Vitalik Buterin Has Suggestions for Dogecoin and Doge’s Cooperation With Ethereum Altcoins Bitcoin News – Bitcoin News

Ethereum co-founder Vitalik Buterin has some suggestions of what he personally would like to see happening with Dogecoin and the meme cryptocurrencys cooperation with Ethereum.

Ethereum co-founder Vitalik Buterin shared his thoughts on the potential cooperation between Dogecoin and Ethereum Wednesday as part of a Twitter experiment he is conducting where only the 268 people he followed can ask him questions.

Three Arrows Capital CEO Zhu Su asked: What are some promising ideas for Ethereum / Doge cooperation? What was it about Doge that got you interested in the project? Su recently said that he is very bullish on dogecoin and that the meme cryptocurrency has no risk of it having any regulatory issues ever.

Referencing Proof-of-Stake (PoS) and Proof-of-Work (PoW), Buterin replied to Su:

Personally, I hope that doge can switch to PoS soon, perhaps using Ethereum code. I also hope they dont cancel the 5b/year annual PoW issuance, instead they put it in some kind of DAO that funds global public goods. Would fit well with dogecoins non-greedy wholesome ethos.

In June, Buterin also talked about potential cooperation between Ethereum and Dogecoin. If Doge wants to somehow bridge to Ethereum, and then people can trade DOGE thousands of times a second inside of loopring, then that would be amazing, the Ethereum co-founder opined. I think if we can have a secure Doge-to-Ethereum bridge. That would be amazing, and then when Ethereum gets any scalability that works for Ethereum assets, you would be able to trade wrapped DOGE with very low transaction fees and very high speed as well, he further said.

In August, the Dogecoin Foundation relaunched with Buterin as one of its board advisors, along with Jared Birchall, a close associate of Tesla CEO Elon Musk, another prominent dogecoin supporter.

Among numerous questions Buterin received as part of his Twitter experiment was whether he was likely to create another cryptocurrency. The Ethereum co-founder simply responded with No.

What do you think about Vitalik Buterins suggestions for Dogecoin? Let us know in the comments section below.

Image Credits: Shutterstock, Pixabay, Wiki Commons

Disclaimer: This article is for informational purposes only. It is not a direct offer or solicitation of an offer to buy or sell, or a recommendation or endorsement of any products, services, or companies. Bitcoin.com does not provide investment, tax, legal, or accounting advice. Neither the company nor the author is responsible, directly or indirectly, for any damage or loss caused or alleged to be caused by or in connection with the use of or reliance on any content, goods or services mentioned in this article.

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Vitalik Buterin Has Suggestions for Dogecoin and Doge's Cooperation With Ethereum Altcoins Bitcoin News - Bitcoin News

The Transition Between Fiat And Bitcoin – Bitcoin Magazine

One World, Two Systems: Why Bitcoin And Fiat Must Learn To Live Together

Two competing economic systems eye each other warily across the ideological divide. One is based on complete state control and surveillance of its citizens; the other celebrates personal and financial freedom. The world holds its breath and hopes their mutual hostility does not turn into outright conflict.

No, this isnt the Cold War: its the battle for supremacy between fiat and bitcoin. And as we know from the last century, no one gains from a war between two superpowers, whether the weapons are nuclear or monetary. Instead, the two worldviews must learn to live together.

The worlds separation into two parallel, competing economic systems has already begun. So rather than pick a winner, we need to understand what these two ideologies want to achieve, why each will dominate its own sphere of influence, and how we can navigate this time of transition. And we must ask whether, and how, we can secure cooperation and collaboration between these two so very different worlds.

The rise of Central Bank Digital Currencies (CBDCs) promises to be no less transformative than bitcoin, though they serve a very different ideology: state control. From a fundamental perspective, CBDCs are as poor a store of value as banknotes, and even easier to print. But thats only one reason why governments see a future in digital money. These CBDCs lay the foundation for a universal financial ecosystem where every transaction is monitored and everyones access to the economy is controlled.

If that sounds like dystopian fiction, its merely the logical progression of a process thats already been well advanced today. Just look at Facebook Marketplace: a hyper-efficient online economy that counts its customers in the billions, with incredibly powerful analytics and, crucially, complete control over its users. Break the rules, and youre out.

Its easy to see why Fiat 2.0 is so attractive to governments, but less obvious is why these digital currencies will succeed when bitcoin is superior in so many ways.

To understand why CBDCs are unstoppable, remember that they are designed to work with, and support, legacy financial infrastructure. Centralized digital currencies require no revolution in the worlds financial ecosystem; they can simply piggyback on existing fiat payment rails. Thats one key reason why their success is assured, but it also sets up tensions with the parallel Bitcoin ecosystem.

When CBDCs are the de facto standard for transactions, it creates a paradigm of control. With digital fiat creeping into more areas of the economy, even without the public being fully aware of it, governments will be even less tolerant of any rival system. They will naturally seek as many are trying now to apply the same legacy regulation to the Bitcoin ecosystem, demanding the same types of anti-money laundering, KYC controls, and transaction monitoring.

While its easy to regulate what you can control, Bitcoins value lies in decentralisation: it cannot be censored unless you censor internet access as a whole and it cannot be printed. And while this makes it the perfect means to transfer wealth through space and time, the risk is that governments and legislators will try to strongarm consumers into adopting Fiat 2.0 by adding as much friction as possible into buying, holding and transferring bitcoin. Tensions between the two monetary superpowers are only set to grow.

Bitcoin might be unkillable, but we can expect a rocky road to inevitable regulatory acceptance. There are two ways you can prepare: first, become an expert in Bitcoin at the technical level to understand the workarounds to any obstacles placed in the path of consumer adoption. But this requires a huge expenditure of time and effort, and even then may be beyond most people.

More realistically, people can choose services that are truly aligned with Bitcoins vision. Steer clear of financial services firms that claim to do bitcoin, yet still have a significant stake in the legacy financial ecosystem. Companies like PayPal might have a strong brand and worldwide reach, but unwary users will quickly discover that they dont give ownership of coins to the user and require rigid requirements for withdrawing bitcoin to personal wallets.

And what of the regulators? Well, wed like to see them play a role in bitcoins development - or rather, in the services built on top of it. Weve seen how cryptocurrencies can be used as the foundation for scams and illegitimate crowd-funding endeavors. Just look at what Joseph Lubin has to say in that regard. Wed like to see regulatory frameworks that can avoid the abuse of the Bitcoin ecosystem. For this to work, regulators need to roll their sleeves up, hire experts, and create bodies and discussion panels to examine the risks and propose workable solutions, rather than just slapping layers of legacy regulation on them.

Were seeing the emergence of two monetary standards: one for everyday financial transactions, and the other for storing and transferring wealth. Though neither can win over the other, the legacy financial system can make life unnecessarily difficult for bitcoin and its adherents, yet with no hope of halting the revolution. Lets not see history repeat itself as farce, and hope the two worlds can compete but, where possible, collaborate for the greater good of humanity.

This is a guest post by Nik Oraevskiy. Opinions expressed are entirely their own and do not necessarily reflect those of BTC Inc or Bitcoin Magazine.

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The Transition Between Fiat And Bitcoin - Bitcoin Magazine

Twitter reportedly working on Bitcoin tipping feature – Cointelegraph

Twitter is reportedly laying the groundwork to enable Bitcoin (BTC) tipping for content creators.

According to MacRumors, the latest Twitter iOS beta includes lines of code that could see Bitcoin become a part of the Tip Jar. Indeed, as previously reported by Cointelegraph, Twitter CEO Jack Dorsey had previously hinted that Bitcoin tipping was in the works.

Twitter introduced Tip Jar back in May as a way for users to reward content creators on the popular social media platform.

If the reports of Bitcoin tipping are true, then BTC will be added alongside Cash App, PayPal and Venmo as acceptable payment options on the Tip Jar.

As part of the rollout, Twitter may provide a brief tutorial about Bitcoin and the Lightning Network. According to a portion of the text quoted by MacRumors, the Bitcoin tipping feature will utilize Lightning Network payment gateway Strike to generate Bitcoin Lightning invoices.

The tutorial may also include information about concepts such as custodial and non-custodial wallets for storing Bitcoin.

Related: Jack Dorsey says he will integrate Lightning Network into Twitter or BlueSky

A Bitcoin tipping feature on Twitter is only the latest in a string of BTC-focused adoption developments for the social media giant and for Dorsey himself. Earlier in August, the Twitter and Square chief announced plans to build a decentralized exchange for Bitcoin.

Dorsey has previously described Bitcoin as being the key to Twitters future while stating the companys intention to integrate BTC into services like commerce and subscriptions.

Bitcoin tipping on Twitter via Lightning Network will also confirm plans to integrate LN into the social media platform that first started back in June. The move could also bring crypto token tipping to the mainstream in fulfillment of one of the several use cases for cryptocurrencies espoused by proponents.

In July, Dorsey also revealed that Square was developing an assisted custody hardware wallet for Bitcoin.

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Twitter reportedly working on Bitcoin tipping feature - Cointelegraph

Mastermind of Zimbabwean Bitcoin Pyramid Scheme Vanishes With $6 Million Regulation Bitcoin News – Bitcoin News

Reports from Zimbabwe suggest that an individual by the name of Martin Mhlanga, who is the mastermind behind the Cryptoshares bitcoin pyramid scheme, has disappeared along with over $6 million in investor funds. In addition to Mhlangas disappearance, the individuals thought to be managing Cryptoshares social media channels have similarly vanished.

