Loading ...Bitcoin Has No Top Because Fiat Has No Bottom: Understanding Monetary Debasement
Good article, but wrong conclusion. Yes, “Bitcoin has no top because fiat has no bottom.” However, unless one ultimately uses the Bitcoin to convert into real money, gold and or silver, then the Bitcoin is just as worthless as fiat.
That is why he is wrong about going back to a gold standard. So what if the central banks have gold, as long as individuals are also allowed to own it. If that is really a problem then use a silver standard instead or both.
It worked fine in the US, UNTIL they created the Federal Reserve. Instead of focusing on the ratio between gold and silver only, we need to focus on the ratio between each of them vs bitcoin. https://www.zerohedge.com/crypto/bitcoin-has-no-top-because-fiat-has-no-bottom-understanding-monetary-debasement
The reason Bitcoin is hyped and promoted constantly on social media and financial TV networks is because the price of it is reliant on the story around it. Its success is based on faith and nothing else. It essentially requires the public’s increasing religious adherence in order to stay afloat and continue its increase in market share.
The people who promote it tout its scarcity. The problem with this is, since it has zero real-world utility outside of a digital exchange medium, the scarcity of it is meaningless. Who cares if you have a limited amount of nothing? Even if there were only 1,000 bitcoins, it wouldn’t matter because nobody and no industry needs them to perform their work.
Another problem is the 21,000,000 limit, which will supposedly be reached around 2140, is a problem for bitcoin that bitcoin advocates don’t want to talk about. Anytime you bring it up they go silent. This is because bitcoin requires miners to perform mining operations in order for transactions to clear, but after 21,000,000 bitcoin have been produced miners will no longer receive any bitcoin as a reward for those mining operations. Their only reward will be in the form of transaction fees. Now if you know anything about bitcoin mining and how much it costs, you will understand that in order for this mining to be worthwhile, those transaction fees will need to be astronomical. This will make exchanging bitcoin prohibitively expensive for the user.
Bitcoin proponents also denigrate gold as if it’s just like bitcoin, but in physical form instead of digital. They pretend as if the jewelry industry doesn’t exist, that people don’t buy gold bracelets, necklaces, rings, watches, etc., that Tiffany & Co. isn’t a legitimate business because it buys gold to produce real products that people buy for non-monetary use. They also ignore all other industrial applications for gold such as its use as a reflective medium and as a sensitive electrical connection medium, They ignore all of this because they can’t admit that gold has a function and role in the marketplace outside of a store of wealth and monetary asset. This would expose the fact that gold is a real commodity and bitcoin is a series of numbers in a digital ledger, and nothing more.
You are correct and stated many of the points I have made before about Bitcoin and included a few more. You also stated them in more detail and quite eloquently. Thanks for doing so.