Topic: Bit Con? Veteran fraud expert sets his sights on bitcoin (Read 4980 times)

Yes, this should be stressed.  With all the misinformation and bias out there, it's good to see some people basing their decisions on facts (this one is not proven but has some reasonable statistical backing) and their own philosophy.  I've come up against this at several points and usually honestly recommend the person to some major fiat (which, for all its faults, is currently more evenly distributed with respect to individuals) and/or to check out NEM (an altcoin focused on egalitarianism).  This doesn't bother me, but it does seem to be a deal-breaker for many.

This is not the typical latecomer.

A number of early adopters have invested a huge amount of time and effort into Bitcoin.

Finally, many early adopters hold more bitcoins than latecomers and therefore, quite clearly, have much more to lose.


Again.  He's assuming that Bitcoin will fail and that latecomers will be punished by the Bitcoin experiment.  I honestly believe that Bitcoin has a chance to succeed.  In this case, the true latecomers benefit because they invested no time, effort, money in building Bitcoin and took no risk but can still benefit from the shiny new payment system simply by buying/earning the bitcoins (at a fair price) and using them.

Also, there are many genuine actors in the markets you listed above but most of these markets do include systemic foul play.  Here I refer to the blatant fraud in trading claims to a commodity but where the number of claims far exceeds the available quantity of said commodity.  The reason I classify it as systemic is basically because government is involved, legitimising the fraud with regulations and favours for selected entities.  This is not presently the case for Bitcoin.  Perhaps the closest analogy in the Bitcoin world was Mt.Gox with their goxbucks and while this was undoubtedly fraud on a large scale, it was not systemic.  Mt.Gox was not vital to the Bitcoin system; it was not "too big to fail" as witnessed by the fact that it did fail yet Bitcoin is still with us and as vibrant as ever.


It's true that if Bitcoin does die then everyone involved will lose something, but it's also true that the more heavily invested will lose more.  Early adopters are typically far more invested than newcomers and are far more attached to the concept (so if Bitcoin does head to zero, they will hold on for longer).  Also, several early adopters have invested time in aquiring Bitcoin-specific knowledge and skills, and while not totally valueless absent Bitcoin, they would be seriously diminished and cannot be sold in a panic.

I think Robinson is very much suggesting a huge "intentional con" (tautology: con implies intent).  At least, if his position is that there are some bad actors in Bitcoin but that, by and large, the experiment is an honest attempt to create a new form of money, he sure screwed up with the choice of book title "BitCon".

As I claimed before, I think his opinion is particularly potent and emotionally stirring for newcomers now because their experience of Bitcoin has been one of a constant bear market (just as Cameron Winklevoss' $40 000 opinion captured the imagination of many newcomers because Bitcoin had been in a ferocious bull market for the past year).  There is genuine despair among many newcomers that bought at much higher prices and they'll grasp at any seemingly plausible explanation which makes them the victim, from "miners selling", to "BitPay merchant adoption".  The reality is that they bought in on hype and only have themselves to blame.

A lot of markets are based on the Greater Fool theory, Bitcoin too, nothing new here. But then again, what has intrinsic value for people? Food, shelter only... anything else is demand pent up by skillful marketing. But even demand for shelter can be overheated as we've recently witnessed.

One of the most intriguing fact is this

When you know that there’s, what, 13 million coins in circulation, and more than 50% of the them are owned and managed by about 950 people, you realize how shallow the market it is and how subject the market is to manipulation

sadly some of the facts stated are indeed true to certain extent. I believe a lot of bitcoin fanatics will take this as an offense but sometimes whether we like it or not facts are still facts

I don't doubt that as the bubble finally bursts there will be a lot of fanatical early adopters and hodlers that will lose their shirts. And I don't think Robinson is suggesting an intentional con; it's all very natural

if you want to study the stupidest people on earth, he is the perfect case study (speaking of the "thing" holding the glass)...

"In summary: Jeffrey Robinson is assuming systemic foul play on all levels and predicting a win:lose outcome where the early adopters cash in at the expense of the latecomers."

like with stocks, bonds, gold, silver, land, oil...hmmm 

It's already a miracle that this guy can hold his glass alone... and it isn't a joke.

http://www.amazon.com/BitCon-Naked-Truth-About-Bitcoin-ebook/dp/B00NUIUQ3A

I don't seem to recall any early adopters selling their house for BTC. Latecomers have much more to lose than early adopters.

