Tag: Is Bitcoin Dead

Bush May Be Dead, But Crypto Isn’t

By Mason Mohon | @mohonofficial

The news is in, and crypto is apparently dead. Again. After reaching a peak of nearly $20k in December of 2017, Bitcoin has been on a steady decline, ready to end 2018 at a far lower point than it began it with. With Bitcoin has gone every other major cryptocurrency. They are all on a steady decline, and those that invested at the all-time-high are most definitely on some kind of suicide watch.

Some drank crypto kool-aid. The storm of ICO’s that were probably scams caused a lot of people to lose a lot of money. Never forget BitConnect.

On a Reddit forum dedicated to the discussion of Bitconnect, one person published the number of a suicide charity whilst others made the astonishing (and probably untrue) claim that crime syndicates were now looking to exact revenge on the people who launched the cryptocurrency.

The broader public sees BitConnect’s scam/death as the inevitable fate of crypto. The mainstream hasn’t hesitated to bury it six feet under with our former president and move on. Bitcoin and cryptocurrency make little to no waves on the mainstream media anymore. I have even wondered to myself if it is truly dead.

But then I remind myself that Bitcoin (and the crypto market) has finished a year lower than it started before. 2014 was a year much like 2018.

Dead Before

I wondered if the same doomsday tales were told back then before I was into crypto. A quick Google search that limited the search parameters to late 2014 and early 2015 revealed a treasure trove of news articles. History truly does repeat itself.

My favorite of these is a Washington Post article titled “Bitcoin revealed: a Ponzi scheme for redistributing wealth from one libertarian to another“.

Bitcoin hasn’t just fallen 76 percent the past year. It’s fallen 36 percent the past two days, as you can see below, with a 24 percent decline the past 24 hours. It’s too bad Bitcoin doesn’t have a central bank to help stabilize its value.

What in the name of Satoshi Nakamoto is going on? Well, two things. First, Bitcoin’s big bubble has been slowly deflating for over a year now. It has no inherent value, after all, because, despite companies trying to get free PR by saying they’ll accept it, almost nobody uses it to buy anything other than drugs. Second, though, is a problem that’s all too familiar to anyone who tried flipping condos in Miami ten years ago. Bitcoin miners, you see, borrowed money—and real money, as in dollars—that they could only pay back if Bitcoin prices kept rising, or at least didn’t fall this much.

Those silly drug dealers and miners have multiplied their investment by around 20 times since that article was written, even despite Bitcoin’s seemingly low price. The crypto doomsday has yet to come. CNN Business had a similar thing to say:

If they handed out awards to financial assets like they did to movies, then Bitcoin would definitely be the winner of the Razzie for worst currency.

The problem is that some fans of Bitcoin seem to think that it is also something that could be a good investment.

CNN published this in 2015. I audibly laughed when I read that line. These same doomsday sayers are back, and once again they are ready to tell us the grim news that it is doomsday. A finance professor explained on MarketWatch:

I explained what it would take for bitcoin to become worthless. Bitcoin is getting close to that point. As I argued, once Bitcoin’s price falls below its cost of mining, the incentive to mine will deteriorate, thrusting bitcoin into a death spiral. That is, without the mining activities supporting the ledger that maintains the records of who owns what — bitcoin is, after all, a set of encrypted numbers that cannot establish the ownership of anything — bitcoin will become worthless.

This is the exact same argument that the 2015 CNN business article made. And look how accurate their prediction was.

The best way to destroy your credibility when it comes to new markets like that of cryptocurrency is to say its over when the party has barely begun. And although we’ve handed out a few appetizers, the party has still barely started.

Broken Money

The United States, as well as the entire global economy, has based itself on debt. We surround ourselves with negative value. We prop up one house’s foundation on another shaky house. The monetary elites are doing something very wrong.

The entire system of Keynesian economics is based around piling up short-run problems in the long run, because after all, we’re all dead in the long run. An economic downturn is a market correction because malinvestment happened. But instead of letting the market correct itself, the state decides to inject a new stimulus package and allow for more malinvestment to occur. This covers for the immediate issue, but it only pushes the inevitable collapse further into the future. They stack up, the soon-to-come collapse only gets worse.

The problem with the system is quite obvious. But the scientific gloss of Keynesian mainstream economics makes it more appealing for academia. Thus, all of our generations economists don’t know better. And this is why crypto is necessary.

The man behind the curtain will soon be revealed. And when that happens, there will be a demand for something else. It might be gold. It might also be cryptocurrency. But there is going to be an alternative.

The Comeback

Binance CEO Changpeng Zhao is optimistic about the future of cryptocurrency. Even though the crypto market value shrank from $800 billion to $200 billion this year, Binance reported record revenue. The cryptocurrency exchange reported making over $3 billion in the first half of 2018.

