Sunday , November 17 2019
Home / argentina / Bitcoin: unfulfilled promises from the most famous cryptocurrency – 12/29/2018

Bitcoin: unfulfilled promises from the most famous cryptocurrency – 12/29/2018



Bitcoin is 10 years old, without many things to celebrate. Officially launched on January 3, 2009, the most famous cryptocurrency He failed in all his promises: it does not function as a means of payment, or reserve value, or as a reference unit for valuing goods and services.

On the contrary, Bitcoin lost last year was more than 80% of its value, with sharp ups and downs and cornered by criticism and warnings about its speculative nature and not being transparent. Last month, economist Nouriel Roubini he called it clearly "fraud".

Roubini was the one who accurately predicted the 2008 crisis, which began with the fall of Lehman Brothers. Immediately after, on October 31 of that year, "anonymous Satoshi Nakamoto" distributed the document on the theoretical basis of bitcoin, postulated as an alternative to legal money, free from central bank and government regulations.

Figure Satoshi Nakamoto.

Figure Satoshi Nakamoto.

The exit to the market is generated, initially, more curious than worried. Price, said the promoter, is determined by supply and demand and changes at any time for reasons that cannot be determined. Over the years, the cryptocurrency also failed to erase suspicion about high price volatility. Without going further Last week the bitcoin ranged between US $ 3,400 and US $ 3,800, all for no apparent reason. In December last year, the alarm sounded.

That month, Bitcoin reached a record US $ 19,783 and then fell below US $ 6,000 and rose again to US $ 9,000. Investors, economists, banks and regulatory agencies from several countries, including the US. and Europe, warned about the risks of investing in bitcoin and other "virtual currencies" (more than 1,500 today) and the lack of special regulations.

Some Nobel Prize recipients disqualify Bitcoin as a substitute for money and define it as truly speculative practice.

Joseph Stiglitz, for example, said that bitcoin did not fulfill "useful functions" and stressed that "the real reason why people want alternative currencies is for money laundering or tax evasion." For Roubini, "it's a typical financial bubble: people don't buy it to use it in transactions, but because they expect it to increase the price ".

Beyond what happens in the future, bitcoin never prospered as a means of payment, the main theoretical foundation of the experiment. Famous investor George Soros pointed out that "currencies that vary 25% a day cannot be used to pay salaries."

The main attraction, the critics agree, is the possibility of obtaining quick profits in a way that allows online buying and selling anonymously, without needing to state the origin of funds or pay taxes.

At the end of January, the British prime minister, Theresa May, acknowledged that her country was learning to organize the activity. "We have to take cryptocurrency very seriously, like bitcoin, precisely because of the way they can be used by criminals." For the same reason, Stiglitz asked to ban it.

Cryptocurrency is pierced. (Reuters)

Cryptocurrency is pierced. (Reuters)

Another economist and Nobel bubble expert, Robert Shiller, said that cryptocurrency is a "natural Ponzi scheme", as the pyramid scheme called like that of Bernie Madoff, was discovered and stopped by the FBI in late 2008. Just when bitcoin appeared on the scene.

Paul Krugman explains what a Ponzi scheme is and its close relationship with cryptocurrency. "As long as everyone continues to buy (bitcoin) everything is fine, but the latter will lose all the money and no one thinks that they can become them," the economist said in January.

The logic of the bubble was studied and occurred several times throughout history in various markets, with tulips, property, mortgages, shares, and internet portals.

This phenomenon begins with an increase in the price of assets that are uncontrolled and end with raids and general disturbances. When bitcoin is around US $ 20,000, Shiller predicted that "prices will rise, like the stock market in the 20s," but clarified that "we will reach 1929 with time."

Scholars, on the other hand, magnets are recognized by virtual currencies. He said that bitcoin "is an interesting story" and its fans consider themselves superior. "You are fast, you are smart, you have found what others don't understand and have anti-government and anti-regulatory feelings. That is an amazing story, if that is true", He interprets.

Basics of operating the bitcoin digital currency and the work of "miners" - AFP / AFP Bitcoin cryptocurrency digital virtual currency

Basics of operating the bitcoin digital currency and the work of "miners" – AFP / AFP virtual digital currency, bitcoin cryptocurrency

But there are other disturbing sides in the future of the virtual "currency". Tel Aviv and Tulsa university investigations revealed the computer robot artificially raising the price of bitcoin from US $ 150 to US $ 1,000 in 2013. According to the study, maneuvers were carried out automatically through the Mt.Gox platform, which broke out the following year in an embarrassing way because of the alleged robbery.

Mt.Gox operates in Japan and is one of the largest bitcoin buying and selling operators in the world. In 2014, the company suddenly stopped operating and its manager declared a loss of US $ 473 million. The CEO was arrested and charged with fraud and embezzlement. And finally released on bail, in 2016. There are other similar cases, charged with theft and hacking of cryptocurrency exchange portals, including Japanese Coincheck and Korean Coinrail.

Last Friday, at the end of this edition, bitcoin traded below US $ 3,700. Your future is a question. The most enthusiastic followers suggested that it was time to buy, because of the "cheap" price. The critics, more and more, highlight the risks and lack of cryptocurrency support.

In a column published in the Financial Times, another economic Nobel laureate, Jean Tirole, argued that "bitcoin is an asset without intrinsic value and the price will drop if trust decreases". He added that "it is a real headache for anyone who sees public policy as a necessary complement to the market economy."


Source link