Ok, I guess you're referring to this excerpt.


Firstly, I'm going to outright disregard the market manipulation remark as FUD.

As for the shallow market and small number of large holders, this stems directly from the fact that Bitcoin is less than 6 years old.  For much of that time, extremely few people cared about Bitcoin at all.  The market is deepening and the coins are spreading with time but significant change here will take many years.

Some argue that the early-adopter hoarders retard adoption; that many people would buy into Bitcoin if only the distribution were "fairer".  Setting political philosophy aside I'd just point out that Bitcoin has seen breathtaking surges in adoption each year.

Then he describes Bitcoin as a pump-and-dump scam.  To be fair, I see a lot of ardent evangelism, and it vexes me.  Some people do seem to care more about Bitcoin becoming popular than about the people they are marketing it to.  But these promoters are not pump-and-dumpers, quite the opposite in fact.  Many of them have had an epiphany regarding Bitcoin and fallen in love with it.  Far from dumping, they intend to become wealthy by being relatively large holders of a new and vital money.

As for the Winklevoss twins telling people that Bitcoin is going to be worth $40 000, the actual quote is:
Again, Jeffrey Robinson is twisting words.

There are plenty of newcomers losing money on Bitcoin.  They are not doing due diligence and are taking the statements of the friends which introduce them to Bitcoin on faith.  These friends are not in most cases scamming, they honestly believe what they are saying and are simply excited.

In summary: Jeffrey Robinson is assuming systemic foul play on all levels and predicting a win:lose outcome where the early adopters cash in at the expense of the latecomers.  This is a particularly potent opinion given the current bear market but it is just an opinion.  My own opinion is that most participants are operating with good intentions and that there's a potential win:win outcome (a major, corruption-resistant money that anyone may freely use).  In the event of a catastrophic failure, I expect hoarders and early adopters to be the chief bag holders (especially when invested time is factored in) while latecomers receive little more than a slap on the wrist.

There was a bit about the uneven distribution of coins and the subsequent fleecing of n00bs I found sort of hit home tbh

A self-important authoritarian that has allowed his own preconceptions to cloud his judgement.  I found none of his points to be well-reasoned or convincing.  I was more put off by the choice of language; the bias bordering on outright lies being disguised as facts.  A case in point:
He links here to support his claim, but almost all the quotes are basically answering "not yet" to the question of whether or not bitcoin is money (some "yes"s and some "no"s thrown in).  One big name on the list:
So no, it is most certainly not the case that "actual Austrian economists say that bitcoin doesn't matter".

Is there a particular point of his which is causing anyone here trouble?

Only trully valid point from this dude is about current bitcoin distribution. Those guys who hold bags of coins should come forward and pump part of them slowly in market.

100% correct. He says Bitcoin has no value, but then he says the blockchain is real and he agrees he can see all the things it will enable, how does he think people will pay to use those services? Western Union? Visa? Post office money order? He missed the whole point of Bitcoin being the means of payment. Thats why it's treated like a scarce commodity. Only 21 million will ever be available to be used to pay for all the services that will be available on the blockchain.

It is not stuff I like to hear, but he raises many points that have been nagging me, in the back of my mind, for a long time now. after this dissapointing year (post crash from ath) I'm more and more inclined to side with him, even though I know how he likes to stir the pot for attention.

Bitcoin's use as a currency does seem to be very low on the list when development enters the discussion. Question is; what would the $ value of Bitcoin be if it found another use?

Anything to sell a book huh.

http://nakamotoinstitute.org/mempool/everyones-a-scammer/

"Fortune spoke with Robinson about the year he spent researching bitcoin and why he thinks the currency will ultimately dissolve into worthlessness. "

If he spent an entire year studying (I doubt it) and still thinks bitcoin will dissolve, he's managed to attain Paul Krugman levels of stupidity and short-sightedness.

Not what I want to hear tbh after investing over £5,000 on BTC now.

I read the article and he does bring some valid points to the discussion. I fear he may be right about the part where the little guys who invested in BTC will get hit hard while the big fish profit.