2017

“Bitcoin Is an Implausible Currency” – Bloomberg | $15,516.42

By Alexander Reed

Last Updated: Dec 26, 2024

bitcoin obituary

Bitcoin has real advantages over gold if you are, say, attempting to get your money out of a country with strict limits on shipping currency abroad. It’s a lot easier to hide a USB drive than a truck full of gold bullion, or even a foreign bank account stuffed with smuggled cash.

But bitcoin has real disadvantages, too: A USB drive is easier to steal, or lose, than a truck full of gold bullion. Moreover, gold does have actual uses: It is pretty to look at, and it also has some industrial applications, which means its value will never fall to zero, as bitcoin’s might. And bitcoin is a good bit more volatile than gold, which means that you could suddenly discover that your carefully smuggled savings are worth very little when you need them. Even if “when you need them” is “next week.”

Perhaps the biggest weakness, however, is that if bitcoin really turns out to be a good way to keep governments from controlling their economies and their citizenry, then governments will crush it.

So when I ask “What is bitcoin good for?” the answer I come up with is “not enough to justify anything like these valuations.” There are all sorts of interesting applications for cryptocurrencies and blockchains. But unless they become a global currency, or a global payment system, I don’t see why, 50 years from now, anyone is going to be willing to pay tens of thousands of dollars to get their hands on one.

Eulogy made by Megan McArdle

Source

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Crypto is a high-risk asset class. This article is provided for informational purposes and does not constitute investment advice. You could lose all of your capital.
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Alexander Reed
Alexander Reed
Editor

Having delved into futures trading in the past, my intrigue in financial, economic, and political affairs eventually led me to a striking realization: the current debt-based fiat system is fundamentally flawed. This revelation prompted me to explore alternative avenues, including... Read More

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