Tag: bitcoin

Posted on by Tim Worstall

The US Dollar Is Used Because It’s Useful – Bitcoin Not So Much

There are those who insist that Bitcoin will become the predominant international currency at some point. That would require that it is actually useful to use as an international currency. For when we look at why people use the US dollar we find that’s why they use it – it’s useful:

If money could buy happiness: The determinants of utility of international currencies
Eiji Ogawa, Makoto Muto 26 July 2019

Given the US dollar’s historical prominence in international currency systems, it can be argued that a large part of its present-day importance is due to inertia.…

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Posted on by Tim Worstall

Seriously Folks, You Can’t Invest In Facebook’s New Libra – Not For A Capital Gain You Can’t

The Telegraph manages to ask the top stupid question about Facebook’s new Libra cryptocurrency, should you invest in it? The answer to which being obviously not, for it’s not something that’s going to have a change in capital value, indeed it’s designed not to. Thus investing in the hope of one is going to be something of a mug’s game, isn’t it?

But, you know, the numerate people and the journalists, ever the twain are split:

‘Sell Bitcoin… buy Libra’ – should you invest in Facebook’s new digital currency?

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Posted on by Tim Worstall

The Equation That Drives The Bitcoin Price

Now all we need to do is find the empirical values to plug into this equation. Even better, be able to predict them:

Speculation and the price of virtual currency
Wilko Bolt, Maarten R C van Oordt 14 May 2019

What drives the volatility of Bitcoin? This column explains a theoretical framework to link exchange rates to currency creation, speculative behaviour, and real growth in goods and services transactions. It suggests that the exchange rate will be less sensitive to speculators’ beliefs when a virtual currency becomes more established as a means of payment.…

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Posted on by Tim Worstall

Binance And The Bitcoin Heist Problem

Once again we’ve a story about a cryptocurrency exchange losing a decent enough amount of money to hackers. This time it’s Binance who say they’ve lost some $41 million worth of Bitcoin to hackers. The criminals were able to use phishing attacks to gain access, then they were able to access the hot wallet – the one actually in use that is, not the long term storage cold wallet – and so make off with the funds.…

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Posted on by Tim Worstall

Bitfinex, iFinex And Tether – $850 Million Isn’t Lost, Our Defence Is It’s Confiscated

We’ve long pointed out that cryptocurrency allows us to see every monetary and banking scam ever invented run past us at warp speed. Everyone’s learning the same old lessons that is. The latest has led Bitcoin to fall 5% in value just on the news let alone the proof.

The story as we can unravel it. iFinex runs the Bitfinex exchange, also Tether. Tether is a stablecoin, there should be a one for one deposit of a dollar for every coin issued.…

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Posted on by Tim Worstall

An Advantage Of Bitcoin – Escaping Government Mismanagement Of Money

This is of course the great promise of Bitcoin and crypto, that by not using government issued money one can escape the manipulations and mistakes of government issued money. That is though an argument for private money, or even competing currencies, not one necessarily for this specific technological solution. On the other hand, government might lose the ability to manipulate money and thus lose monetary policy:

Monetary policy in a world of cryptocurrencies
Pierpaolo Benigno 26 April 2019

Cryptocurrencies have attracted the attention of consumers, policymakers and the media.…

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Posted on by Tim Worstall

So Who Lost All The Money On Bitcoin? Masayoshi Son Of Softbank, That’s Who

So here’s a bit of fun and amusement. Bitcoin surged in price a while back. Then it fell in price again. Somewhere in that there’s going to be someone who bought near the peak and was left holding as the numbers fell back again. Who was that? Well, one identified is Masayoshi Son of Softbank. And what makes it all so piquant is that he was following the advice of a financial advisory company he’d just bought.…

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Posted on by Tim Worstall

Maybe India’s Right – RBI States Cryptocurrency Adds Nothing To The Economy

This new document from the Reserve Bank of India is less than an outright condemnation of cryptocurrency even while it points to officialdom thinking that way. Other actions also rather show the official disapproval of the new technology. And who knows, they might well be right. It’s not obvious or even apparent that there’s anything in cryptocurrency that is of great use to anyone.

That doesn’t mean that a ban is justified – there are plenty of things which are of no great use which we don’t ban, vide Simon Cowell.…

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Posted on by Tim Worstall

No, Really, Bitcoin Won’t Be Worth $1 Million Each In 10 Years Time

This is a fun float of a little prediction but the chances of it coming true are about as high as my dating Ariana Grande in a decade’s time. You know, indistinguishable from zero. For the posit is made that Bitcoin will be worth $1 million in a decade’s time. I’d put the changes of the entire Bitcoin universe being worth that as higher than each Bitcoin achieving that value.

But that’s what the latest director added to the PayPal board has just said:

One Bitcoin Could Exceed $1 Million in 7 -10 Years: PayPal Director

Hmm, well:

“In my (subjective) opinion those chances of succeeding are at least 50%.

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Posted on by Tim Worstall

They Would, Wouldn’t They? China Considering Bitcoin Mining Ban

China is considering a ban on bitcoin mining within the country. Quite how they’ll ban anyone connecting up a mining rig is, well, that’s for them to work out. The thing is, they would, wouldn’t they? For two entirely different reasons – and then there’s the third they actually mention. Bitcoin has been used as a rat run out of yuan, which isn’t going to please the government as they’ve been trying to keep that value nice and high.…

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