There hasn't been anything approaching real mania yet. 2013 probably happened off the backs of a few tens of thousands of people dotted around the globe. If it experienced dotcom levels of bubble then people would be left gasping.
As ever people are concentrating on the price of one unit and forgetting how few of them there are overall.
Overall though I'm not disagreeing with the article in the short term. They're all valid points. People won't be using it as a safe haven, apart from the foaming hard core, for many decades yet. It has a whole lot of proving to do.
If it does iron out the kinks then I can see large swathes of people taking it on. And I only know one person who owns any gold. I know an awful lot more who use the internet and internet banking.
Topic: [2016-08-11]Here Is Why Internet Currency Bitcoin Will Never be Digital Gold (Read 346 times)
August 11, 2016, 07:58:32 PM
August 11, 2016, 06:47:26 PM
I disagree with that article in part and here is why:
That article records some interesting ideas, but I am not convinced of its accuracy in the area of "details". Just for the sake of controversy lets explore the main contrast it depicts. Bitcoin vs Gold for storage. I am going to assume that readers on this forum have some familiarity with Gold. It is physical and can be held, but because its physical what if I wanted to send some of my Gold to someone across the world. Since they are in other countries it becomes bothersome to try and convert it to my local currency and then they would have to swap for their local currency when my payment arrived. OR even more bother is to figure how to physically transport Gold without it disappearing or bearing the huge expense to protect it all along the path. Even if I never moved my Gold I still bear the burden of making sure it doesn't get stolen, and also the burden of how to sell small amounts to receive goods and services when I actually want to use Gold to better my life by acquisitions. I actually do both Gold and BTC. I fear that in the scheme of things if the world economy (or my local economy) were to collapse, protecting Gold from theft is not going to be a small challenge. If I walk around with Gold in my pocket to buy food at that point, I am begging for a worst case scenario to present itself.
Enter Bitcoin: not a physical thing but power over it is controlled by the private keys to addresses in the blockchain. Its so easy to move, quick, and very secure if the user possesses the skill set. A thief cannot steal BTC physically and an advanced user can pretty easily prevent digital theft. It is not tagged to one Gov't or currency so its basically universally of value. It can be moved anywhere in the world in a few seconds, in the sense that the blockchain is universally available on the globe. Instant value transferred to another owner in seconds, and anywhere in the world. Protection so much better than physical commodities. Simplicity; in that the smallest fraction of a btc can transfer ownership to a seller, whereas with Gold if you have an ounce but only want to spend a few bucks what do you do with it? That article is correct in that it demonstrates the perils of btc under the supposition that users will remain clueless and avoid mainstream thinking. Once over time BTC inches out into mainstream it just makes sense. My Trezor (there are other fine hardware wallets out there too) makes uses btc secure and as easy as "plastic".
That article records some interesting ideas, but I am not convinced of its accuracy in the area of "details". Just for the sake of controversy lets explore the main contrast it depicts. Bitcoin vs Gold for storage. I am going to assume that readers on this forum have some familiarity with Gold. It is physical and can be held, but because its physical what if I wanted to send some of my Gold to someone across the world. Since they are in other countries it becomes bothersome to try and convert it to my local currency and then they would have to swap for their local currency when my payment arrived. OR even more bother is to figure how to physically transport Gold without it disappearing or bearing the huge expense to protect it all along the path. Even if I never moved my Gold I still bear the burden of making sure it doesn't get stolen, and also the burden of how to sell small amounts to receive goods and services when I actually want to use Gold to better my life by acquisitions. I actually do both Gold and BTC. I fear that in the scheme of things if the world economy (or my local economy) were to collapse, protecting Gold from theft is not going to be a small challenge. If I walk around with Gold in my pocket to buy food at that point, I am begging for a worst case scenario to present itself.
Enter Bitcoin: not a physical thing but power over it is controlled by the private keys to addresses in the blockchain. Its so easy to move, quick, and very secure if the user possesses the skill set. A thief cannot steal BTC physically and an advanced user can pretty easily prevent digital theft. It is not tagged to one Gov't or currency so its basically universally of value. It can be moved anywhere in the world in a few seconds, in the sense that the blockchain is universally available on the globe. Instant value transferred to another owner in seconds, and anywhere in the world. Protection so much better than physical commodities. Simplicity; in that the smallest fraction of a btc can transfer ownership to a seller, whereas with Gold if you have an ounce but only want to spend a few bucks what do you do with it? That article is correct in that it demonstrates the perils of btc under the supposition that users will remain clueless and avoid mainstream thinking. Once over time BTC inches out into mainstream it just makes sense. My Trezor (there are other fine hardware wallets out there too) makes uses btc secure and as easy as "plastic".
August 11, 2016, 02:28:06 PM
Bitcoin may be the new big thing in global currencies, but don't count on it replacing the old, boring store of value, now or ever.
New paradigms often create market bubbles. They are a new technology or idea that will change the world and, along the way, offer investors unlimited profits.
Mania soon takes hold as prices detach from reality and people get rich, at least on paper. The mania soon fades, though, and before long prices fall, sometimes dramatically.
https://www.thestreet.com/story/13670599/1/here-is-why-internet-currency-bitcoin-will-never-be-digital-gold.html
New paradigms often create market bubbles. They are a new technology or idea that will change the world and, along the way, offer investors unlimited profits.
Mania soon takes hold as prices detach from reality and people get rich, at least on paper. The mania soon fades, though, and before long prices fall, sometimes dramatically.
https://www.thestreet.com/story/13670599/1/here-is-why-internet-currency-bitcoin-will-never-be-digital-gold.html
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