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Is bitcoin in a bubble?
The price of bitcoin has been soaring this year, and last week alone it jumped from $11,000 to well over $17,000, according to Coindesk. It started the year below $1,000.

That rocketing level of appreciation smells a lot like an irrational investor mania to many economists and financial pros, the kind that sent prices for unprofitable startup internet companies soaring in the dot-com boom. Those prices eventually came crashing down.

“We saw this in the 1990s,” says Barry Ritholtz, chairman and chief investment officer of Ritholtz Wealth Management. “Any of those things sound familiar? ‘This is unique, this will change everything?’”

Like many others in finance, Ritholtz expects the bitcoin bubble to pop. The only question is when. “Some people think it’s early days, some people think it’s late,” Ritholtz said. “We’ll find out in the not-too-distant-future who is right.”

Robert Shiller and Joseph Stiglitz, two Nobel-prize winning economists who’ve seen their share of speculative manias, recently have called bitcoin a bubble. Stiglitz went so far as to tell Bloomberg TV that bitcoin should be “outlawed.”

Bitcoin was created in hopes it would become a new kind of currency that people could use outside of the traditional banking system, without backing from any country or central bank. It was also supposed to operate outside of government oversight, which has raised concerns that it will be a haven for criminals.

How to get rich off bitcoin — or lose it all while trying 
Unlike traditional currencies, bitcoin doesn’t have a country backing it, a central bank, interest rates, or a long history of exchange rates against other currencies, making it extremely difficult to place a value on. Its value is tied only to what people believe it’s worth at any given time.

Despite the growing interest, bitcoin still is not widely accepted in stores to buy merchandise, and you can’t deposit it at a bank. One of the problems with using it as a currency is that its value keeps bouncing around, sometimes very suddenly.

“We have seen bitcoin more as a speculative investment rather than an equivalent to cash,” says J. Craig Shearman, spokesman for the National Retail Federation, the world’s largest trade association of retailers. “Even if it were a foreign currency, you need to dependably know what the exchange rate is, and bitcoin doesn’t meet any of those tests.”

Backers of bitcoin say it’s about time for a new kind of currency that can be exchanged in private and secure ways.

Its promoters include internet entrepreneurs Cameron and Tyler Winklevoss.

This week mainstream financial markets are for the first time allowing investors to make future bets on the direction of bitcoin, but bitcoins themselves will continued to be traded only on private exchanges, which are mostly out of reach of regulators.

Mark Fratella, a teacher who lives in Elmhurst, Illinois, bought some bitcoin “for the novelty of it” back when it was worth $700 or $800.

Fratella is holding onto his bitcoin, and buying a little more from time to time. He’s also buying other cryptocurrencies, such as Ethereum and Litecoin. He’s heard the talk of a bitcoin bubble.

Bitcoin futures rise as virtual currency hits Chicago Board Options Exchange 
“But I have also seen a few analysts talk about how, in the grand scheme of things, there are a relatively low amount of people into bitcoin and there is a huge potential for growth,” he said. With the futures trade starting, Fratella thinks people who have been leery of its decentralized, deregulated nature will start buying into it too.

The futures also give investors the opportunity to “short” bitcoin — that is bet that its price will go down — which presently is very difficult to near impossible to do.

While the value of bitcoin itself may be inflated, even some of its biggest critics say that the technology that’s behind bitcoin has promise. That technology is called blockchain. It’s a kind of digital ledger that securely records transactions and prevents the same bitcoin from being spent twice.

Jamie Dimon, the head of JPMorgan Chase, has called bitcoin “a fraud” that will eventually “blow up.” But Dimon also said he thought the blockchain technology was “good” and could be used to make transactions faster and easier.

For now, people keep buying bitcoin, even with all the talk of a bubble. To Ritholtz, the enthusiasm is a combination of the novelty of bitcoin, the built-in scarcity of it — only 21 million of them will ever be created — and the psychology of people being attracted to assets whose prices appear to keep going up.