CZ (Zhao’s nickname) thinks that the community needs to put things in perspective. Although things are grim compared to January, the market is booming when compared to two years ago. CZ stated:

Even if I don’t know what will catalyze a bitcoin bull run, I am certain it will happen. Sooner or later, something will trigger it.

Furthermore, Fred Wilson, a notable venture capitalist, made clear that the cryptocurrency community should look to Amazon to realize that all is not lost. During the 1999 tech bubble, Amazon was trading at $90/share. When the bubble burst, though, it plummeted down to $6/share. It took about 8 years for the stock price to recover.

Now, Amazon is the second largest tech conglomerate, sitting right behind Apple. Wilson explained that cryptocurrency could be in a similar position:

So while crypto asset prices are down 80-95% in USD terms over the last year, they could and probably will go lower. Amazon was down 80% a year into the post-bubble bear market and it got cut in half again before it made a bottom almost two years after it peaked. What we have yet to see in crypto land is when they kick you when you are down. And that is certainly coming.

I think some crypto asset (and possibly a number of crypto assets) will have a price chart like Amazon’s current one in 18 years. But we will have to do what Amazon did, hunker down and build value and survive, for quite a while to get there. And I think things will get worse before they get better.

But those who stayed were rewarded, although it took a long time for that to happen. We didn’t see meaningful paydays in the Internet sector until the 2007-2008 period and the big paydays didn’t start coming until 2010 and beyond.

You can’t just jump ship when the going gets tough. That looks like selling at lows and buying Bitcoin at $19k. It’s a really bad idea, and FOMO should never guide investment if the asset is already at the moon.

Bitcoin, blockchain, and the other crypto assets have promise. Their applications range from libertarian revolution to crypto anarchism to business decentralization to gambling away your college savings. The future is on its way. Are you going to buy a ticket?


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Bitcoin Floor Falls, Bottoms at $5600 USD

By Ryan Lau | @agorisms

Shortly before noon on Wednesday, Bitcoin took a major downturn. After remaining (relatively) stable in the low to mid $6000 USD range for several months, the cryptocurrency plummeted to a mere $5600. This represents roughly a 10% drop in value instantly.

In its history, Bitcoin has shown greater jumps in both directions. However, this breach following a period of stability is relatively unprecedented.

Wednesday’s price marks the lowest Bitcoin exchange in over 12 months, dating back before the surge to nearly $20,000 USD in December of 2017.

Shortly before the drop-off, analysts had mixed expectations on the future of Bitcoin. Some expected the prices to rise modestly, exceeding the $7000 USD mark in the near future. But other analysts were less optimistic. Crypto analyst Willy Woo, for example, believes that market will not bottom out until sometime in 2019’s second quarter.

Individual Twitter users, on the other hand, were not so sure of either solution. In a poll that Woo posted, there was no clear consensus on Bitcoin’s forecast. Some users believed that the bottom was here, while others believed there was more to fall first. Interesting, a plurality actually conceded to not having any idea what would happen next.

The market downturn is not exclusive to Bitcoin. Other cryptocurrencies, such as Ethereum, have also seen considerable losses. Wednesday morning, the altcoin opened above $200 USD, but by noon EST, it was a mere $180.

Since the fallout, Bitcoin has recovered slightly, returning to a value of $5805 USD before falling once more to $5730. It is likely that today, as well as the near future, may lead to a continuation of this morning’s volatility.


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Bitcoin Is Not Dead

By Spencer Kellogg | @TheNewTreasury

Contrary to popular belief: Bitcoin is not dead. It’s just sleeping a bit. And perhaps it deserves some rest given the parabolic and insatiable rise in valuation and adoption it has seen in its less than 10-year existence. Think about that: 10 years. In the history of money, 10 years isn’t even the blink of an eye. We are still in those early drunken stages of undisciplined poking about in which everyone is set to knock around the darkened room of questions until we find a door that leads us to the next confounding labyrinth. In truth, we haven’t even seen what this thing is capable of yet.

Over 6,000 years ago, humans first developed a system of market exchange: bartering and trade. Seashells, stone tools, teas, salt, spices and anything else that could provide an agreed upon value was used for the peaceful exchange of goods. Horses were domesticated and became a living currency to many of the native prairie nations that roamed the American southwest. It wasn’t until 600BC that King Alyattes of Lydia minted the first currency, a coin of gold and silver with a lion’s head on the front. Today, the mobile phone credit M-Pesa is used successfully as a unit of exchange in the nation of Kenya. Currencies are diverse and linger most reliably in the eye of the beholder. The-First-Coin-2.jpg

– King Alyattes of Lydia Coin

What is a currency? In the Mike Maloney’s brilliant “Money vs. Currency” YouTube series, he defines a currency as “a unit of account that is portable, durable, interchangeable, and divisible.” From its inception, Bitcoin has attempted to answer each one of these demands through an encrypted network of peer to peer users working in a global, peaceful, and pluralistic system of equals. It strives to help humanity in a way that asserts an individual’s right to life, liberty and the pursuit of happiness in face of crushing multi-national governments and banking entanglements that far too often overlook the majority’s interest in favor of wealth and power stratification.

