Bitcoin: Boom Or Bust; The Good, The Bad, And The Ugly Side Of The Crypto-Currency World
Yesterday, August 27, 2018, the financial media outlet, CNBC, aired a one-hour special on Bitcoin, and the cyrpto-currency craze sweeping the globe. For those who believe in bitcoin and the move to digital currency — their devotion and enthusiasm resembles a religious movement — Bitcoin evangelists, if you will. They believe in the currency, with their ‘body and soul,’ and they are swift and brutal in their criticism of those who raise questions about its current architecture. Those who faithfully support Bitcoin include: off-the-grid types and privacy advocates, individuals who are in oppressed societies, and yes, the darker angels of our nature. Bitcoin and the digital currency movement found an early ‘home,’ on the Dark Web, since use of the ‘coin,’ allows the individual to make purchases, etc., all the while staying anonymous. They also believe that it is only a matter of time before digital currency will replace most, if not all hard-currencies. A global payment system that….is the future. And, companies such as Microsoft, Overstock.com, and many others — real estate, escort services, etc., have begun accepting Bitcoin as payment.
There is a growing class of Bitcoin multi-millionaires, who invested in the early days of the coins beginnings back in 2009; and are “reaping the benefits of its stratospheric success,” CNBC noted.
The digital currency/Bitcoin is not tied to any one government, bank, etc., and runs on a technology called – BlockChain. Every time a Bitcoin is bought or sold, CNBC reported, the transaction gets recorded on the blockchain for everyone to see. So, theoretically, it’s incorruptible, and self-regulating. And, the Worldwide Web/Internet, allows the individual to move their digital currency — with a click of a mouse — instantly, anywhere in the world.
But. Bitcoin is far from the only digital coin in existence. Indeed, there are an estimated 1,500 different/individual digital coins, ranging from John McAfee’s Ethereum, to Ripple, LiteCoin, Neo, and so on. But, he who gets their first, with the most — often comes out on top, and Bitcoin got there first. It takes about $5,900-$6,000 to ‘mine’ one Bitcoin, or digital currency. The most popular digital currency exchange is the company, CoinBase, which says it has some 20 million individual customers, and as of the end of 2017, some $4 billion of digital coins were being traded on a daily basis.
And, the digital currency movement, as you may already know, has attracted the darker digital angels of our nature, who use the currency to hide their transactions, as well as other cyber thieves who have hacked into some digital currency repositories/individual holders, and conducted a digital currency heist. There is also a huge potential for price manipulation, since well over 90 percent of Bitcoin ‘currency,’ is possessed by one percent of the holders. A Bitcoin ‘whale,’ can artificially manipulate BitCoin’s price, by selling a big portion and thus drive the price down, only to do the opposite later. Digital currency scammers…..abound.
Other adherents assert that since digital currency/currencies are not tied to any one central authority/banks, nor government, crypto purists see it as a way to undermine and eliminate centralized powers altogether. A revolt against the status quo, CNBC noted.
But, not everyone is convinced. Rather than Bitcoin rocketing to $25,000 per coin, or as one prognosticator forecasts, $700K for one Bitcoin, Others remain very skeptical and see $100 per coin the more likely — eventual — outcome. The truth is probably somewhere in between; and, my bet is to the lower end, eventually near $100 per coin. The elephant in the room is the lack of regulation; which could eventually precipitate a government crackdown. The government will eventually regulate, and appropriate. Something that is anathema to digital currency believers.
So, at the end of the day, whether or not to buy Bitcoin or any digital currency depends on one’s risk tolerance, time horizon, and a full appreciation of the risk involved. This is a speculative genre, and one should not ‘bet the farm,’ or get too extended and throwing all your investment eggs into the crypto-currency basket. Could you get filthy rich by ignoring this advice and going all in? Of course; but, there is also the potential that Bitcoin goes bust, and ends up $100 per coin, after the government takes it over. After all, the government wants its share of taxes, and if it sees this domain as a way to avoid paying those taxes, then those same governments will work to either shut this currency down; or more likely, adopt and appropriate it. Buyer……beware. RCP, fortunascorner.com