation, what we are seeing with Bitcoin is a rapid rise in demand for them which is impossible to supply economically via the generation of additional Bitcoins.
I agree that is well possible or likely, btc might lose some value or not gain as much, total crypto currency value might increase, but credibility as store of value might dissapear once it is realised that the total volume of crypto currency is limitless. I can think of counter theory – for example btc gets mandated as global currency after volatility etc., but would take a good stretch of imagination to believe that is what will likely or definitely happen.
Not only is the number of cryptocurrencis unlimited but there’s nothing stopping the next ones from calling themselves Bitcoin to confuse the hell out of the market. 30 new “Bitcoin” (or even just Bitcoin Lite, Bitcoin Plus, Bitcoin2, Bitcoin3, etc) would just about do it.
Nothing to stop Parker Bros from naming their monopoly money “dollars” either, confusing people.
Any currency needs to be used in trade to have much purpose. Silly speculation is just that: Silly. And ultimately pointless, despite what the banksters have suckered the easily so into believing, over the 4 decades since Nixon put the final bullet in Western once-were-civilization. BTC has enough momentum, and the currently most used national currencies are so insanely mismanaged, that it just might jump the rubicon and become widely used.
If that does not happen, it will be due to lack of the anonymity it was initially thought to facilitate, but which has since proven to be at best a truth with some serious modifications; as well as the more technical problem of having a verification process that is too amendable to centralization. But if that turns out to be the case, there are well founded alternative currencies that does a good job of solving those two issues. One way or the other, people will respond to the ever more flagrant debasement theft and surveillance their overlords have decided to subject them to, by transitioning activity to venues making them less vulnerable.
If Jim Cramer is recommending you buy it, its definitely too late!
I saw a study somewhere on-line that proved that it was actually better to flip a coin on any topic than to take his advice.
The Government seems to be strangely silent on Bitcoin.
I would not be at all surprised if suddenly the Government becomes VERY interested in everyone who has made “huge profits” in Bitcoin and these people get a very unwelcome notice from the IRS that they owe a fortune in unpaid capital gains taxes, late fees, fines and interest.
Hell, no one even knows who started Bitcoin, that person undoubtedly now being insanely wealthy in Bitcoins, so I don’t see much chance of that happening as long as all of the profits made were kept in Bitcoins and all transactions were made using Bitcoins or other cryptocurrencies. That is one of the many reasons why governments truly hate cryptocurrencies.
I can see them getting a clue about a person’s cryptocurrency wealth by requiring merchants who accept them to report the transactions along with the persons making them.
Since the vast, vast majority of merchants do not accept payment in Bitcoin, then most peoples’ Bitcoin profits are essentially “paper profits” – trapped in Bitcoin. If they ever attempted to convert these profits to legal tender, they suddenly become visible to the IRS. This does not sound very appealing to me.
Already happening. Any meaningful sell of bitcoin already drops the price considerably. Liquidating $1 million worth would collapse it right now.
Not likely. In 2014, when bitcoin’s market cap was less than $5 billion, someone sold $9 million worth of bitcoin on a popular exchange using a single limit sell-order set a little below the prevailing market price. You can see what happened here: https://www.youtube.com/watch?v=-uX_bB_4VJk
Bitcoin’s market cap is currently more than $46 billion.
There is a reason bitcoin’s unofficial mascot is the honey badger: https://www.youtube.com/watch?v=kb6bWsa_LdQ
Know your customer compliance:
https://blog.identitymindglobal.com/general/customer-transaction-monitoring-bitcoin-exchanges-identitymind-bitcoins
KYC, or “Know Your Customer,” refers to the due diligence financial institutions are required to perform on their customers as an aspect of doing business. In order to comply with federal regulations surrounding financial fraud, money laundering, identity theft, and terror financing, Bitcoin companies are required to verify their customers by instituting policies on customer acceptance and transactions.
Now anyone want to bet the companies that are exchanging amazon gift cards for bitcoin are running background checks on their customers? I know when I sold mine last year I had to identify myself to the business I sold them to, so there’s some record of that transaction. But KYC only applies to the US and some other first world countries. Will that guy working through a go-between in Venezuela get away with laundering bitcoin? Or has someone already figured out a way to randomize and anonymise wallets to remove any connection between dirty money and clean? Time will tell.
They said all they needed to say a few years ago when the treasury decreed it an investment not a currency. So it falls under all the screwy laws that cover gold trades, including being subject to capital gains, Know Your Customer anti-fraud checks, etc.
Since there’s such a big gain going on and a largely untraceable market I would imagine a smart IRS administrator would be working on a mass audit this year.
