Money has to be the most marketable commodity, not lines of code on a hard drive. Investors in the latter are finding that out the hard way.
Bitcoin is now down 24% this year and remains roughly 47% below its October all-time high.
The largest failure so far this year has been Blockfills, a midsize prime broker that halted deposits and withdrawals earlier this month amid the decline in bitcoin prices.
Bitcon … the digital enigma wrapped in a digital riddle
I’ve lost count of how many videos I’ve watched or columns I’ve read that attempt to explain what bitcoin is, and how it works. To this day I still don’t understand how the hell it works, which is why I’ve never dabbled in the stuff. Sure, I wish I had gotten a few coins a decade or so ago, but I sleep better at night knowing that cash is still king. …….er, at least for now. lol.
Knowing that the US’ DARPA had an experimental project called LiveLog where they developed a website to capture all connections and social activity in a person’s life, which was “coincidentally” shut down right as the private website Facebook launched, I always had trouble believing the Bitcoin origin story of some Japanese developer who didn’t want to reveal his identity.
I am a bitcoin investor. Bitcoin has always been volatile and it has had these crashes before. This isn’t even the worst one. It seems to be part of it’s nature as it matures. Sure, it’s annoying and even somewhat worrisome if you let it get to you. The poster says ‘money should be a marketable commodity’. Well, the problem with our regular form of money these days is that it is suffering the same fate as all previous FIAT currencies. They get devalued to worthless over time because of excess borrowing and money printing. The CDN dollar has lost almost 24% of it’s domestic purchasing power since 2015. That is almost a quarter of it’s value in only ten years! That is the main reason everything has become so expensive. The U.S. dollar is in even worse shape as it has lost almost 28% of it’s purchasing power in the same time frame. The massive debt load shouldered by these two currencies cannot be repaid and continues to get larger every year. Neither government is even trying to pay off that debt. It is indisputable that both of those FIAT currencies are crashing to worthlessness just like in the Weimar Republic or Zimbabwe. Why are so many people still keeping their wealth in a continually depreciating asset? Bitcoin will bounce back just like it always has done in the past although sometimes it takes a year or even several. Major corporations and countries around the world have bitcoin holdings. It’s not going to disappear. The bitcoin fearmongers always love to knock it when it’s down when they should actually be buying the dip. After it climbs again they will once again be regretting that they didn’t. Like Michael Saylor said recently, “If you want to ride the rocket, you’ve got to be prepared to pull the Gs.” The U.S. and Canadian dollars do not have a future. I (and many other people) believe bitcoin does have a future. Since it cannot be printed into infinity by governments it is certainly a worthwhile consideration. Realize that each bitcoin can be divided into 100 million ‘satoshis’. The future will see many things being bought and sold in satoshis. Full bitcoins will only be used in the very largest transactions.
You’re largely correct on FIAT currencies, but Bitcoin is a distraction, and as noted below, is not the secure asset once thought to be.
As we see, PMs are the way.
What are the Big Banks and National Financial institutions doing to secure their financial security? Well, they are not buying Bitcoin.
Gold. Silver. Those Barbarous Relics, that’s what. We live in a world of cycles.
Please explain to me why Bitcoin crashed when PDJT announced his choice for The Fed? A man sure to lower interest rates which will unleash renewed investment in our economy? So Bitcoin investors FEAR a healthy US economy?
Yeah, Bitcoin and all other crypto currencies are traded on FEAR. I’m sorry … but I just don’t live my life in a permanent state of FEAR … ultimately FEARING that good things might happen.
Three big problems.
1. Can’t hold it in your hand. Bitcoin isn’t independent of all systems. It has a dependency unlike precious metals, which we can bury in the back 40, securely.
2. Epstein is dead. He was heavily involved in Bitcoins outlay. Go Figure. Was he Santoshi?
3. Quantum computing can decipher and decrypt blockchain technology. Seems like a SMALL SECURITY ISSUE.
Yeah, the PMs shine again. The smart people bought cheap junk silver and silver coin when it was $20 or less per ounce.
If you listen to Michael Saylor (of Strategy) the assumption is that Bitcoin will go up 30-40% per year on average, forever. I’m reminded of Cathy Wood whose ARK Investments went up forever … until it didn’t.
Same as Thought Criminal,do not understand Bit Coin,cannot see it,carry it,hold it ,bury it.
And without electricity??
Precious metals are more my speed,as they have monetary value..
You can hold them in your hand,you can hide them from “the man”and you ignore the fluctuations,for fait money always fails.
however,should our “Dear Leaders” succeed in causing systemic failure..precious metals will be worth less than base metals.
