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| In December 2017, bitcoin prices hit a record high of just under $20,000. Flash forward to December 2018 and bitcoin is now trading a little below $3,400. That's a more than 80% plunge. Bitcoin is at a 15-month low. But prices have really gotten whacked this week, falling nearly 20% in just the past five days alone. Aslam argued that bitcoin prices could wind up plummeting below $2,000 and even test the $1,500 level. "Simply put, the bad news keeps coming just like cockroaches coming out of a hole," Aslam wrote in a report. |
I am sure there are a ton of people who cashed in and made some nice bank, but good lord, the FOMO crowd really got taken to the cleaners.
Russia actually used their version of Bitcoin to avoid sanctions on them, because it is anonymous in nature. Check the link out.
RUSSIA WILL CREATE ITS OWN BITCOIN TO AVOID U.S. SANCTIONS: REPORT - ( New Window )
everyone trashes IBM and rightfully so, they suck, but they are still at the forefront of innovation.
Check out the linked youtube about the Food Trust. We just had a major issue with Romaine lettuce, the Food Trust will allow you to track food origin in 2.2 seconds. Plus there are many other benefits that will undoubtedly be highly valuable in emerging markets and the ability to feed populations.
this is going to be adopted as the standard and similar uses (like BBDTS mentioned) are coming rapidly in many different industries.
IMO bitcoin is only or mainly useful for black market transactions because "know your customer" regulations for real market transactions in most Western countries prevent the anonymity which is the major attraction of bitcoin IMO. So, I'd never invest in a crypto currency, but blockchain is absolutely real, and not penny stock like or tulip bulbs (though bitcoin probably is).
IBM Blockchain powers the Food Trust - ( New Window )
Very true.
The record keeping potential is incredible.
Being able to see the entire life of your apple, down to what day it was picked and from where, to what it’s transit was like, when it was placed in the grocery store, etc will be quite crazy.
it would cost more to mine new coin than it is currently worth
if less people are mining coins .. how can blockchain keep going?
there won't be enough computer power and blockchain will slow to a crawl
making bitcoin unusable
But a lot of people made a whole lot of money because they knew when to buy it and when to sell it. The sanctimony has been a bit much here. Lot's of money was made from people who know how to make it. And for the record, I don't own any now and never have.
What has always puzzled me is that Bitcoin is a currency, not a financial instrument. You can "invest" in it the way you would "invest" in any other currency, trying to make some dollars off fluctuations in the exchange rate. But when any currency's exchange rates are this volatile, something's not right.
That said, it could go down, it could go up. It’s bitcoin...
I know there are certain entities (governments, for example) that want to eliminate cash transactions, particularly over a certain amount. I still view cash as the only truly anonymous currency, and think we're being over-sold on the anonymity of blockchain/bitcoin for not altogether innocent purposes.
Am I wrong?
What has always puzzled me is that Bitcoin is a currency, not a financial instrument. You can "invest" in it the way you would "invest" in any other currency, trying to make some dollars off fluctuations in the exchange rate. But when any currency's exchange rates are this volatile, something's not right.
Bitcoin is not a currency. It’s creator may have intended it to be, but it doesn’t function anythng like one.
It’s not a financial instrument either. Bitcoin is a commodity.
I know there are certain entities (governments, for example) that want to eliminate cash transactions, particularly over a certain amount. I still view cash as the only truly anonymous currency, and think we're being over-sold on the anonymity of blockchain/bitcoin for not altogether innocent purposes.
Am I wrong?
That’s exactly right. Every transaction since Bitcoin’s creation appears in its ledger. There are no names listed in the ledger, just Bitcoin addresses (functionionally your account number). If you can tie a person to the address, you know every transaction they’ve ever made. And with data forensics, it’s easier than you might think. Prosecutors have tied people to crimes via the Bitcoin ledger.
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the concept that you can be anonymous seems right, but if anyone ever identified you the ledger would reveal every single transaction you've ever made, right? Am I misunderstanding?
I know there are certain entities (governments, for example) that want to eliminate cash transactions, particularly over a certain amount. I still view cash as the only truly anonymous currency, and think we're being over-sold on the anonymity of blockchain/bitcoin for not altogether innocent purposes.
Am I wrong?
That’s exactly right. Every transaction since Bitcoin’s creation appears in its ledger. There are no names listed in the ledger, just Bitcoin addresses (functionionally your account number). If you can tie a person to the address, you know every transaction they’ve ever made. And with data forensics, it’s easier than you might think. Prosecutors have tied people to crimes via the Bitcoin ledger.
Your describing blockchain more then the coin itself.
Easiest way to think of it is it’s a google doc that we are all working on. If you ever have done this you’ll see the anynoumous posters that are on there at the same time. Blockchain just takes it a step further to show you who did what to the document and in what order and time.
It could literally go to $0.
Russia actually used their version of Bitcoin to avoid sanctions on them, because it is anonymous in nature. Check the link out. RUSSIA WILL CREATE ITS OWN BITCOIN TO AVOID U.S. SANCTIONS: REPORT - ( New Window )
Or Tiny Tim’s classic song from the 60’s...
I asked him whether traffic was down in conjunction with the plunge in bitcoins' (all of the iterations) prices, which was beginning to pick up speed back then. And he said, quite the contrary, customer payments transaction traffic was increasing smartly.
That brings me to Jim in Fairfax' comment:
It’s not a financial instrument either. Bitcoin is a commodity.
I asked him whether traffic was down in conjunction with the plunge in bitcoins' (all of the iterations) prices, which was beginning to pick up speed back then. And he said, quite the contrary, customer payments transaction traffic was increasing smartly.
That brings me to Jim in Fairfax' comment:
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Bitcoin is not a currency. It’s creator may have intended it to be, but it doesn’t function anythng like one.