Seems like a glorified Ponzi scheme to me…When the mad dash to sell commences, who will buy on a crashing trajectory… On the other hand, with the currency mess in India, and the Chinese trying to offshore wealth, one just might become a digital magnate…
When Mish becomes interested, I will sell.
Looks Like you will be passing Bitcoin on to your kids.
Mish
Love your work and I have learned a lot from you. No one is right all the time.
Do Not sell when Mish gets interested. He will get in Next year sometime when both BTC & ETH are thousands higher in price and market cap. This cryptos is a revolutionary technology even as was the internet when it came out. But the cryptos are at the point now that over the next 3 years they are going to explode in value as to their manifold use in both commerce and finance become known and utilized. Many smart people like Mish simply have Not done their homework as only less than 1% are aware of future usage and necessity that BTC & ETH will impact on the world. With over a Quadrillion or 2 in world digital currency debt (all currencies are today transacted digitally) today and that dinosaur is in its death throws – The cryptos will be the recipients of the new paradigm wealth transfer.
Mish, I plan on passing some BTC (and the like) on to my kids…I think it will be a substantial part of my wealth.
As I said above, I bought a few bitcoin from an ATM and some individuals back in 2013 just to find out what it was about, and to see if there was a business that could be started around BTC. Right after I bought the price started dropping in a big way. But I was more disappointed by the fact that I was basically stuck with them. All the businesses that said they take BTC either quit or didn’t bother to tell their front line employees about it. Since they weren’t really a big investment I just held on to them until last spring when the price started to rise and I ended up doubling my money. Good times. Of course if I had held I would have had a 10X or so return, but I still wouldn’t be too bullish on BTC. It’s supposed to be a currency, not an investment. Currencies aren’t supposed to fluctuate like a stock they’re supposed to be a benchmark so you can determine the value of a good or service.
The price volatility of BTC, combined with the need to pay expenses in a Fiat, necessitates immediate exchange for Fiat for most traditional businesses that accept BTC; rendering it’s usage somewhat contrived. You’re basically quoted a BTC price that is just an instantaneous exchange rate multipler of the Fiat most of the vendor’s expenses are in.
Not sure if some of the “ilicit” sectors it is popular in, have longer BTC-native value-add chains, such that holding it is viable and valuable for participants. But until such chains emerge in some sectors, BTC does remain kind of trapped.
I find it disconcerting that bitcoin is attracting this type of uninformed media attention at a time when a power struggle among bitcoin network participants could have disruptive consequences. I don’t know whether to sell some of my BTC stack due to fundamental concerns, or buy more in anticipation of a new wave of dumb money.
If the “invisible hand” helps guide bitcoin to a positive resolution of the current power struggle, then I do believe it could reach a price in the hundreds of thousands of dollars within a decade or two (with speculative bubbles and crashes along the way). I think it could achieve this primarily by serving as a store of value and taking market share away from gold, stocks, and other investments; I do not believe hyperinflation of the USD is a requirement.
If you’d like to learn about bitcoin, this playlist of videos would be a good start: https://www.youtube.com/playlist?list=PLDto3IHr_v57h3FFYlLN3-3_J9H8lMFaH
If you’d like to learn about the current power struggle in the bitcoin community, here’s a post with some helpful info and links: https://www.reddit.com/r/BitcoinMarkets/comments/6fz8f2/asicboost_segwit_and_uasf/?ref=share&ref_source=link It will be difficult to understand if you are not already familiar with bitcoin.
Bit coin is only one of dozens of digital currencies being exchanged via various markets – google “bitcoin exchange volumes” or check https://coinmarketcap.com/exchanges/volume/24-hour/
While bitcoin has a some limited acceptance as a payment method most of these so called crypto-currencies do not – ergo they are being used for pure speculation at best and nefarious money movement at worst.
On the highest volume exchange the total exchange of bitcoin in a twenty-four hour period was in the millions of dollars – this is a very shallow market compared to the more traditional forex markets which move billions and trillions in the same period. It is ripe for manipulation with effectively chump change by any big player. Does anyone here think the likes of JPM or Deutsche Bank would leave something with the potential to move 100% untouched? And once someone that big decides to play they can control such a shallow market with traditional pump and dump moves – fleecing the sheep every cycle. The recent drop and rebound was driven via volumes small enough that a few coordinated traders could rig it without hitting the radar.
For those that got in early congratulations! Or at least congratulations IF you actually realize profits in any sort of wealth that means anything. For those who are just deciding to get in, say BBAAA!
Blockchain is revolutionary, Bitcoin is onions currently believed to be tulips.
Even if one of these crypto-currencies eventually becomes something approaching accepted as any common fiat currency, it is a gamble that it will be bitcoin – a gamble that will in fact be determined by the same powers that be that control everything else, and it will only happen if it is to their benefit.
