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Desire to take control away from Central Banks sounds right but ability to print money at will doesn't.
If you think BTC doesn't have any function, how do we justify the price of gold or for that matter how do you afford value to a currency note which our governments PRINT AT WILL.
Trading: Primarily Energy but also a little Equities, Fixed Income, Metals and Crypto.
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I didn't say it didn't have any function, you just assumed that because I didn't agree with you.
Gold is a physical resource, not something conjured out of thin air. It's also one of several commodities viewed as a storer of value. Comparing Bitcoin to Gold is interesting, because Gold isn't viewed as a currency. While I see how Bitcoin could be viewed as a store as well, how can that be so, given that whenever a bunch of chinese miners decide to, it forks leaving you with something different than you started with (and wanted)?
While I agree Fiat Money maybe has its issues, the US Dollar is backed by the good faith of the US Government, whether you believe that to be valuable or not. (Most of the world does and since you still reside in the US I assume you do as well). Most (all but 1?) cryptocurrences are the other hand are backed by nothing. And while the Governments do print money at will, currently people create new currencies at will also.
Getting back to my question, if you don't know which one is going to be the winner isn't the almost $200B market cap of Bitcoin a little surprising?
Trading: Primarily Energy but also a little Equities, Fixed Income, Metals and Crypto.
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NYT :- Worries Grow That the Price of Bitcoin Is Being Propped Up
A growing number of virtual currency investors are worried that the prices of Bitcoin and other digital tokens have been artificially propped up by a widely used exchange called Bitfinex
...
In recent months, however, many investors have been raising alarm bells about Tether. Hundreds of millions of dollars worth of new Tether were created; almost always when the prices of other virtual currencies were heading down. The Tether were used on the Bitfinex exchange to make big purchases of Bitcoin and other tokens, helping push their prices back up, according to multiple analyses of data from Bitfinex.
If previous crashes in BTC/USD which accounted typically for +/- 80% before going to new highs are any indication
that means that we still have plenty of room to go down, more precisely to +/- 4000
In other words, "I have consumed a large amount of electricity, and therefore I am (and should be) rich." Of course, I do understand that what matters is that the electricity was used to power computers running cryptographic programs, and is not the same as electricity that is just burned up to run lights or something. (Although running lights is inherently useful, while running crypto algorithms is not....)
The reason that this puzzles me is that bitcoin, etc., uses an analogy to mining gold or another metal as the basis for the currency's value: a certain amount of mining backs a certain amount of currency. Yes, it is hard to make it, and therefore it is going to be scarce, and yes, there is a demand for it, but the real-world resources that are going into the stuff is just electricity and computer time.
I think this is stretching the mining analogy pretty thin.
There is a "libertarian" rationale for the backed-by-mining idea: the currency is not created by government "fiat" and therefore is independent of arbitrary government actions. But it is created by my fiat (and that of others) if we just buy a lot of electricity and run enough computer hardware. It is no less artificial, and frankly is pretty arbitrary.
Sorry to get on this rant, but I still have trouble with the basic idea that it takes "mining" to make it, and therefore it is a good idea for a currency.
This is separate from whether the current market is or is not in a bubble, although the oddity of the currency's "backing" suggests that, in actual fact, the price is based on nothing in particular except buyers' enthusiasm.