When it all falls apart,copper jacketed lead becomes essential.
In such circumstances Lead,with a small sampling to tin,is also priceless.
So how low will we go?
Depends how long we continue to tolerate the fools and bandits.
Once again my favorite saying “Perception Rules The World’ comes into play in this discussion. If you think about it almost everything we own or hold is subject to that rule and many, if not most, people are not really aware of what an effect it has on the value of our ‘wealth’. For example, a good friend of mine bought his current house here in Calgary in 2006 for $429,000. His recent tax assessment from the City of Calgary says it’s taxable value is $660,000. My friend believes that figure is low and thinks his house is worth about $750,000 give or take. So he thinks his house has gained $321,000 in ‘value’. But has it really? Realizing that his deposit on that house in 2006 was made up of money earned and valued in mostly more valuable 1980’s and 90’s dollars let’s disregard that for a moment and just use the value of the CDN dollar as it was in 2006. The CDN dollar has lost 34% of it’s purchasing power (value) since 2006. So to properly declare the increase in ‘value’ of his house we first need to reduce that 750,000 figure by 34%. Therefore his house is worth $495,000 in 2006 dollars. When you take into account house insurance, house and property repairs and property taxes over the last 19 years has he made any money? He would have been better off renting and investing in a diversified portfolio. It is ,however, true that the act of buying a house and paying it off is a form of forced savings.
Another good current example of an incorrect perception of value is with the Canadian dollar itself. Most Canadians look at the value of the CDN dollar compared to the U.S. dollar to judge the current strength of the dollar and therefore the economy. The current exchange rate shows the CDN dollar fluctuating between .73 and .74 to the USD. Most of us have seen the CDN dollar worth between .75 and .85 to the USD dollar many times before and think hey, things could be worse. But it IS worse. We are now comparing our CDN dollar to a U.S. dollar that has lost 28% of it’s value since 2015. So our current CDN dollar is only worth 73% of a very weakened and failing USD! No wonder everything is so expensive now. Whether it be things like houses, cars, or our FIAT currency it’s actual value is often different than it’s perceived value. As more people realize that their perception of the value of their owned goods or their CDN (or USD) in their bank accounts is a misperception and incorrect the dollars will actually depreciate faster as people try to switch their wealth into something else. Yes, precious metals have historically been a good storage of wealth over the long term. . Plus, unless you plan to whittle off some gold or silver shavings to pay for groceries you are forced to deal with precious metal dealers to get devalued FIAT money in return in order to buy things. Those dealers are charging people a percentage (sometimes exorbitant) to take their gold and silver. Yes, bitcoin’s value is also subject to the rule of perception but it is an asset that has cap of how many can actually be produced for one thing. Bitcoin is also slowly being accepted in the marketplace and we are already using our phones to buy things digitally. I can see that happening with bitcoin but it’s hard to see it with gold and silver. One more thing. Think of one bitcoin as a huge denomination of a currency. Like a million dollar bill. Remember that there are 100 million satoshis in one bitcoin. I truly believe that people in the future will look back at these times in amazement that a whole bitcoin could be purchased for only about 89,000 Canadian dollars. As much as I dislike the current devaluation of bitcoin I know it will bounce back and I know the CDN and USD Fiat dollars will not. Sorry for the long post.
The part I like the best: Trading real money for an empty paper bag, only there’s no bag.
I don’t buy the PM argument. IMO it’s no better than Bitcoin…. If things get that bad, the most valuable commodity will be Brass and lead. You can’t eat your PM and Bitcoin, and if it’s so bad that their is no power…. Nobody will give a flying F about your PM. If there is power, then bitcoin, ether, etc will likely be as valuable as PM. On a seperate thought, bitcoin regularly drops over 50% during big crashes…. So for holders it’s no big deal, just a time to buy more. As for PM holders….. Horde all you want… But remember that if it gets really bad, you would be better of melting it onto bullets.
Yeah, when the economy collapses it’s better to have lots of food and other necessities both on hand and stashed away. Freeze-dried food lasts a long time.
As Pavel says, guns and ammo would be an absolute necessity.
But don’t forget things like first aid items, flashlights and lots of batteries, camping stoves or other cooking means such as a kindling-fed Swiss army stove. You can also make an alcohol-fueled stove from a beer or pop can (I’ve done it just to give it a whirl).
And while you may find some people willing to trade certain goods for your PMs, you’re more likely to come across folks desperate for things like booze and cigarettes, so stock up on them.