It’s not a financial instrument either. Bitcoin is a commodity.
In light of this anecdote, could you flesh out your comment if in fact people are using bitcoins to effect payments. Maybe bitcoin has dual or multiple characteristics? And I'm not referring here to blockchain, whose enabling/tracking technology for bitcoin I think I understand (a little).
Bitcoin is not a company and thus does not have offices. I would surmise from your anecdote that the gentleman in your story runs a cryptocurrency exchange. People give him dollars and he gives them Bitcoin, or vice versa.
As an alternative anecdote, I present you with a used car dealer. He accepts dollars in exchange for used cars and vice versa. Would you say that makes used cars a currency?
There are three core qualities of a currency: it functions as a medium of exchange, a unit of account, and a store of value. Bitcoin is bad at all of these. It is accepted at few places and is cumbersome to exchange where it is accepted. Nobody uses it as a unit of account - nobody prices products and assets in bitcoin; rather prices are quoted in dollars and converted to the bitcoin value of the moment. Until a year ago you might have made an argument bitcoin was a store of value. Tell that to people that bought last year and are still holding it.
Bitcoin is not a company and thus does not have offices. I would surmise from your anecdote that the gentleman in your story runs a cryptocurrency exchange. People give him dollars and he gives them Bitcoin, or vice versa.
As an alternative anecdote, I present you with a used car dealer. He accepts dollars in exchange for used cars and vice versa. Would you say that makes used cars a currency?
There are three core qualities of a currency: it functions as a medium of exchange, a unit of account, and a store of value. Bitcoin is bad at all of these. It is accepted at few places and is cumbersome to exchange where it is accepted. Nobody uses it as a unit of account - nobody prices products and assets in bitcoin; rather prices are quoted in dollars and converted to the bitcoin value of the moment. Until a year ago you might have made an argument bitcoin was a store of value. Tell that to people that bought last year and are still holding it.
Well, to your anecdote, for sure the used car is a store of value, even as such value fluctuates, and certainly b/c is a unit of exchange, and to say b/c is bad at the three elements of currency (good marker) does not disqualify it as such. That its places of acceptance/adoption are not universal, does that simply reflect the state of the adoption rate? And as to unit of account, I'm don't know the answer to this but suspect that blockchain may have a function here.
I'm not arguing for or against the merits of b/c (have never invested in the mania); my question went to trying to understand your blanket statement in your post prior to the one to which I'm responding.
I have a few bitcoins that I mined very early on. As in, when people were mining them because you could buy a pizza with them (plural). The effort to do the mining wasn't that intensive, and at the time I had access to a blade farm with spare cycles, so it was found money.
The belief was that stores - mostly online, though some physical - would begin accepting bitcoin as currency. For the most part, they haven't, and the majority of bitcoin transactions is in an online realm that's best described as shady (if not outright dark). That lack of legitimacy has completely undermined the thought that these things would take off, IMO.
I sold most of what I had - didn't find the peak, but wasn't far off. At first I was kicking myself because they made a good run after, and now I'm stuck wondering whether I should have sold them all or if they might make another baseless hype filled run upward. They cost me nothing, which is something I still can't get over when I think about the intrinsic value of these things (plenty of people who hold them got in at pennies as well).
I did come up with a way to do litecoin though that I thought might be profitable, but by that time I'd lost any even speculative hope for this incarnation of cryptos. Add to that lack of hope the fact that cryptos are not regulated, not backed by any FDIC, and there is no standard, they're even more speculative than penny stocks or tulip bulbs. Didn't mean people can't or didn't make money on them, but that also doesn't make them a good investment.
I felt like big banking wouldn't let the cryptos happen and to reiterate the main draw of the crypto currencies is anonymity and that clashes with most western civilization commercial transaction regulations.
but I did see real value in the recording and distribution of the transaction components, like many tech firms did, hence the onslaught of buzz about the blockchain without the cryptocurrency. The time it takes to have a transaction recorded has gone (or can go) from days or longer in some cases even today, to seconds.
I do believe that can revolutionize the way we live and transact business not to seem too cliched, and some of it is happening now as referenced above. People skeptical about this concept should google search blockchain or blockchain without bitcoin and look for a basic introduction to blockchain and then expand from there.
There are many ways to invest in blockchain that are far less risky than bitcoin yet still contain upside (though probably not quite as much, but obviously less downside)
Well, to your anecdote, for sure the used car is a store of value, even as such value fluctuates, and certainly b/c is a unit of exchange, and to say b/c is bad at the three elements of currency (good marker) does not disqualify it as such. That its places of acceptance/adoption are not universal, does that simply reflect the state of the adoption rate? And as to unit of account, I'm don't know the answer to this but suspect that blockchain may have a function here.
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Economists refer to unit of account as something that is used as a common representation of value of good, services, etc. Nobody uses Bitcoin in this manner. Even merchants that accept Bitcoin do not list prices in Bitcoin. Rather they list them in dollars, and you’re charged the current dollar equivalent in bitcoin.
In fact, practically no merchant that accepts Bitcoin as payment is really doing so on an intrinsic level. They don’t want your bitcoin - they don’t deposit it in their company bitcoin account. Rather, the transaction is processed via an online Bitcoin exchange who immediately provides the merchant with dollars. And you pay a transaction fee to the exchange for that service, which you wouldn’t have been charged if you’d paid in dollars.
Amazingly, they've been really silent. I wonder if there isn't any Internet connection in the cardboard box.
Then there is this interesting statement:
Any yet are not Sweden and I think India (which sits astride E & W) pushing toward 'cashless' transaction mediums of exchange? Can that co-exist with anonymity? Does blockchain render that unlikely or impossible? Like the misnomer of one's private, personal Facebook data?
What did I say that would lead you to believe bitcoin would rise in value?