“One of the first rules of investing is, only invest in things you understand,” Ritholtz said. “If you want to speculate in a cryptocurrency and you don’t understand it, you might get lucky for a while but those sorts of speculations don’t work out well.”




alfwesh22

Saxo Bank global macro strategist and famous Bitcoin bull Kay Van-Petersen has said Bitcoin prices will hit “$50,000 - $100,000 within the next six to 18 months.”

Speaking to Bloomberg in a short interview, Van-Petersen explained that the influx of institutional money would be the “catalyst” in pushing Bitcoin prices even further.

“We’ll get a cascade of ETFs, mutual funds and other investment vehicles breaking out,” he forecast, describing the $100,000 price tag as a “prudent” prediction.

Not just Bitcoin, but other cryptocurrencies could “do better” in terms of price growth from the same phenomenon, the analyst continued, highlighting Ethereum as a possible next contender specifically for ETFs.

“The astonishing thing - mind-blowing if you will - is that you take a step back and look at the price appreciation… a lot of this has happened without traditional institutional money, and that’s basically going to be coming on board over the next six to 18 months,” Van-Petersen continued.

As Bitcoin continues to go well beyond any analyst’s expectations for short-term growth, even the most hardline proponents are being left to wonder what could be next.

Even Van-Petersen’s own prediction of a $100,000 Bitcoin within 10 years, which he delivered in May, now seems less surprising.

Bitcoin prices have recovered since CBOE’s futures successfully launched, with exchanges currently eyeing $17,000 per coin after a drop below $13,000 over the weekend.




alfwesh22

Japanese conglomerate GMO Internet Group has introduced a payroll system to allow its 4,700+ employees to receive part of their salaries in bitcoin.

GMO Introduces Bitcoin Salary Payment System

 
Japanese Internet Giant GMO Lets 4700+ Employees Receive Salary in
            Bitcoin  

Japanese Internet leader GMO Group has announced that its employees can start receiving part of their salaries in bitcoin beginning in February of next year for the March pay period. This option will initially only be available to employees of GMO Internet Co. Ltd but it will gradually extend to the entire group, the company detailed in its announcement on Monday. According to the company’s website, GMO Internet has 4,710 full-time employees as of September this year.

The company also listed 42 subsidiaries on its website which are part of the GMO Group. They include GMO Coins, the company’s cryptocurrency subsidiary, and GMO Click, one of the world’s largest FX platforms.
In order to facilitate salary payments in bitcoin, the company explained:
The GMO Internet Group has decided to introduce a system that allows part of the salary payment to be received as bitcoin in order to promote ownership of our domestic employees’ virtual currency.
The minimum bitcoin payment will initially be 10,000 yen (~$88) and the upper limit will be 100,000 yen (~$881).

Each salary payment in yen will be reduced by the amount of bitcoin payment paid, using the exchange rate at the GMO Coins exchange. Employees who create an account at the GMO Coins exchange “can receive bitcoin on the same day as their payday,” Nikkei described.

GMO Promoting Crypto From Within
Following the launch of its cryptocurrency trading platform in May, GMO announced in September its plans to begin a mining business. The company plans to spend 10 billion yen in the next few years to build a mining farm as well as to research and develop 7nm, 5nm, and 3.5nm mining chips. In October, GMO announced that it plans to sell mining boards equipped with 7nm chips using token sales.

Japanese Internet Giant GMO Lets 4700+ Employees Receive Salary in Bitcoin 

In Monday’s announcement, the company stated, “The mining business is currently preparing for the start of business beginning in January 2018.”

“The GMO Internet Group will contribute to the development of virtual currencies in the world by promoting efforts related to virtual currency throughout the group,” the company noted, adding that:
In order to further strengthen these approaches to virtual currency, it is important for employees to actively use virtual currency first by improving [their] virtual currency literacy.
What do you think of GMO offering to pay their employees in bitcoin? Let us know in the comments section below.




alfwesh22

Tuesday will see the launch of Super Bitcoin, a new hard fork which developers say will “make Bitcoin great again.”
One of a handful of forks due to diverge from the Bitcoin core chain this month, Super Bitcoin is a Chinese effort looking to optimize Bitcoin through measures such as Lightning Network and an 8-megabyte block .