As one local report explains, Mhlanga had successfully used a series of unrealistic promises to lure many unsuspecting people into investing. For instance, the report explains that many of the victims had been lured into investing by claims that initial Cryptoshares investors were receiving a monthly membership payment of $2,000. Investors were also promised a payout that is double the amount of the initial investment.

Believing that they too would be in line to receive the same monthly payment, some of Mhlangas victims are thought to have sold their properties just so they could raise the required money. Others are thought to have borrowed the required initial investment from banks.

However, once September 1 the day investors were supposed to receive their payout rolled around, it dawned on many Cryptoshares investors that they had been scammed. In fact, as one Twitter user, Tendai Tomu points out, the early signs that the company was collapsing were seen towards the end of August when Cryptoshares was having problems paying investors.

While the report suggests that some Cryptoshares investors have reported this fraud to law enforcement, many in Zimbabwes crypto space insist such a move will not yield much. They point to other bitcoin pyramid schemes like Bitcoin Interchange, which similarly collapsed after fleecing many investors.

Meanwhile, on Twitter, some users like Tendai Tomu are adamant that victims of this latest crypto pyramid scheme will never recover their funds. Tomu said:

Sad indeed! I dont think the funds will be returned because remember he was paying early investors with deposits from new ones so the equation will never balance. The best people can do is to learn from this.

Others like lawyer Prosper Mwedzi have suggested reporting the fraud to cryptocurrency exchanges. However, still others insist such scams will recur unless more is done to educate people about the basics of investing.

What are your thoughts on this story? Tell us what you think in the comments section below.

Image Credits: Shutterstock, Pixabay, Wiki Commons

Disclaimer: This article is for informational purposes only. It is not a direct offer or solicitation of an offer to buy or sell, or a recommendation or endorsement of any products, services, or companies. Bitcoin.com does not provide investment, tax, legal, or accounting advice. Neither the company nor the author is responsible, directly or indirectly, for any damage or loss caused or alleged to be caused by or in connection with the use of or reliance on any content, goods or services mentioned in this article.

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Mastermind of Zimbabwean Bitcoin Pyramid Scheme Vanishes With $6 Million Regulation Bitcoin News - Bitcoin News

From $250 Billion to $2.35 Trillion: A Look at the Top Ten Crypto Market Cap Shifts Over 2 Years Markets and Prices Bitcoin News – Bitcoin News

While the crypto economy is worth more than $2.35 trillion, theres a variety of new cryptocurrencies that have claimed top ten positions, in terms of market capitalization, in recent times. Two years ago, the top ten crypto assets by market cap looked a lot different than today, and things have also changed a great deal in the past 12 months.

Since the crypto assets inception, bitcoin (BTC) has held the largest market valuation out of all the coins in existence and no other digital currency has ever taken the top position. We know the crypto economy is valued at more than $2.3 trillion, and out of the 10,000+ cryptocurrencies, dominance levels are changing. Top ten shifts are happening, and the top ten crypto-asset positions in terms of valuation have changed a great deal last year and the year before.

At the end of August 2019, bitcoin (BTC) held the top position but only had a market valuation of around $181 billion. Today, BTC has an overall market valuation of $929 billion or 413% more than it was in August 2019. That same summer, ethereum (ETH) was the second-largest crypto asset by market cap with just over $20 billion. Today, ETH has an overall valuation of around $443 billion which is a whopping 2,115% increase in two years.

In August 2019, XRP held the third-largest crypto valuation with an $11 billion market cap. The market cap has increased by 427% but XRP now holds the sixth-largest position in terms of valuation among the top ten. Bitcoin cash (BCH) was the fourth largest crypto cap in the late summer of 2019 with an overall valuation of $5 billion. Today it is $12.4 billion which is an increase of 148%, but BCH is now in the 15th position in terms of market valuation. Litecoin (LTC) held the fifth biggest market with $4 billion two years ago, but today, LTC is in the 16th position.

Binance coin (BNB) managed to move up from the sixth position that year, as it now holds the fourth largest crypto market valuation today. Tether (USDT) moved up from two years ago when it was in the seventh position and today, USDT is the fifth position. Tether is still the most valuable stablecoin and has been for the last two years in a row. EOS was in the eighth position back in 2019 and today, EOS has slid all the way down to the 35th top position in terms of market cap.

Bitcoinsv (BSV) was in ninth place in 2019 and stellar (XLM) held the tenth position in August the same year. BSV has plummeted to the 52nd position in terms of market cap and XLM is now the 22nd largest crypto asset. BSV had a $2.3 billion market cap back then and it has improved a bit (34.78%) to todays $3.1 billion. Stellar had a $1.4 billion market valuation while today it is $8.5 billion, gaining 507%.

In August 2020, things were also different. While BTC and ETH held the first and the second position, XRP was really close to being overtaken by tether (USDT) that year. XRP held the third position with a $12 billion market cap and USDT was around $10 billion in August 2020. At that time, BCH, BSV, LTC, and BNB remained top ten contenders. Meanwhile, Chainlink (LINK) held the fifth-largest market cap with a $5.7 billion valuation. LINK is now the 12th largest coin market cap today with $13.5 billion.

Crypto.com (CRO) was in the ninth position in August 2020 with a $3.5 billion market cap and CRO is sitting in the 43rd position today with $4.1 billion. It is interesting to note that all the top ten coins in 2021 have market caps of over $20 billion. While in August 2020, only five coins had market caps over $10 billion, and in 2019 only three coins were over $10 billion. CRO and BSV have seen very little increases in market valuation in two years, while other markets have seen much larger gains.

Moreover, coins like dogecoin (DOGE), solana (SOL), cardano (ADA), polkadot (DOT), and usd coin (USDC) are all newcomers as far as the top ten cryptos are concerned. Solana (SOL) is up more than 19% in 24 hours and recently flipped dogecoin (DOGE) in terms of market cap.

What do you think about the changes in the top ten cryptos during the last two years? Let us know what you think about this subject in the comments section below.

Image Credits: Shutterstock, Pixabay, Wiki Commons, Coingecko, Coinmarketcap.com,

Disclaimer: This article is for informational purposes only. It is not a direct offer or solicitation of an offer to buy or sell, or a recommendation or endorsement of any products, services, or companies. Bitcoin.com does not provide investment, tax, legal, or accounting advice. Neither the company nor the author is responsible, directly or indirectly, for any damage or loss caused or alleged to be caused by or in connection with the use of or reliance on any content, goods or services mentioned in this article.

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From $250 Billion to $2.35 Trillion: A Look at the Top Ten Crypto Market Cap Shifts Over 2 Years Markets and Prices Bitcoin News - Bitcoin News

Yes, bitcoin could be the new GameStop – CNBC

It has been a volatile few months for bitcoin.

On Friday alone, the cryptocurrency briefly shot 20% higher after billionaire Tesla founder Elon Musk changed his Twitter bio to "#bitcoin."

Though it quickly gave up those gains, there are parallels between bitcoin's swift move higher and the GameStop stock mania, which continues to dominate the global news cycle.

The battle of hedge-fund short sellers versus retail traders who are coordinating on social media to drive the price higher could be a sign of what's to come for the world's biggest cryptocurrency.

Data from crypto news and analysis company The Block shows that hedge funds are short bitcoin by more than $1 billion.

That term "shorting" means that traders and hedge funds are betting that the price of bitcoin will go down. Those short positions ramped up starting in October 2020, just as bitcoin's latest rally began to take hold.

Meanwhile, individual investors are still buying into bitcoin, among other cryptocurrencies, as they bet that the price will go up.

Sound familiar?

Retail brokerages including Robinhood have extended trading restrictions on stocks such as GameStop, and as of Friday, the trading app is also limiting trading in cryptocurrencies.

Unlike GameStop, a brick-and-mortar mall business that was closing stores even before the pandemic led to widespread shutdowns, analysts say the fundamentals underlying bitcoin tell a more promising story.

Analysts at JPMorgan think the price of bitcoin could rally as high as $146,000, and the global head of CitiFXTechnicals says the charts signal that bitcoin could reach $318,000 by December.

Part of what's different about bitcoin's rally in 2020 versus its last run higher, in 2017, is that institutional investors are now adopting bitcoin, lending it newfound legitimacy and helping to erase the reputational risk of investing in the cryptocurrency.

"We've seen the majority of folks like insurance firms, asset managers, hedge funds and corporate balance sheets come into the market in 2020," said Michael Bucella, general partner at crypto firm BlockTower Capital.

The surge in interest from mainstream financial players hasn't just reformed bitcoin's image, it's also fomented a supply shortage.

"There is a large and emerging group of institutions that have an enormous capital base that are reallocating to this space," Bucella said. "And if you think about the supply-demand model of a commodity, the supply curve is declining over time to effectively zero, and the demand is increasing exponentially."

There will only ever be 21 million bitcoins in existence, because, like other cryptocurrencies, it was built around the principle of a finite supply. The total number of mined bitcoin is at roughly 18.6 million, so it's nearing its maximum threshold.

And that interest from institutional investors doesn't appear to be slowing down.

"There's a lot of demand, and there's not enough supply of bitcoin for every financial institution to have their own reserve to serve their clients," said McKenzie Slaughter, a member of the Black Women Blockchain Council.

The GameStop saga has been driven by a large group of Reddit day traders, at least some of whom are motivated by wanting to stick it to Wall Street. They coordinated online to pile into GameStop in order to drive the price of the stock higher, with the specific purpose of causing hedge funds to lose money.

