Short Bitcoin. I could be wrong but I am an expert on digital assets and investing. BTC is not a currency and will likely never become one; it is less stable and more inflationary that the worst third world government backed currency; it is merely a decentralized freeware cloud app (like Venmo?), that helps people wire money anonymously via credits (that are equal to dollars at any moment, but fluctuate dramatically by the minute in the opaque market of scammers).

The current “share” price is based on the narrative that it will become legal tender in the future, and replace the dollar to some degree; but right now, there is no evidence whatsoever. Due to the dramatic people hyping it and the pace of its rise, I think the opposite.

In fact, the world’s biggest proponents won’t accept it as payment; you cannot buy a Tesla with Bitcoin, which makes sense because they don’t want to be arrested for money laundering, nor does anyone else. And they don’t want to be caught holding the ball when it drops. Stripe and others used to accept it and settle it, but they stopped; in other words, it has become less liquid as it has been hyped upwards.

You have to assume that Bitcoin holders will get disproportionately audited also, and any misdeeds uncovered, further tainting the hackable app that has no leadership, and has a hundred governments and banks capable of offering a more competitive service quickly, that will pass government scrutiny and gain broader global public acceptance, endlessly diluting BTC’s theoretical value; because those new apps are not being used by criminals and are backed by permanent safe brands and governments.

Usually, the first mover doesn’t make it; ever heard of MySpace, Netscape, Palm, Betamax?

The Bitcoin growth narrative is riding an enormous wave of hype, called “irrational exuberance” in financial markets, like we have seen dozens of times with other random assets in the economy (gTLDs, tulips, Enron, gold), similar to a game on Wall Street (like GameStop?), but with a lot of cool and unique features in the app; which does not make it a currency. Ask The Fed.

Also keep in mind “Past performance is no indicator of future results” for any asset, especially those that have risen precipitously.

We know how financial games end, when they become rationalized.

People are lining up to use Bitcoin and to “invest” in it. But can you actually safely invest in something without stock, a board of directors, a business plan, an accountant, a lawyer, and government oversight?

The current spot price to get credits is based on the idea that those credits will become even more usable, liquid, and valuable, and gain broad acceptance as a reserve currency, presumably due to first mover advantage; but there are no sustainable advantages other than a powerful brand, great code and ideas, waiting to leap to the high level its “investors” are fantasizing about. If a bitcoin loses value you can’t do anything with it, including wire it. However, great domain names can be used to bring in customers forever, and generally go up in value every year. Gold can be used for jewelry and sold in the gold market.

Is BTC usage just a realm for international thieves, and therefore will be done growing as an investment once they are done climbing on board, and everyone safe is off?

Invest safely unless you think you have “mad money” and don’t mind taking the risk of it disappearing. If BTC actually does become a legitimate government backed phenomenon in the future I would reconsider, but that is highly unlikely in the foreseeable future.

Also, if Amazon and the other tech oligarchs did accept it as payment, that would be equivalent to a government and would create massive liquidity and upticks, but it will still have the other problems to contend with; the big boys accepting it is a fantasy at the moment.

Good luck in your adventures. Don’t do anything I wouldn’t do.

2017

“Could be a bubble ….similar to tech bubble from 90s. Totally irrational. Goes through development process. Will be around in 10 years, and more useful but who knows what the price will be.” Nick Colas/ Datatrek

“problem with cryptocurrencies is they’re not currencies..no demand, cant pay taxes”

Paul Donovan UBS

“If you have no electricity and you have no wifi you have no currency” -Dwane

“Scam for criminals around the world; has no credibility” -Neil Dwane/Allianz

“The only value of bitcoin is what the other guy will pay for it” -Dimon

“Don’t care how trades, if stupid enough to buy it you will pay price one day.” Dimon

“Could trade at $100K before it goes to Zero” Dimon

“Tulip bulbs once traded for $75,000.” -Jamie Dimon/MS

“Bitcoin is an index for money laundering” -Larry Fink

Other bitcoin notes:

April 18, 2022

Bitcoin is slipping a little recently; and much lower than its highest point; but criminals can still launder mega-millions with it as long as it maintains some stability. However, that will eventually lapse as confused speculators learn more about the history of economics; and simultaneously many people are prosecuted for tax evasion and other crimes with it; which will create significant bad press, and all groups running for the exit at once. The price has no basis in reality; will eventually revert to its fundamental value of almost nothing; a collectors’ item. No math, no proforma, no leadership, no backing. All hype and racketeering and confusion. Get out while you can.