Indeed. Blockchain is perfect for some applications.
Bitcoin itself may not even survive
When the internet bubble burst in 2000, lots of high flying internet stocks/businesses crashed and burned. Was that the end of the internet? I expect a lot of smaller cryptocurrencies and crypto-related stocks/businesses to similarly crash and burn,
Bitcoin’s leadership position could possibly be lost to one or more other cryptocurrencies. However, bitcoin and cryptocurrencies are likely to be around as long as the internet. I think it would be wise to learn more about bitcoin.
Bitcoin is revolutionary. Blockchain is a slow database.
Distributed blockchains with competitive verification are, or at least can be if properly constituted, very very resilient databases. Even if not particularly fast. And when the NSA/CIA/KGB/FBI…., cheered on by 99% of a well indoctrinated mass of uncritical sycophants babbling about nonsense like “democratically elected,” wants to shut you down, resilience is what matters.
While, as the internet is increasingly demonstrating, speed just kills. Ultimately all those in thrall to it.
The bitcoin blockchain is resilient because it is decentralized and open. People who praise “blockchain technology” usually want to use it to centralized and closed systems.
In that case, you’re certainly right it is no more than a slow database…
Pretty much the entire purpose of a bitcoin style blockchain, is that open competition for verification, renders it resilient against being “taken over” by any subgroup of actors.
Of course, in a world where Newspeak trumps reality any day, the word “blockchain” sounding “cool” to idiots with influence, probably just means everything is now a blockchain. Kind of like how everything is now “artificial intelligence” to those not endowed with much of the non artificial kind. After all, that just depends on what the meaning of is, is.
Is the boo-yah boy still around?
Years ago I followed his advice and bought some Motorola shares. I lost my shirt. I never watched his clown act again.
I’m amazed he still has a following.
But you have to give the guy credit, He’s got a good line of BS. That’s what draws all the suckers in. And yeah, I was one of them.
Yes this is the first time in years I’ve seen anyone quote Cramer. He says a lot of silly things.
However I am surprised Mish has not picked up on the fact that the cryptocurrencies are a tool of trade that no central bank can manipulate the price of.
You’d think it would be something he would champion.
Does it replace gold? Of course not. But gold and paper currencies co-exist. Along with cryptocurrencies.
£€$¥ thanks for the insight
Agreed, wish I took the insurance for $1000.00 but still will not since without backup it’s Fiat currency. Fool me once, shame on you. Fool me twice, shame on me but I’m not going to engage in that game cause I can’t take the loss any more. I can live peacefully with the investments I have now.
Please put Craemer out of our misery.
No, it’s not. Fiat’s definition: “a command or act of will that creates something without or as if without further effort ”
There is no command or central power in bitcoin. It’s inherently un-fiat. There’s a cap on the number of bitcoins that will ever be mined…You can’t say that about the USD.
Blodget really knows how to stick his neck out – a million or zero? And Cramer is a good entertainer; but don’t follow his advice. I think Bitcoin is gaining credibility; it looks like better insurance than gold at this point. Maybe a currency not under government control (politician) does make sense and could be workable.
I was just trying to find an address for Gdax, the biggest trader of Bitcoin, whose recent 30 day volume is 1.3 billion dollars, and is currently trading $75 million a day.
https://bitcoincharts.com/markets/currency/USD.html
According to their FAQ they are FDIC insured up to $250,000 per account and the exchange is regulated. Actually, your funds are segregated to a US bank and thereby your funds are insured through your bank, which would mean insured if the bank went insolvent. Coins held by Gdax/Coinbase they say are insured by Lloyd’s of London.
They offer a recruitment bonus for referring new users.
Their address is a box number for (parent?) CoinBase, at Coinbase Customer Support, 548 Market Street, #23008, San Francisco, CA 94104. Looking at streetview for Feb 2017, the address, which was for Earth Class Mail, a virtual mail cloud service (‘choose any address you want’), has brown paper on the windows and what seems to be a homeless guy sitting out front; it seems to be vacant. August 2016 548 Market St seems open for business with an Earth Class Mail sign out front. I guess ECM has moved; they now have a box number address nearby (with no street address, just a zip code, but they also still show 548 Market St on their website, the apparently closed address), so a box number for ECM which holds a box number for Coinbase which is Gdax. Gdax don’t accept calls or even give a phone number because they according to the FAQ they ‘love to communicate with users’ on Twitter and Facebook for customer service.
I don’t feel that comfortable with a rather opaque identity for an FDIC insured instituion. It would be nice to be able to knock on the door of an office that you’ve been given the address and where you could meet people face-to-face.
If someone could offer other information than this, it would be helpful for my better understanding.