That same underlying anger and frustration over how institutional investors make profits has also played a role in bitcoin's rise. A big part of the cryptocurrency's intrinsic value is derived from the fact that it isn't tethered to any one governmentnor is it pegged to other currencies.

Investing in an independent cryptocurrency such as bitcoin, therefore, means you are putting your money toward a technology and a currency that could one day replace the modern financial system. This is certainly not lost on retail traders looking for the ultimate way to cut institutional investors out of the equation.

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Yes, bitcoin could be the new GameStop - CNBC

Silver Is the New GameStop as Musk’s #Bitcoin Stalls – CoinDesk – CoinDesk

Bitcoin (BTC) quickly settled back into the past couple weeks range between roughly $30,000 and $36,000, after a short-lived price spike Friday when Elon Musk, the electric-vehicle and private-spaceflight entrepreneur whos also reportedly the worlds richest person, added #bitcoin to his Twitter profile.

The longer we stay at the current level, the stronger the base to bounce back up, Matt Blom, head of sales and trading for the exchange firm EQUOS, wrote early Monday. Bitcoin prices finished January up 14% on the year.

Last weeks Reddit-fueled trading in GameStop bore uncanny similarities to the fevered, anything-goes trading culture that has long defined cryptocurrencies. The five-fold jump in prices for dogecoin (DOGE) a blockchain-based token representing little more than a doggie-faced meme showed some of that retail-trader-driven mania spilling over into digital markets.

During an audio chat late Sunday on the app Clubhouse, Musk said he was a supporter of bitcoin and that its on the verge of getting broad acceptance by conventional finance people. He added that the most entertaining and ironic outcome would be if DOGE became the currency of earth in the future.

Where will markets go next? The news of Indias proposed crypto ban has made some bitcoin investors nervous, CoinDesks Tanzeel Akhtar reported Saturday. Meanwhile, Chinese traders late last week were already speculating on which cryptocurrencies might be the next to get a major price pump, CoinDesks Muyao Shen reported.

Prices for the digital token XRP (XRP) have nearly tripled in the past five days. They had fallen 67% in December, when U.S. securities regulators brought charges against Ripple Labs, which uses XRP in its payments network.

In traditional markets on Monday, stocks were higher in Europe and Asia, but the real action was in silver, where prices have climbed 16% over the past three days to about $30 an ounce amid a Reddit-fueled buying frenzy. Gold strengthened 0.9% to $1,860 an ounce.

Bitcoin price chart puts Elon Musk's #bitcoin moment into context.

Market Moves

The "Grayscale premium" is shrinking, and analysts are speculating why.

The "Grayscale premium," a closely watched gauge in the bitcoin market, has recently fallen to a historically low level.

A growing number of cryptocurrency analysts are watching a steep contraction recently in a closely-tracked ratio in the bitcoin market known as the Grayscale premium.

This premium represents the difference in market prices for bitcoin and the price implied by the Grayscale Bitcoin Trust (GBTC), one of the most popular vehicles for investing in the cryptocurrency via the stock market. (EDITORS NOTE: Grayscale Investments, which sponsors GBTC, is a unit of Digital Currency Group, which also owns CoinDesk.)

Whats getting attention now is that the Grayscale premium last week fell to as low as 3.5%, from upwards of 40% late last year, according to Ycharts.

Many observers say one explanation for the premium might be the lack of alternatives, especially since the U.S. Securities and Exchange Commission has yet to approve a bitcoin-focused exchange-traded fund in the U.S. When the premium is elevated, its seen as a sign of just how eager retail stock traders are to bet on bitcoins price.

So the recent decline might be explained by signs that greater competition is on the way: BlockFi, a major hub for crypto lending, has filed to start a new bitcoin trust, CoinDesks Danny Nelson reported. According to The Block, Osprey Bitcoin Trust will list on over-the-counter markets in coming days. In Canada, the investment firm Ninepoint Partners completed an initial public offering of a cryptocurrency fund worth a reported C$230 million (US$180 million).

Yet there may be another factor: Flagging demand for bitcoin with prices over $30,000, double their level just a couple months ago. Some institutional investors who were betting on the price to keep mooning may have lost their nerve, and the premium collapsed as they rushed to exit positions.

The dissipation of this premium is further evidence of the internal stresses of the markets on bitcoin, Greg Cipolaro, global head of research for NYDIG, a digital-asset investment firm, wrote Friday in a weekly report.

He noted that the gap has also compressed between spot prices for bitcoin and futures contracts traded on the Chicago-based CME possibly another indication that traders are taking less market risk in the face of heightened volatility.

Bitcoin Watch

"A BTC bull and believer"

Bitcoin's daily chart shows the cryptocurrency probing bearish trendline hurdle.

The rally triggered by Tesla CEO Elon Musk adding #bitcoin to his Twitter profile quickly fizzled, but Su Zhu, CEO of the cryptocurrency investment firm Three Arrows Capital, says that long-term, its very bullish.

Elon news is a watershed moment for crypto as the wealthiest man in the world and operator of the worlds most successful companies is now a BTC bull and believer, Zhu told CoinDesk in a Telegram chat.

Denis Vinokourov, head of research at the London-based prime brokerage Bequant, expects range-bound trading to continue for a while. He points to healthy market signs, including growth in blockchain-based trading and lending systems of decentralized finance (DeFi). Flow into exchange-traded products remains strong, he said.

Everyone is looking for catalysts but I dont think any new catalysts per se are required, Vinokourov told CoinDesk.

Token Watch

CoinDesk 20 Returns in January

Stellar (XLM), the payments token, surged 143% in the first month of the year to dominate the CoinDesk 20 set of digital assets. Ether (ETH), the native cryptocurrency of the Ethereum blockchain, gained 77% on the month. Bitcoin rose 14%.

CoinDesk 20 returns in January, versus the U.S. dollar. (Note there are only 17 shown here, because the other three are dollar-linked stablecoins whose value usually doesn't fluctuate much.)

What's Hot

Crypto industry booms but doesn't quite "Zoom," while Elon Musk gets immortalized on the Bitcoin blockchain.

One of the biggest questions facing the crypto industry over the past year has been whether the companies and their new-tech platforms could Zoom where suddenly everyone starts using the product. Last week showed theres plenty of progress still to be made on that front. The industry groaned under the newfound attention from ready customers, some of them ostensibly fleeing the trading platform Robinhood following a series of anger-inducing trading suspensions. Outages were reported at crypto trading venues including Coinbase, Kraken, Binanceand Voyager. New York Department of Financial Services Superintendent Linda Lacewell tweeted that, as the states virtual-currency regulator, she was actively monitoring market volatility.

Elon Musks Twitter account got a hat tip in the form of a message encoded into the Bitcoin blockchain. The phrase, In retrospect, it was inevitable, was written by a clever bitcoin miner into the record for data block 668197, shortly after the worlds richest man updated his profile to include the hashtag #bitcoin.

Bitcoin blockchain explorer reveals message encoded into blockchain data block 668197 quoting Elon Musk's Twitter account.

Analogs

The latest on the economy and traditional finance

The hedge fund Greylock is known for making bets on the government debt of troubled nations like Argentina, Lebanon and Venezuela. Now, according to Bloomberg, Greylock, led by and CEO Hans Humes, has filed for bankruptcy protection, apparently seeking the courts help to wriggle out of its own liabilities. The proceedings reportedly will allow Greylock to terminate its $100,000-a-month office lease in Manhattan. (Bloomberg)

Reddit user DeepFValue who helped direct WallStreetBets campaign on is a 34-year-old former insurance-marketing executive who has just made $20M from gains on GameStop shares and options. (WSJ)

Fundamentals have never mattered less as GameStop saga makes a mockery of the idea that markets provide an efficient form of capital allocation in the economy, James Mackintosh writes in column. (WSJ)

For public companies, there are benefits to having no supply caps: Data show a rise in shelf registrations for potential securities sales, as CEO prepare to take advantage of buoyant market conditions. (WSJ)

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Silver Is the New GameStop as Musk's #Bitcoin Stalls - CoinDesk - CoinDesk

This investor in both gold and bitcoin says only one offers real long-term safety – MarketWatch

Spoileralert: I own both gold and Bitcoin in my portfolio.

As a longtime participant and observer of the shifting currents of monetary policy and financial markets, I believe both can play vital roles as repositories of value, especially in a world plagued by economic and political uncertainty.

But although they share some similarities, there are important differences that persuade me that contrary to growing opinion, bitcoin BTCUSD, +0.02% will not supplant gold GC00, -0.07% as the choice of investors seeking long-term safety.

Admittedly, bitcoin advocates have some momentum on their side, as its price hit a record above $40,500 in early January. After a recent pullback, bitcoin still trades around $30,000. Prominent institutional investors have become bitcoin fans; BlackRock, the worlds largest money manager, called it a durable mechanism that could take the place of gold to a large extent.

Yet, to paraphrase Mark Twain, the reports of golds demise have been greatly exaggerated. Bitcoin is certainly a legitimate asset and has the potential to be a true store of value joining a select group of assets, commodities and currencies that can be saved, retrieved and exchanged without deteriorating in value.

However, gold has at least a 2,500-year head start as a widely-accepted, global medium of exchange and value. Compared to bitcoin, the gold market enjoys great depth and liquidity. The total amount of physical gold held by investors and central banks is an estimated $3.7 trillion. Thats nearly seven times the market capitalization of all bitcoin created. Both gold and bitcoin enjoy highly liquid markets, but golds average daily volume in 2020 was $125.3 billion, or 30 times bitcoins daily spot volume of $4.1 billion.