Bitcoin is not nearly as anonymous as it probably should be and the speed/costs of using the technology are still too high in relation to other already viable payment options, but these are issues that are constantly discussed and addressed within the community. Sathosi Nakamoto’s currency requires time to reach a consensus and in many ways, this is how all great democracies have functioned; through anxious debate and slow lumbering changes. Tyrannies are those that are built behind bayonets in the dusk of an economic collapse.

In the Genesis Block of Bitcoin, there was a coded message. It read: “The Times 03/Jan/2009 Chancellor on brink of second bailout for banks.” Created on the heels of the 2008 financial disaster, Bitcoin was a universal, internet-based alternative currency that rejected both the predatory boom and bust cycles of global Keynesian economics and the ‘injection of cash’ theory that modern governments asserted as they bailed out underperforming banks, mortgages and car companies along the way.

CXyH3c0WEAAbs9C.jpg

– The Times of London Newspaper January 3rd, 2009

Today, the United States national debt stands at a staggering 21 trillion dollars and growing. That’s roughly $64,000 dollars for every single American. For what? So that Bank of America could swallow up a few regional branches here and there? So that Chrysler and General Motors could go on making cars? So that we could torch and murder our way through entire nations only to find the chief architect of 9/11 hiding behind shining palace doors in the US-allied nation of Pakistan? I remember people losing their houses, the country is $21 trillion in debt, millennials are saddled with student loan debt and yet the stock market keeps rising. See anything wrong with the picture? Our leaders are happy enough to forget that any of this ever occurred. They are on to the next fundraiser in Iowa to bang the podium for a fat check. It’s all a farce!

What happens when the bill comes due though? Who do you imagine will pay the price? It will be the global majority of underpaid and overworked servants who are expected to answer the call. The ones who ride the ever-growing line between lower and lower economic classes will suffer most. The men and women who are shipped off to meaningless wars made possible by the various centralized banks of untouchable power and wealth. It is always the already weak made weaker by bloated, selfish governments who suffer the final, eager blows. Whether under the crushing weight of a religious text or the pervasive dogmas of 20th-century neoliberalism, the uber-elite of modern governments have held the final say.

Until Bitcoin. Yes, that Bitcoin. That decentralized, peer to peer, free market, global equalist, anarcho-communist, radical syndicalist, definitionless Bitcoin. We, as a global community, have overlooked it again. The real reason we all ended up with private wallets and paragraph long seeds: freedom. The freedom to opt out of the federal reserve notes that have provided the ultra-capitalist lifeline to an empire of war after war while the dollar devalues with greater certainty each passing quarter. Next, they tell us we must build a great military industrial complex in the sky. We just want bread.

This movement is not about the Hong Kong mansion parties. It’s not about crypto famous edgelords who may or may not have received an airdrop in their ether wallet. It’s definitely not about tacky, gaudy, ugly, pompous, gross Lamborghinis either (at least go for an Aston-Martin for God’s sake). Bitcoin is about what we are witnessing in Venezuela where citizens have turned to the cryptocurrency as a store of value while their own nation’s currency has become completely worthless over the course of one year. The people of Venezuela were neutered by a neo-socialist government that did not care for its people’s wellbeing. With Bitcoin, at least the people of Venezuela have the option of another way. rgplbYc8ClSqfqlrGYQSRebtrCg4wRRpjMreNOevEAo.jpg– Genesis Block Of Bitcoin

The cryptocurrency community is in a sort of collective paralysis at the moment. Somber and gossipy, it’s tripping on a heady mixture of hedonism, jealousy, emptiness, and outright fear. Many were later to the game than they really wish to admit and the general consensus feels bearish. For now. The same greed and power that Nakamoto hoped to disembody have manifested themselves into the community where market vampires and juvenile venture capitalists have accrued en masse. They have unlearned, or never learned, the core narrative of Bitcoin’s original intent: a rebellion.

An American and a Russian and a Kenyan and a Columbian and a Pakistani walk into a bar and they all enjoy the same cold beer. That was always Bitcoin’s mission. Not fame or fortune but to bring differing peaceful people to the same beautiful table of ideas. To sit them down and show how much they each have in common with one another when the brutal nationalism of war and economy have been stripped away. To forge a new and humane way forward. The only question is if we are strong enough to do it.


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