The new chain’s network snapshot is set for block 498,888, to occur during Tuesday, Dec. 12.

Explaining the impetus behind their decision to create the new fork, developers said they were acting according to ideas from the “Bitcoin community.”

“Please remember: ‘This is just an experiment,’” the project’s website advises.

“We are merely implementing the proposals recommended by the Bitcoin community. Only when we put these talks into actions that we can make Bitcoin great again.”

Broadly following Bitcoin-esque attributes, Super Bitcoin is nonetheless notable for its supply 21,210,000, which includes 210,000 pre-mined coins.

“The 210,000 pre-mined tokens will be managed by the Super BTC Foundation and are mainly used to encourage early developers, invest in the super BTC ecosystem and ensure the operation of the Super BTC Foundation,” the website explains.

Major Bitcoin mining pools f2pool and BTCC are allegedly slated to support the fork, while 21 exchanges will notionally offer trading, according to listings.

December also sees the birth of new Bitcoin ‘versions’ with names including Bitcoin Uranium, Bitcoin Cash Plus and even Bitcoin God.




alfwesh22

Dave Chapman, managing director at Octagon Strategy, was interviewed by CNBC’s Squawk Box after the futures market had opened regarding Bitcoin. His comments included a six-figure price point by the end of 2018, and more interesting use cases forthcoming.
The digital asset trader made it clear that the recent run up in values only indicates the potential for more in the future, with mainstream adoption just beginning to come online. Crossing over $100,000 would be a massive psychological barrier, but Chapman believes it's possible. He said:
“In terms of looking forward, I would say that throughout the continuation into 2018, I wouldn’t be surprised to see a six-figure headline.”
Don’t miss the big picture
However, Chapman also indicated that the most interesting aspects of Bitcoin were not its price, but its many use cases as the market continues to mature. Because of the inclusivist nature of Bitcoin, the bigger picture about access to financial applications should predominate thinking. He said:
“The price to me is probably the most uninteresting component of Bitcoin. I’m more excited about the applications…about what this means to people who don’t have access to financial inclusion. And I think that if we focus on the price, we’re losing track of the big picture.”
Finally, Chapman concluded the interview with a chuckle, saying that he would ‘happily’ go on the record to bet that a Bitcoin ETF  was in the near future, as the Securities and Exchange Commission (SEC) has approved the futures markets.




alfwesh22

Real estate is how ordinary people have stored value and ultimately accumulated wealth. Indeed, post World War II societies all but demanded access to credit through politics, and governments responded with in-kind favors to keep power. Compounding of easy, loose money spurred decades of growth in housing construction, materials, land, and requisite financial products. This, in turn, triggered the Business Cycle, and the basis for entire economies was exposed as theft and fraud. Bitcoin might be the chance to starve parasitical redistributive governments, ushering in an entire new way to build equity. 

Real Estate as Mal investment
The dean of the Austrian School of EconomicsLudwig von Mises, wrote extensively of malinvestment. Though kept alive in fringe American paleoconservative circles, and as libertarianism’s cult favorite economist, the notion hadn’t gained much popular traction until the US Great Recession of 2008.

My guess is he’s poised to make another appearance in the coming years.

Malinvestment starts the Business Cycle, that boom and bust you’re probably all too familiar with, according to Austrian theory. Central banks are its main culprit. Their monopoly of the money supply has created what is called fiat currency: a paper or digital money backed only by the full faith and credit of a given government. It is without restraint other than inflationary pressure, which governments for over a century have battled using central banks.

Inflation acts as debasement, enabling more tickets or digits to circulate than might otherwise under a sound or tight money, and it is a chance for politicians to promise goodies such as housing guarantees. The trade-off is to keep dollars, pesos, and won flowing enough to produce a wealth effect but not so much that government units of exchange become useless.

Buy Bitcoin, Not Real Estate

Central banks can then artificially slow the rate of fiat through the price of money, interest rates. It’s a faucet, controlling the flow.

Malinvestment is the inevitable result. Even with the myriad of tools available in our present age, you’d think someone crazy if they told you they could predict economic production levels, adequate investment allocations, research and development, etc. Yet that is what a central bank essentially does.