I own gold for insurance to offset the effects of inflation and as a safe haven to offset any steep losses in other parts of my portfolio. Bitcoins role in my portfolio is that of a speculative asset, rather than to protect wealth. I became interested while I was director of the U.S. Mint and wanted to understand cryptocurrencies, and the best way was to try it. Since leaving government service, I have become an investor in bitcoin.

While both gold and bitcoin can be seen as islands of security in an ocean of financial turbulence, we must understand their similarities and significant differences.

In both cases, their value is supported, in part, by scarcity. Gold is limited by physical supply and the difficulty of extraction, while bitcoin creation is capped at 21 million by its source code. These qualities, as well as the deep, liquid markets I noted earlier, mean that both gold and bitcoin have the potential to retain value, and in fact appreciate, during difficult economic cycles.

And unlike government-made currencies like the U.S. dollar, whose value derived from confidence in the issuing government and laws requiring citizens to accept it, gold and bitcoin have other uses, and the markets generally determine their value.

Gold, however, has an unmatched long-term record as a store of value. Economists have shown that, over the past 50 years, gold more than held its own in times of low inflation and rallied strongly during periods of high inflation. Since bitcoin has only existed since 2009 and its active trading market is even more recent, it is too soon to tell how its value will hold up over time.

The differences between gold and bitcoin are meaningful. For one, bitcoin is volatile, having fallen more than 20% from its Jan. 8 high. Over the same period, gold declined about 3%. This lack of volatility is one reason investors gravitate toward gold.

The run-up in bitcoin over the last year may largely be due to a new class of investors, attracted to a more transparent regulatory environment. Many new bitcoin owners are institutions, including private-equity firms, hedge funds, insurance companies, pension funds and endowments. Once this initial institutional surge of buying normalizes, bitcoins price escalation may not be sustainable.

Another advantage of gold is that one can take physical delivery, while digital currency exists as an electronic ledger entry. Weve heard about the British investor claiming to have accidentally thrown away a hard drive containing a cryptographic key to about $300 million in bitcoin that may now reside in a trash dump in South Wales. Its hard to imagine misplacing that amount of gold coins or bars. By holding physical gold, the investor owns its full value and has no counterparty risk.

Furthermore, despite expectations that Bitcoin would be used for everyday transactions, that degree of wide acceptance has not yet occurred. Bitcoin is more likely to be used as money in countries where there is little confidence in government currency and will take longer to be widely accepted as money in economies where government money is generally trusted, like in the U.S., Japan and across Europe.

While these differences explain why bitcoin wont entirely replace gold, both make sense in a well-managed portfolio. The continuing economic uncertainties wrought by COVID-19, the lower-for-longer interest rate policies of central banks, and the volatility of the highly valued equity market make a strong case for owning assets whose value is not tied to economic vagaries or government policies.

As an investor, why should I have to choose between the two? I think there advantages to owning both.

Edmund C. Moy was the 38th director of the United States Mint and is now chief market strategist at Valaurum, a company that enables investors to buy gold in small, more affordable increments.

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This investor in both gold and bitcoin says only one offers real long-term safety - MarketWatch

Behind the Bitcoin Bubble – The Wall Street Journal

To figure out if youre in a bubble, you need to find the source of the hot air. Obvious for GameStop , but for bitcoin, not so much.

In July 2018, we wrote about the cryptocurrency company Tether, which issues tokens called tethers that trade under the symbol USDT and should be valued at $1making the currency a stablecoin. Tethers creators might have manipulated bitcoin, a University of Texas paper suggests, by issuing tokens willy-nilly unbacked by real dollars and then buying bitcoin to jack up its price. (The company claims the research is flawed.)

At the time, Tethers total value was some $2.7 billion, and its website claimed: Every tether is always backed 1-to-1 by traditional currency held in our reserves. So somewhere there should have been $2.7 billion in real moneythats how a stablecoin is supposed to work. In November 2018, New York state Attorney General Letitia James invoked the Martin Act to begin an investigation into iFinex, which owns Tether and the Bitfinex cryptocurrency exchange, in connection with ongoing activities that may have defrauded New York investors. The company has disputed the attorney generals claims, denied it misled customers, and said it will fight any action. An appellate court last year rejected its challenge to the probe.

Bitcoin peaked at the end of 2017 at $19,000 and over the next year collapsed to $3,200. Welltheyre baaack! On Friday Elon Musk was the latest to pump Bitcoin, which briefly reached almost $38,000. And there are now some $26.4 billion of USDT tokens, $18 billion of which were created since March 2020. Why the increase? No one has a good explanation.

All that glitters is not gold. In 2019 Tether subtly updated its claim to say reserves may include other assets and receivables from loans made by Tether to third parties. Tether has even admitted it only has 74% of the cash or cash equivalents to back its stablecoin. Hmmm. Basically unbacked.

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Behind the Bitcoin Bubble - The Wall Street Journal

Bitcoin White Paper – Miami – City of Miami

Published on January 26, 2021

The City of Miami is dedicated to becoming a model 21st century city. We think that means embracing and supporting disruptive technologies that challenge the status quo and improve how we interact with one another. Bitcoin, the decentralized financial network that allows individuals worldwide to store and send value to one another without intermediary agents like banks or payment processors, is a technology we believe will transform the world.

Bitcoin is the invention of a pseudonymous computer programmer called Satoshi Nakamoto. In October 2008, the still unknown Satoshi published a white paper called "Bitcoin: A Peer-To-Peer Electronic Cash System," outlining his proposal and the mechanics of what we now commonly refer to as Bitcoin's "blockchain." The Bitcoin network has run continuously and without incident since its launch on January 3, 2009. The network currently secures over $600 billion in value and its native cryptocurrency (bitcoin with a lowercase "b" or "BTC") is seen by many experts as the next great store of value and akin to a digital gold.

The City of Miami is actively exploring how we can best utilize Bitcoin and related technologies and are committed to supporting and attracting businesses and entrepreneurs innovating in the space.

Read the Original Bitcoin White Paper(PDF,231KB).

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Bitcoin White Paper - Miami - City of Miami

Bitcoin and Inflation: Everything You Need to Know – CoinDesk – CoinDesk

Crypto enthusiasts often talk about bitcoin as a hedge against inflation. Why?

The argument is that central bank money printing will lead to inflation or the decrease in the value of money over time. Bitcoin, by contrast, has a fixed limit of 21 million coins that can ever be created. This limited supply allows bitcoin to resist inflation.

The COVID-19 pandemic presented the ideal conditions to test this theory once countries across the world began injecting trillions of dollars into their economies. Many countries, including the U.S., printed money to meet stimulus requirements for its citizens.

Yesterday, the chairman of the U.S. Federal Reserve, Jerome Powell said the central bank welcomes higher inflation in 2021 as a sign that the economy is picking up again after the pandemic-slump.

Governments hoped an expansionary monetary policy, whereby central banks increased the amount of money available to people, would keep economies moving amid prolonged shutdowns of certain sections of the economy. By June 2020, stimulus action taken by countries had surpassed $10 trillion, according to a McKinsey Global report. U.S. government-spending alone amounted to $6.5 trillion in 2020, up 48% from the previous year.

Theres a crazy amount of money being printed right now, so the value of money is going down. Assets with limited supply, like bitcoin, real estate or shares/stocks, those price tags are going up, Oki Matsumoto, CEO of Monex Group told CoinDesk.

Its true that despite dramatic drops in global economic output and unemployment, market jitters drove asset prices up: the stock market ended the year with record gains. Even bitcoin, considered a fringe asset, had a historic price run, gaining more than 250% by the end of 2020.

These gains were partly influenced by traditional investors who saw bitcoins potential to work as a hedge against inflation.

And yet, the kind of inflation investors were expecting isnt here, at least not yet. In fact, U.S. inflation remained stable through 2020. Some economists dont believe that inflation in America will be running rampant any time soon. Others think a little post-pandemic inflation might even be a good thing.

What is inflation, anyway?

It depends on whom you ask.

The U.S. Federal Reserve defines inflation as the increase in the price of goods and services over time, but many associate it with a change in the money supply, or the total amount of money in circulation.

In the bitcoin world, they dont use the term inflation quite the way that economists do, as a general increase in consumer price. Instead, they tend to use it to mean an increase in the money supply, said economist and CoinDesk columnist Frances Coppola.

The crypto argument that printing more money leads to inflation does sound compelling, Michael Ashton, inflation consultant and JPMorgan alum, told CoinDesk. When there is a change in the relative quantity of two goods, the one that is increasing in quantity tends to get cheaper, he said, adding that this happens with foreign exchange all the time.

The reason why the Mexican peso has been cheap relative to the U.S. dollar for a long time is because the supply of Mexican Pesos has consistently outpaced the supply of U.S. dollars, Ashton said. Because here are a lot more pesos than dollars out there, he explained, the value of the peso in exchange markets goes down.

Thats part of the crypto argument. They say, Were gonna limit how fast cryptocurrency supply can grow and since we are printing all these dollars, then that means that the dollar has to depreciate a lot relative to crypto. Therefore, the price of crypto should rise over time, Ashton said.

Calvo said the view that you can control the price levels of goods and services through money supply is not limited to the crypto world but shared by investors in general, and for good reason. When you look at many countries over a long period of time, you can see some association between the increase in money supply and inflation, Calvo added.