March 2, 2022

Bitcoin is a way of wiring money anonymously when there are no good traditional options, mostly illegally; it makes no sense to leave the money in the wire; which has no intrinsic value unless you convert it to cash; however, it is possible people could believe it has value for a long time, and be fooled in to keeping the price propped up accordingly; keeping in mind that no good alternatives have been created by any government banks. Most likely it will just crash though. Short.

April 12 2022

The entire price rise and support of Bitcoin is because it is unregulated and anonymous; therefore, insider owners of it (including media people who own it) made up crazy stories, causing ever more speculators or mistaken believers to keep propping it up higher. Won’t last. No fundamental value.

Jan 10, 2022

Bitcoin has always just been a huge unregulated fraud and ponzi scheme. The tech is OK, but obsolete and irrelevant. It’s a sad commentary that Bloomberg and other reporters (and real investors/gross profiteers); plus Musk, Saylor, Wood, Draper, own(ed) some, and lie about it incessantly with no consequences. Sell it all before you lose it all.

The post Bitcoin Reality appeared first on Fearless Leaders.

5/27/2022 Mike Mann

Venture capital firm Andreessen Horowitz said it “formed a new $4.5 billion fund that will invest in cryptocurrency and Web 3 companies.”

Their founder, Marc Andreesen, is one of the smartest people in Silicon Valley ostensibly, having invented the web browser when he was in college; then investing in some of the best technology companies and profiting handsomely.

But Marc has advisors and partners, notably in this case “the a16z crypto team”, and it is possible if not probable that taken in whole their egos, greed and self-confidence have led their minds and investments out of the mainstream of the conservative investment community, now making undue, absurd bets by mistake (as opposed to consciously making rational, traditional investments.)

For example, investing in ‘crypto’ is nuts, where they have lost about 50% in the last year, despite the earlier hype cycle having taken them and their investors upwards, mostly in their ‘Coinbase’ investment. I wonder if they have any of their personal funds on the line, or it is 100% investors’ risk, with AH getting fees no matter what, and sharing in any potential upside.

Here is what the world’s smartest financial people think about investing client funds in crypto: https://qz.com/1089740/what-the-worlds-financial-bigwigs-think-about-bitcoin/

Ostensibly ‘crypto’ actually stands for ‘cryptography’ which is merely a small growing subset of the overall software programming marketspace, which itself is suffering with the rest of the extremely broken Biden economy, and is unlikely to advance in the near future.

They have around $7 billion of investor money on the line at this point. So even if the crypto marketspace were legitimate, which it is not; and even if the economy was good, which it is not; and even if they were great stock pickers, which they no longer are, then it would still be an incredibly risky investment, and highly unlikely to pay out in the long run.

In the short term it could be anyone’s guess what happens with these spaces. AH doesn’t even proclaim they are investing in cryptography per se; it is actually even much more cryptic. In their press release the investments are stated as “cryptocurrency” and ‘Web3”. The latter has some chance if they are super careful in their selections, but not the former in my estimation. (Check back here in a couple years to find me being correct again.) These investments include the incredibly risky and hurting areas of “blockchain gaming, decentralized finance (DeFi), decentralized social media and non-fungible tokens (NFT).”

The flip side of this equation is that venture capitalists often make out big time on a few of their overall investments, making their many losses appear inconsequential. I guess this is possible, but still too unlikely and risky to bet on it. Short.

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