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re: Why bitcoin is worse than a Madoff-style Ponzi scheme

Posted on 12/26/21 at 1:33 pm to
Posted by JimMorrison
The Peninsula
Member since May 2012
20747 posts
Posted on 12/26/21 at 1:33 pm to
I think a big misconception is that crypto is billed as currency, but in its present form and how the population interacts with it, it's really just an investment. The main reason people buy it is to hope for a return.

I've invested and profited from crypto, but I don't see a future without government regulation if it was truly to be used. Once governments step in, the game completely changes and the crypto community seems to disregard any potential negative impact from this regulation. Everyone turns a blind eye and doesn't even consider the fact that their coin can depreciate. I've had people tell me the Fed is too stupid to create their own blockchain network and basically render any current project useless.

I'm interested to see how crypto reacts in 2022 with the rate hikes on the horizon because crypto is treated like a high growth asset, but the difference between a high growth company and crypto is that crypto fundamentally has no backing to support its price. Crypto and the stock market have both greatly benefited from QE the past year and a half so we'll see how it plays out.

Digital currency is the future, but I'm not sure why any current project would be used by a major central bank and I don't understand how people are so steadfast in their opinion that their coin has no downside risk, especially at current price levels after the run up.
This post was edited on 12/26/21 at 1:46 pm
Posted by TigerTatorTots
The Safeshore
Member since Jul 2009
80840 posts
Posted on 12/26/21 at 3:22 pm to
quote:

Digital currency is the future, but I'm not sure why any current project would be used by a major central bank and I don't understand how people are so steadfast in their opinion that their coin has no downside risk, especially at current price levels after the run up.

I don't think any major central bank would take up bitcoin in the short/medium term. If you have a strong (relative to the rest of the world) currency, it would only hurt you in the short term. We know government agencies do not think long term. I foresee small/poor countries that get fricked out repeatedly by the IMF and world agencies turning to bitcoin first. El Salvador is going to be the test case. I'd bet my life that there are many other small impoverished countries watching it closely.
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