But Calvo, Coppola and Ashton all agree that increasing the amount of money in the economy with a stimulus package, for example does not guarantee a rise in price levels.

If you increase your money supply, you may or may not get an increase in the consumer price level depending on what else is going on in the economy at the time. So there are a number of other factors to consider, Coppola said.

Money is printing, is inflation soaring?

Not really, at least in the U.S.

The U.S. Federal Reserve has an inflation target of 2% measured using the consumer price index (CPI). In 2020, despite inflationary fears due to pandemic-related spending, the U.S. inflation rate hovered around 1.5%, well below target.

One explanation for the relative stability of U.S. inflation is money velocity, which quantifies how fast money changes hands in an economy. If the money supply is increased, but people dont spend a lot of money quickly, inflation can remain in balance.

After the pandemic hit, consumer spending suffered around the world, with countries including the U.S., India, Japan and Germany reporting large drops in household spending. As multiple states in the U.S. went under lockdown, people stayed home instead of dining out, celebrations and gatherings stopped, and travel came to a screeching halt.

People spending less meant the demand for goods and services in general had dropped. Global energy demand declined 6% in the first few months of 2020, its biggest drop since World War II, according to the international energy agency (IEA).

Weaker demand and significantly lower oil prices are holding down consumer price inflation, the Federal Reserve wrote in its June 2020 monetary policy report.

The World Bank, in fact, projected a fall in global commodity prices.

It is under these prevailing conditions that the U.S. government was distributing stimulus funds.

So people are accumulating money, but it is not reflected in the price level, Calvo said.

Ashton explained this may be because money velocity is very low. People are not getting rid of U.S. dollars fast enough, so the price levels dont increase dramatically.

When you drop a ton of money into peoples bank accounts, they cant spend it instantly. So, mathematically, you have to have a declining money velocity. Thats what happened, Ashton said.

What about outside the U.S.?

American inflationary fears may be in part due to whats happening in other parts of the world. Some investors may be looking at countries like Argentina and Venezuela where printing money has led to very high inflation.

What investors are doing, in general, is looking ahead and saying, were seeing a lot of money going into the economy. Therefore, there is a risk that it could happen in the United States; therefore, we need to invest in things that will protect us from that inflation, if it happens. Thats the conventional inflation is coming, we need to protect against it argument, Coppola said.

But in the countries they are looking at, things work differently, Coppola added.

Venezuela and Argentina are hyperinflationary economies where price levels grow rapidly and excessively triggered by an increase in the money supply or a shortage in supply relative to demand.

In Venezuela, for instance, printing money led to jaw dropping increases in food prices last year. The international monetary fund (IMF) reported that the inflation rate in Venezuela was a whopping 6500% in 2020.

In hyperinflationary countries, years of political and economic instability have exhausted the option of printing money without leading to uncontrollable inflation, Calvo said. Coppola added that countries struggling with hyperinflation have other contributing issues like high foreign exchange debt, war, occupation or something political.

Argentina, for example, has had a long and complicated economic crisis riddled with astronomical debt obligations and political instability that often has citizens scrambling to convert their Argentine pesos into sturdier assets or currencies.

In Argentina, the minute [the government] starts increasing the money supply, very quickly, you see the consequences in the price level, Calvo said, adding, Some countries have the privilege of printing money if necessary. Nothing happens. Argentina doesnt have that privilege.

Interestingly, the pandemic has not particularly spurred inflation in Argentina either. By mid-2020, inflation in Argentina had reached a two-year-low, according to a Focus Economics report.

Because Argentines were also under lockdown during the pandemic, the slowed economy and low demand combined with increases in government spending hasnt caused a major rise in price levels, Calvo said.

If inflation isnt soaring, why are people hedging against it?

People may be buying bitcoin as a hedge against future inflation, and theyre not crazy to do so.

According to a statement made to the media by Federal Reserve Vice Chair Richard Carida, the Federal Reserve will continue to maintain near zero interest rates until inflation rises enough to meet its 2% target.

U.S. policy makers know exactly what theyre doing, said Phillip Gillespie, chief executive officer of crypto liquidity provider B2C2 Japan.

They are basically going to suppress the interest rates and let inflation run higher, Gillespie told CoinDesk.

But economists are saying that as the country reopens and spending picks up, reining in price levels to maintain the inflation target will be one of the biggest challenges in the Federal Reserves 108-year history.

So naturally, investors are reacting to all the inflation doom and gloom by betting against it, turning an alternative asset like bitcoin into the 2020 breakout star of inflation hedging in the process.

Bitcoin inherited a lot of the same selling points that made gold a preferred inflation hedge like scarcity and portability, according to J.P. Koning, Canadian financial writer and founder of the popular blog Moneyness.

But when it comes to serving as a hedge against inflation, bitcoin is hardly alone.

If you look around your house, everything is an inflation hedge, Koning said. Your house itself is an inflation hedge, your table, your personal capital, your education are all inflation hedges because all of those things will rise in value as the purchasing power of the currency falls.

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Bitcoin and Inflation: Everything You Need to Know - CoinDesk - CoinDesk

What the crypto bill means for bitcoin investors – Mint

A new bill listed for introduction in Parliament seeks to bar all private cryptocurrencies in India. It comes nearly a year after the Supreme Court quashed a Reserve Bank of India ban on crypto-related payments. Mint decodes what the bill means for crypto investors.

How does fiat money compare to crypto?

Traditional currency is maintained in paper or metal form, such as notes and coins, or in electronic form in account entries made by banks. Cryptocurrency is also a form of electronic money. The difference is that the record of cryptocurrency is maintained simultaneously by thousands of computers instead of a centralized entity such as a bank. Thus, the record of cryptocurrency cant be tampered with by any person or authority. Cryptocurrencies such as bitcoin also tend to have limited supply. This has raised their price in the face of large money printing by central banks around the world following the covid-19 pandemic.

What sets blockchain apart from crypto?

Blockchain is a technological system that is used for maintaining records in a manner that they cannot be easily tampered with. The system can be applied to any type of record like educational certificates, land, or as in case of cryptocurrency, money. Governments globally have taken a positive view of blockchain and a negative view of cryptocurrency. This also appears to be the view taken in the crypto bill to be tabled in the Parliament. However, experts argue that the two cannot be separated. They say blockchain is powered by cryptocurrency and cannot function effectively without the latter.

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Does India consider crypto as a legitimate currency?

In 2018, the Reserve Bank of India banned banks from processing payments linked to cryptocurrency. This ban was overturned by the Supreme Court in March 2020 as violative of the freedom of business and profession under Article 19(1)(g) of the Constitution. Since then, the cryptocurrency sector has operated in a legal vacuum in India.

What does the govts crypto bill propose?

The bill listed by the government, for introduction in the Parliament, seeks to prohibit all private cryptocurrencies and lay the groundwork for an official digital currency. Such official currencies are being contemplated by several central banks around the world, including China. Cryptocurrency professionals have argued that cryptocurrencies such as bitcoin and ether operate on public ledgers and hence cannot be called private cryptocurrencies. The detailed provisions of the bill have not yet been released to the public.

Should you sell your cryptocurrency?

The detailed legislation will offer more clarity on whether you should sell your cryptocurrency. The bill, however, mentions that certain exceptions may be made to preserve the underlying tech of cryptos (blockchain). Not all bills introduced in the Parliament are passed in the same session. The bill could be referred to a panel or deferred to a later session. Earlier investments in cryptos cannot be criminalized because of Article 20 (1) of the Constitution, which prohibits the state from passing retrospective criminal laws.

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r/WallStreetBets Shows Bitcoin’s In The Game – Bitcoin Magazine

The financial space is a juicy island ruled by a few to serve their own interests, tightly controlled to stay as is. That we already know, and it is more or less commonly accepted, even though we dont see or acknowledge the mechanisms that are used to keep it this way.

What the Reddit community r/wallstreetbets (WSB) achieved last week was truly brilliant. It coordinated a myriad of actions from the little guys to overturn the big guys investment strategies. The fact that its members made money or that hedge funds lost some is beyond the point. Whats exhilarating to see is the fact that coordinated action can have huge systemic effects, even in the kingdom of crony capitalism, Wall Street.

Moreover, their action was so imprvisible that after that big punch to the face of the Boardroom Cartel, the overlords of Wall Streets felt so cornered they had to immediately react with the most despicable and yet normally hidden tactic: more control, more manipulation, more coercion, more corruption. But this time they acted under the spotlight, in plain sight, and everyone paying attention was a witness to the completely unfair advantage they have over everyone else in this game: they do whatever they want to push things in the direction that fits their needs.

As a reminder, some hedge funds decided to short the GameStop stock, but WSB members coordinated their action to long the price and pushed the market up as much as to push the hedge funds positions to liquidation, pushing the price even higher. As a result of the market going in the wrong direction (i.e., hedge funds not making money), Robinhood was forced (by whom?) to close access to trading the GameStop stock. (About half of Robinhood users had a position on GameStop.) Now these users can only sell their positions to push the market back down again. Thats how far flagrant manipulation can go to keep the hedge funds investment strategies in the green.

WSB did manage to expose the systemic corruption of the financial and monetary system.

But even though WSB won a battle, its still fighting an uphill war. As we have seen, Wall Street has enough versatility and ammunition to fight back and to crush this upheaval in the long run. As long as the little guy uses the same weapons as the big guys, and continues to fight on his masters battlefield, like the heavily-regulated financial markets, he doesnt stand a chance.

This series of events have been eye-opening, both to the fact that coordinated action can compete with powerful cartels, and to the fact that the money game we all play is completely rigged.

For so long, the promoted motto has been to try and win the game, but we now understand the game itself has to be overthrown for it to be replaced with another, more fair and open game.

This saga attracted the Bitcoiners attention and sympathy toward the effects of WSBs coordinated actions. They also shared the amertume of playing a rigged game and being openly cheated by the consequences of government-imposed, unsound money and systemic corruption.

Bitcoin is a serious contender in this rigged game of fiat money and market manipulation. It proposes a new set of monetary rules, this time engraved in widely-distributed code, to get back power that has been concentrated in the hands of governments and corporations and put it back in the hand of every little guy to build a truly open market.

I can already feel the Bitcoin submarine reaching the surface to welcome the WSB community, and I hope we can all share some knowledge on how to create a better game together.

Maybe some of them will get onboard

This is a guest post by Arkantos. Opinions expressed are entirely their own and do not necessarily reflect those of BTC Inc or Bitcoin Magazine.

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r/WallStreetBets Shows Bitcoin's In The Game - Bitcoin Magazine

Laying out the biggest risks of investing in bitcoin in 2021 – KTAR.com

(Pixabay Photo)

No matter where you stand on bitcoin, we can agree on one thing: Its polarizing. Some investors believe its the way of the future and others think its a scam.

However, its gaining popularity. Its likely that the coronavirus pandemic accelerated its acceptance by pushing more retail online. Now, more than one-third of small- and medium-sized businesses will take bitcoin as payment.

And even bigger businesses like Microsoft are starting to accept it. Also, fans of bitcoin see it as a safeguard against inflation. And since the Federal Reserve has been printing money left and right, some are getting nervous about the future of the dollar.

You might be wondering: Should I jump on the bitcoin bandwagon, or run in the opposite direction? Here are four risks I want you to consider before taking the plunge:

Bitcoin is one of the most volatile investments you could make

Bitcoin goes through incredible spikes and plummets in value. Back in July of 2010, a year after bitcoin was released to the world, a bitcoin was worth only eight cents.

The value jumped all over the place until it really started to make some waves in 2017. One bitcoin reached a value of $1,000 early on, then zoomed to $5,000 in October, then doubled to $10,000 in November.

By mid-December one bitcoins value was almost $20,000. The bubble finally burst and the value dropped to about $3,500 by November 2018.

But bitcoins value started to skyrocket again in 2020. Just a couple weeks ago, the value of a bitcoin had hit an all-time high of just under $42,000, but then tanked within 24 hours down to $34,863.

Will it continue to grow in value? We dont know. But the reality is that volatility always equals risk. And risk isnt a bad thing, but you need to be aware of what it might cost in the end.

Bitcoin has a bit of an identity crisis

Does bitcoin have more in common with the U.S. dollar or with gold? The answer is both.

While bitcoin is a currency, Uncle Sam has a different take. The Commodity Futures Trading Commission sees bitcoin as a commodity (like gold), while the IRS treats it like property, which means you guessed it they can tax it.

We need to keep in mind that bitcoin is still the new kid on the block. While its been around for over 10 years now, we still dont have any tried and true best practices for building wealth with bitcoin.

Bitcoin is not regulated by any central bank or nation

Bitcoin has been shrouded in mystery ever since it was released in 2009. It operates without oversight from any bank or nation-state, meaning its exchanged peer to peer.

Its like the Wild West of currencies theres no marshal to uphold the law. For some, this is an attractive feature. Others recognize the risk that comes with zero regulation.

Bitcoin is widely used for illegal activity

Since all bitcoin trading is handled anonymously, the cryptocurrency scene is a hot spot for cybercrimes.

All sorts of shady things, from blackmail to phishing to Ponzi schemes to deals done on the dark web, take place using bitcoin.

Of course, there are plenty of upstanding people who use cryptocurrencies as well. But hackers who know a lot more about coding and software than the average Joe can use that knowledge to their advantage, so be careful.

As youve probably guessed, Im not a fan of bitcoin. I would much rather see you invest your hard-earned cash in proven methods for building wealth, like tax-advantaged retirement accounts and growth stock mutual funds.

But if you want to learn more about bitcoin, check out our full blog post on the subject.

The most important thing is to be aware, informed and in control of your financial choices at all times!

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Laying out the biggest risks of investing in bitcoin in 2021 - KTAR.com

Elon Musk talks Mars, monkey brain implants and Bitcoin in Clubhouse interview – CNET

Elon Musk joined the Good Time

Elon Musk, theSpaceX and Tesla head honcho, appeared on theexclusive audio-only Clubhouse app Sunday night, joining the Good Time Show to talk all things Mars, memes and becoming a multiplanet species. The app, which allows people to create rooms for conversation, didn't fare too well. The cap on participants is set at 5,000 -- and it was quickly overwhelmed as Musk fans clamored to hear theworld's richest man speak.

Still, enterprising YouTubers and Discord servers popped up, and far more than 5,000 people got to hear some surprising claims about Mars and monkeys. In his characteristic fashion, Musk made some bold claims about when people might get to the red planet, discussed his Twitter memes and detailed some of the progress his team at Neuralink has made. It was meandering and, at times, bizarre, but Musk did reveal a few interesting details.

Let's start with Mars. If you're wondering what Musk's timeline to get humans on Mars is, you might be surprised.

"Five and a half years," Musk told hosts Sriram Krishnan and Aarthi Ramamurthy at the beginning of the show.

From the lab to your inbox. Get the latest science stories from CNET every week.

Musk has been known to put ambitious deadlines on his projects, from Tesla to SpaceX, but five and a half years to get Starship off the ground and ferrying humans to another planet? That's a whole other level of ambition. But that's not a hard deadline. Musk listed a number of caveats -- there's a raft of technological advances that must be made in the intervening years.

"The important thing is that we establish Mars as a self-sustaining civilization," he said.

After Mars, Musk got applause for his meme abilities, which he partly attributed to "meme dealers," before the topic swerved to something more serious: Neuralink, the brain-implant startup he founded in 2016.

The last update, which came in August 2020, showed a "Fitbit-like" implant "working" in pigs, but we haven't heard much since -- and there' haven't been any scientific papers published in the meantime. Musk said new videos showing progress would be released in a month or so.

"We have a monkey with a wireless implant in their skull who can play video games using his mind," Musk said. Of course, there's no evidence for this, and it's the second time we've heard Musk discuss it. "Can we have the monkeys play mind Pong with each other?" he mused.

Consider that a caveat, though: Musk pulled it right back and made it clear these were long-term goals for the brain-implant device. The initial research focuses on how it might help those who have experienced brain and spine injuries.

"I want to be clear." Musk said, "the early applications will really just be for people who have a serious brain injury, like, where, it's like the value of the implant is just enormous."

One of the biggest stories in the last week has been the stock market, Reddit and GameStop's huge rally. But it was Bitcoin that Musk focused his attention on. "I'm late to the party but I'm a supporter of Bitcoin," he noted before turning his attention to Dogecoin, which had its own surge over the past week.

That cryptocurrency surged over 300% and reached an all-time high on Thursday, though Musk didn't seem particularly attached to it, beyond its comical nature.

"Arguably the most entertaining outcome, the most ironic outcome would be that Dogecoin becomes the currency of Earth of the future," he joked. Cryptocurrency tracker CoinDesk showed a small dropoff for Dogecoin's price immediately after Musk's comments.

Towards the end of the discussion, Musk rattled off a few things he's watching at the moment. We've thrown some of the quotes below.

Toward the end of discussion, Vlad Tenev, chief executive officer of stock trading app Robinhood, joined the interview to talk about the GameStop-Reddit saga, and Musk prodded him.

"People demand the truth," Musk said. "Did something shady go down here?"

"I wouldn't impute shadiness or anything like that on behalf of the NSCC," Tenev replied, referring to the National Securities Clearing Corporation.

It was typical Musk stream of consciousness, clocking in at about 90 minutes. Clubhouse couldn't keep up with the demand, and the conversation moved at a fierce, confusing pace. But it was weirdly entertaining? When Musk speaks, people seem willing to listen, and you never know where things are going to end up.

See also: Robinhood: What to know about the app at the center of the GameStop drama

Now playing: Watch this: Elon Musk's Neuralink demonstration in 14 minutes

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Elon Musk talks Mars, monkey brain implants and Bitcoin in Clubhouse interview - CNET

Bitcoin miners raked in more than $1 billion in revenue last month – TechRadar

Mining bitcoin is finally profitable again as new data has revealed that miners were able to bring in $1.09bn in revenue last month.

This is significant due to the fact that bitcoin revenue in January reached its highest point since December of 2017 before the cryptocurrency bubble crashed later that month.

At the same time, the revenue for bitcoin miners in January of 2021 also surpassed the level seen during the same time period in 2018 when miners were able to rake in $1.02bn. However, both last month and January 2018 failed to surpass the monthly revenue of $1.25bn for bitcoin miners recorded during December 2017.

Of the over $1bn in revenue made from mining bitcoin last month, $977m came from the network's block subsidies. These block subsidies increased sharply as the cryptocurrency's price jumped above $30k to reach a high of $42k.

Mining bitcoin has also become more expensive recently due to a bidding war for the latest ASIC mining equipment including Bitmain's AntMiner S19 Pro and S19. According to The Block, some customers who preordered the latest ASIC machines due to be delivered last month tried to resell them at premiums of at least 75 percent.

The supply shortage coupled with bitcoin's recent rise lead to miners' daily revenue per each terahash second (TH/s) of computing power increasing to as much as $0.25 which has not been seen since mid-2019.

If you have an unused bitcoin mining rig lying around, now may be the perfect time to fire it up again.

Via The Block

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Bitcoin miners raked in more than $1 billion in revenue last month - TechRadar

Bitcoin Rally Attracts Wave Of Private Investment As Leading Blockchain VC Raises New $120 Million Fund – Forbes

Bitcoin in Uncharted Territory. (Photo Illustration by Nik Oiko/SOPA Images/LightRocket via Getty ... [+] Images)

The bitcoin rally has seen the cryptocurrency climb to uncharted highs and this hasnt just been reflected in the markets. Away from the exchanges and OTC desks setting the price of BTC, private and institutional investor interest is growing at pace. Evidence of this can be seen in the growth of crypto venture capital funds, which have raised billions of dollars in 2020.

On December 23rd, Seoul-based blockchain investment group Hashed revealed that it has raised $120 million for its first crypto fund. The firm, led by CEO Simon Kim, intends to invest in disruptive blockchain startups including base layer protocols similar to Ethereum. According to Kim, the next wave of crypto networks will mark the start of the protocol economy, an era in which data and value is transmitted globally by crypto networks using a shared public ledger. He predicts strong government and institutional support for this new paradigm and has had no trouble selling out the groups first VC fund.

Accredited investors are limited in terms of the crypto assets they can trade, primarily consisting of BTC and ETH via regulated brokers and custodians. Blockchain funds provide an alternative way of gaining exposure to digital assets and the ecosystem they support. As bitcoin has broken new records, surging past $22,000, some investors are looking beyond the 12-year-old cryptocurrency to bootstrapping the next wave of blockchain networks.

Data from research group The Block shows a record $900 million was invested in blockchain startups in Q3 of 2020. Investors rushed to bootstrap decentralized finance projects in particular, including those focused on portfolio management, lending, and derivatives.

No one knows where Bitcoin creator Satoshi Nakamoto originated, with speculation placing him everywhere from London to LA. What can be said is that the movement he started, founded on blockchain technology, has become a borderless industry thats attracting major investment around the globe. In the U.S., Andreessen Horowitz subsidiary a16z was founded to seek out promising crypto startups, alongside firms like Pantera Capital and Galaxy Digital, led by veteran investor Mike Novogratz.

In Asia, meanwhile, Hashed is not alone in securing private investment to fund public blockchain networks. A number of cryptocurrency exchanges, including Binance and BitMax, have their own VC arms, tasked with nurturing next generation crypto companies. The symbiotic relationship often results in the same exchanges listing the native token of the projects theyve incubated once they reach maturity.

Its not just VCs that have sought exposure to blockchain either. Family offices and hedge funds have also taken an interest in the space. Harvard Universitys investment arm is one endowment fund that has already jumped into the crypto market, joining two other investors in an $11.5 million investment in crypto company Blockstack. Yale University is also known to have made a significant cryptocurrency investment.

Bitcoin is going through the early stages of a new asset class, from suffering early bubbles to attracting scammers with their get-rich-quick schemes. The frothiness of the market has been tempered by robust products that cater to a professional audience. Crypto is significantly more mature now than in 2017 when BTC last approached the heights it is now trading at. Today, the industry supports a healthy futures market, while enhanced options and custody have all anchored bitcoin while making it palatable to institutional investors.

Elon Musks flirtation with bitcoin, which has largely consisted of tweeting crypto memes to his 41 million followers, hints at a deeper interest in the digital currency. In a typically Musk-ian exchange on December 20, the Tesla CEO was encouraged by MicroStrategys Michael Saylor to follow his lead and convert some of Teslas cash reserves to BTC.

Are such large transactions even possible? pondered Musk, to which bitcoin bull Saylor replied in the affirmative, before offering to show Musk how.

Bitcoins low correlation to traditional assets has compelled some investors to rebalance portfolios that were heavy on bonds and equities, allocating a tranche to BTC. Bolder investors, however, are looking beyond bitcoin to the possibilities afforded by new blockchain protocols, where the risk-reward is higher, but so is the potential for outsized returns.

While institutional investors have been buying bitcoin, and investing in the industry thats formed around it, companies have been trialling their own blockchain solutions. Hashed has publicly supported Kakao, responsible for developing the countrys Klatyn blockchain, and LINE blockchain, owned by Tokyos LVC Corporation. Big Four accountancy firm KPMG, meanwhile, has expanded its blockchain strategy, supporting Microsoft, Tomia, and R3 in developing a solution for 5G network, and filing its own blockchain patents.

Against this backdrop of corporate innovation and private investment in blockchain, VCs have seen crypto funds fill up fast. This digital gold rush has prompted a booming business in picks and shovels - the tools and apps for interacting with the next wave of decentralized protocols.

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Bitcoin Rally Attracts Wave Of Private Investment As Leading Blockchain VC Raises New $120 Million Fund - Forbes

Bitcoins Rally Has Already Outlasted 2017s Epic Run – The Wall Street Journal

approached $20,000 in 2017 and finally topped the mark in 2020. What drove the rallies, and what happened in the days following the peaks, show how much the market has changed in three years.

The digital currency, which has more than tripled in price this year, hit its first record of the year 24 days ago and has continued climbing, trading as high as $24,273 on Sunday. On Wednesday, it closed at $23,299. In previous rallies, such gains have quickly reversed course.

Bitcoin bulls say the money fueling this years rally is coming from more reliable sources than past rallies. Since September, big new investors have collectively bought about half a million bitcoins, worth about $11.5 billion, according to analytics firm Chainalysis, which tracked the holdings of investors with at least 1,000 bitcoins in wallets that are less than a year old.

Notable buyers this year include billionaire investors Paul Tudor Jones and Stanley Druckenmiller, and companies like Square Inc., Microstrategy Inc. and Massachusetts Mutual Life Insurance Co.

There are more smaller buyers, too. There have been more than 38 million transfers this year of less than $1,000 of bitcoin into personal wallets, according to Chainalysis. That is nearly double the 20 million in 2017.

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Bitcoins Rally Has Already Outlasted 2017s Epic Run - The Wall Street Journal

The price of bitcoin is ‘driven by manipulation’: Nouriel Roubini – Yahoo Finance

Nouriel Roubini, professor of economics at New York University's Stern School of Business and CEO of Roubini Macro Associates joined Yahoo Finance to discuss his thoughts on bitcoin.

JULIA LA ROCHE: Welcome back to Yahoo Finance Live. We are joined now by Nouriel Roubini, NYU professor of economics at NYU's Stern. Nouriel, always great to have you on.

We'd like to share some breaking news that's just coming across. We're getting some headlines that President Trump has defied Congress and has vetoed the bipartisan defense policy bill. In some comments, Trump called the defense policy bill a, quote, gift to China and Russia.

And, of course, I know you're someone who does look at geopolitical events. And we are shaping up for a new administration in 2021. Your reaction to this news that's just crossing.

NOURIEL ROUBINI: Well, you know, I mean the president is becoming unhinged on everything. He's literally trying to do a military coup, following the advice of Mike Flynn and others, in order to subvert the results of the election.

He doesn't want to pass the stimulus bill. And if he doesn't, we may end up in a government shutdown. And now, he's accusing the defense bill of things that don't make any sense, you know. He has even denied that this major hack attack came from Russia. He claims that it came from China without any base. And if there is anything that actually can help us to push back against our strategic rivals, whether Russia or China or North Korea or Iran, it's going to be this defense bill.

So, literally, the guy is becoming completely unhinged across the board. It's just politics. Maybe he's trying to prepare himself to run again in 2024. Maybe he's losing his marbles. I don't know what's going on. But pretty much everything he's doing, it doesn't make any sense.

ADAM SHAPIRO: Nouriel--

JULIA LA ROCHE: Nouriel-- go ahead, Adam. You go ahead.

ADAM SHAPIRO: Go Julia. It's all you, Julia.

JULIA LA ROCHE: Well, I would like to shift the conversation, and thank you so much for sharing your thoughts on that, to cryptocurrency. Of course, Bitcoin. I think the last time we had you on, you got quite a bit of attention.

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I'm just looking at Bitcoin's price now. It's above $23,500. And you put out a tweet that Bitcoin has no place in an institutional investor or retail investor's portfolio. Yet we continue to see big name institutional investors kind of flood the space. Paul Tudor Jones, for example. Even Anthony Scaramucci. And then, we're also seeing the retail investors. Why does it not deserve a place in a portfolio?

NOURIEL ROUBINI: First of all, calling it a currency is not a currency. It's not a unit of account. It's not a means of payment. It's not a single [? numerator. ?] It's not a stable store of value.

Secondly, it's not even an asset. Either an asset has both income, use, and capital gain, like bonds, like stocks, like real estate. Or like in the case of precious metals, they don't give you an income. But gold gives you industrial use, it gives you [INAUDIBLE] as jewelry, and as a capital gain. While in the case of Bitcoin, there is no income, there is no use, there is no utility.

The only thing is a speculative self-fulfilling kind of rise. And that rise is driven totally by manipulation. There's been an academic study suggesting that these pseudo stable coin Tether is being created by fiat. This year alone, the increase in the supply of Tether has been another $16 billion out of the initial 4. So, it's 20. And every time the price of Bitcoin goes down, literally overnight they issue more of this Tether that is used literally to manipulate the price of Bitcoin.

So, the price of Bitcoin is totally manipulated by a bunch of people, by a bunch of whales. It doesn't have any fundamental value. And like in 2017, when it went from 1,000 to twice that, and then in '18 it crashed from 20,000 down to 3,000, I think we are close to the point in which this hyperbolic bubble is going to go bust. And it's going to go bust because law enforcement authorities are having an investigation of Tether and of the company behind it.

And in my view, like in the case of BitMex that was the biggest scam and criminal derivative cryptocurrency house has being indicted, you can have an indictment of those who are behind Tether. When that's occurring in the next few months, there will be a crash of Bitcoin and all of the other cryptocurrencies. They're not even currencies. They are shit coins.

ADAM SHAPIRO: Nuriel, I want to break this down in several parts. Because I think a lot of investors with Bitcoin at over $23,500 today need to pay attention. Why would there be, I'll call it a contagion, if the feds crack down on that other crypto, to Bitcoin? And how do you look at the fact that central banks worldwide are looking at creating digital currencies? Are they different than what we see with the Bitcoins and the other cryptocurrency is already out there?

NOURIEL ROUBINI: Well, there are several academic studies, including one by the University of Texas, that showed that every time the Bitcoin prices are weakening, there was an issuance of this Tether. There is literally a stable coin created out of Fiat. There has been no update that these cryptocurrencies are backed by any assets. And it's just printed by fiat used to buy Bitcoin. So, it's actually total price manipulation.

There's plenty of evidence that there are other schemes of manipulating cryptocurrency. There are pump-and-dump schemes, hundreds of channels on Telegram or on WhatsApp that is frontrunning, that is wash trading. Pretty much anything that is being done for penny stock is done for crypto and Bitcoin to the power of 10. That's a totally manipulated market. It's not driven by fundamentals. It's driven by insiders, by criminals, by whales, by scammers. That's the reality and there is evidence on it. And that's why there are criminal investigations that are going to reach their climax in the next few months.

Secondly, central banks are going to introduce digital currencies. But, first of all, these digital currencies will have nothing to do with crypto or blockchain. Today, every private commercial bank has a bank account with the Fed. We, as individuals, are [? non-corporational ?] are non-financial. We don't have access to the balance sheet of the Fed.

Suppose that tomorrow we have access to the balance sheet of the Fed. That's what a central bank digital currency means. It's not digital money. Digital money already has existed for decades. We have bank accounts, we have wire transfers, we have AliPay, we have WeChat Pay, we have Venmo. We have all sorts of other digital payment system.

So, what's new is not that it's going to be digital. There are thousands of digital payment systems that work all over the world. It's that we don't have a situation where individuals like you and me have access to the balance sheet of the Fed. Once we do, we don't need to have a bank deposit for making cheap, fast, instantaneous transactions that our payment system then clears and settled instantaneously. So, once we have a central bank digital currency, not only crypto-- this junk, these shit coins that don't have any payment use. But even other digital payment systems like bank deposit or Venmo and PayPal are going to be dominated by central bank digital currency. And this scheme technologically has nothing to do with crypto, has nothing to do with blockchain. It's going to be centralized. It's going to be permissioned. It's going to be a system that is going to be private, not on a public decentralized ledger.

So, calling it crypto is not true. It's a central bank digital currency. It's going to revolutionize payment systems and is going to destroy any pseudo cryptocurrency that is not a cryptocurrency and is not a currency.

The people don't know what they're talking about when they're talking about central bank digital currency. They get excited. They say even central banks are going to crypto. Just the opposite. They don't know what they're talking about.

JULIA LA ROCHE: Nouriel Roubini, professor of economics at NYU's Stern and CEO of Roubini Macro Associates. Always a pleasure to have you on. Wish you a happy holiday season. And thank you, again.

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The price of bitcoin is 'driven by manipulation': Nouriel Roubini - Yahoo Finance

Here’s Why I Won’t Buy Bitcoin, and You Shouldn’t, Either – Motley Fool

This has been a history-making week, and I'm not just talking about the rollout of coronavirus vaccines. On Wednesday, Dec. 16, we witnessed the largest cryptocurrency in the world by market cap, bitcoin, blow past its previous high and eclipse $20,000 per token. In fact, bitcoin went on to also blow by $21,000 and $22,000 within a matter of hours.

For as volatile as the stock market has been in 2020, you wouldn't know it by looking at bitcoin, which is up by 201% on a year-to-date basis through the late evening of Dec. 16. This jaw-dropping rally is rebuilding the euphoria that overtook the crypto community back in 2017, and probably has folks believing cryptocurrency is a good investment.

But I am not part of that community, nor can I say I ever will be. The higher bitcoin goes, the more convinced I am that it's one of the most dangerous investments. Each of the major buy theses surrounding bitcoin can be easily debunked -- as follows.

Image source: Getty Images.

One predominant catalyst for bitcoin is the perception of scarcity. It currently has 18.57 million tokens in circulation and a cap of 21 million. Over time, the remaining 2.43 million tokens will be mined via transaction proofing and block rewards. With only so many tokens to go around (fractions of a token can be bought and sold), the buy thesis suggests that this scarcity makes bitcoin an excellent investment.

The problem is that bitcoin lacks genuine scarcity. Its perceived cap of 21 million tokens exists because of computer code. Last I checked, code can always be erased and rewritten. While it's unlikely that a community consensus would be reached to increase the circulating supply of bitcoin, the possibility of this happening isn't zero.

By comparison, a precious metal like gold has a hard supply limit. We can't use alchemy to make more gold. The only gold that's available is what's been mined or is still underground. When the only parameter of scarcity is written computer code, that's not true scarcity.

Image source: Getty Images.

Another buy thesis of bulls is that bitcoin's utility is growing by the day. More businesses are accepting digital tokens for payment, and a broader swath of people are buying bitcoin tokens for the first time. According to financial services company Fundera, around 2,300 U.S. businesses and 15,174 global businesses were accepting bitcoin at the end of 2019. More than a dozen multinational companies also accept bitcoin.

Slam-dunk proof of increasing utility, right? Not so fast.

Even following its monumental rally, bitcoin has a total market value of $400 billion. That compares to approximately $142 trillion in global gross domestic product (GDP) in 2019. While it's true that not all GDP is consumption based, this $400 billion accounts for less than 0.3% of global GDP.

Furthermore, approximately 40% of bitcoin tokens are being held by long-term investors with no desire to put those tokens into circulation. Rather than having $400 billion in buying power, there's more like $240 billion in purchasing power available, accounting for 0.17% of global GDP in 2019. There are not nearly enough tokens in existence to drive widespread adoption, based on these figures.

As one additional note, there are about 32.5 million businesses in the U.S., including sole proprietorships. Removing these nonemployer businesses leaves 7.7 million companies with at least one paid employee, per the U.S. Census Bureau in 2016. According to Fundera, just 2,300 of these businesses are accepting bitcoin.

Face the facts: There's no widespread utility.

Image source: Getty Images.

Bitcoin bulls are also pretty convinced that the most popular digital currency is now a bona fide store of value: i.e., an asset, commodity, or currency that maintains its value.

Every month, the Federal Reserve is buying roughly $120 billion in government-backed debt. When coupled with the central banks' pledge to keep its federal funds rate at or near record lows, it's pretty evident that the U.S. dollar will be under pressure. Crypto investors believe that a ballooning money supply is a green flag for bitcoin to head significantly higher.

The issues I have with the store-of-value thesis are twofold. First, bitcoin isn't backed by any other asset or government. Therefore, it has no tie-ins or official relationship to the movements of the U.S. dollar. Implying that a ballooning money supply should push bitcoin higher is nothing more than a dart throw.

Second, store-of-value assets are designed to maintain their value over time and protect investors from volatility. Yet in March, bitcoin nearly lost half of its value in a 24-hour period. In 2018, the largest cryptocurrency by market cap shed over 80% of its value. In 2013, bitcoin lost about half its value in about six hours. This isn't how a store-of-value asset behaves.

The truth is, buying bitcoin is pure speculation.

Image source: Getty Images.

Bitcoin optimists will also crow about bitcoin leading the digital payments revolution. Going cashless could resolve the issues created by certain regions of the world being underbanked. Additionally, the blockchain technology that underlies bitcoin could revolutionize the payment processing and settlement time frame, especially in cross-border transactions.

While I don't disagree that a digital payments revolution is underway, or that blockchain could offer global financial and supply chain solutions, bitcoin isn't the vessel that's going to make this vision a reality.

The interesting thing about blockchain is that it can be tethered to multiple types of digital currency, be used in conjunction with fiat currency, or can operate independent of a tethered token. There's absolutely zero evidence that bitcoin is necessary to support a blockchain revolution.

To add, buying bitcoin tokens does not give an investor any ownership in the underlying blockchain. With no ownership in the solution that has the potential to actually drive this digital revolution, bitcoin investors are pinning their hopes on other investors being willing to pay more for a currency that exists only in computer code than they did.

So, why is bitcoin rallying? I'd surmise it's a combination of short-term emotions, technical analysis (i.e., pretty charts), and a grossly inefficient crypto market that overwhelmingly favors the buy side. After all, it's nowhere near as easy to bet against bitcoin as it is to bet against a publicly traded stock.

History has proved that sentiment can shift at the drop of a pin in the cryptocurrency space. I'd suggest investors keep their distance from bitcoin.

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Here's Why I Won't Buy Bitcoin, and You Shouldn't, Either - Motley Fool