By socializing housing’s risk through mortgage guarantees, while privatizing profit, central banks signaled to property speculators, land holders, construction companies and equipment providers, brokers and investment funds that this industry was a “winner.” It created a classic moral hazard. Producers then dedicated resources and time toward housing because customers on the retail side were armed with hundreds of thousands of dollars in risk-free incentives.

Buy Bitcoin, Not Real Estate

It was simply a matter of time before markers were called on outstanding loans of credit, and creative financial instruments, which would have never existed otherwise, were revealed as hustles to take advantage of political cynicism.

As is now well understood, the US economy, the world’s reserve currency, collapsed in short order. Like dominoes clacking, people abandoned newly constructed homes, construction workers filed for unemployment insurance, entire housing neighborhoods ghosted, bankruptcies flooded federal courts for relief, foreclosures swept the world, and the globe’s biggest banks were added to welfare rolls, the dole. In a private, free economy malinvestment is a cruel mistress, unforgiving. In our modern central banking economies, it literally pays to match government folly absurdity for absurdity. They’ll bail you out.

Malinvestment’s keen insight is not the bust, but the blowing up of the bubble or boom. Understand boom times are suspect in a central bank economy, and much of modern economics comes into focus.
It was around this time too Satoshi Nakamoto’s white paper was released in response. Getting out from under the petty machinations of politicians and the whims of their constituents might be finally achievable with the advent of bitcoin.

Buy Bitcoin, Not Real Estate
 

Real Estate versus Bitcoin

Real estate’s historic appreciation might be a chimera, an illusion, as a store of value. It might be the case real estate in a voluntary, organically free economy could be rather inexpensive and without much fuss with regard to equity.
It’s hard to know without running history’s tape backwards, having no recourse to coercive malinvestment and redistributive policies. We are where we are.

Paul Moore, in a column for Bigger Pockets, completely ignores theory and history as recent as nine years ago, and asserts “I’m particularly passionate about multi-family real estate.” In a post riddled with appeals to authority, anecdotes, and half-truths, he ‘bravely’ comes down on the side of real estate in my proposed debate.

Bitcoin is rank speculation, he argues, insisting it is sexy while investment, the adult way to wealth, should now and forever be boring. He also attributes a bitcoin price fall in November to Jamie Dimon. How Mr. Moore could know this to be the cause isn’t exactly explained, but that doesn’t stop him from rhetorically asking if some yahoo’s statements could ever move real estate markets in such a way. Um, 2008 called, Mr. Moore, and would love to chat.

Nevertheless he continues, “I wanted to know exactly how multi-family stacks up against the other asset classes,” he wrote. “The numbers say that multifamily and retail are: 3x better than the S&P 500, […] 9x better than NASDAQ, 4x better than private equity,” and so on. The rest of his assessment of bitcoin as an investment is hacky and stale, sprinkling words like scam and lottery to leave a decided impression before any real consideration. Oh, and he has charts.

Bitcoin has had close to a decade to burst, but instead has managed to remain resilient, and has advantages over real estate in terms of the future of wealth accumulation. Investors can buy it in fractions. Barriers to entry in the housing market are notorious, but all bitcoin takes is a smart-ish phone.

Indeed, future investors have been raised on real estate kool-aid: they’ve learned to spend rather than save, as fiat economies demand due to inflation, and now cannot afford the down-payment anyway. The average home price has been blown up to such an extent, even if they were savers they’d be out of luck. In fact, bitcoin’s relative ease of purchase and lack of central control apparently appeal to the next investment generation ahead of even government-boosted stocks.

And as a result, the future seems crypto: free from government machinations, borderless, permissionless. It might even end up bringing housing prices down, closer to reality.

Are you buying bitcoin or real estate? Tell us in the comments.




alfwesh22

Despite its volatility, Indians are using bitcoin as an alternative way to invest and pay for items following the country's demonetisation move in 2016

Interest in bitcoin is growing in India despite a series of warnings from the central bank that the digital currency is a risky and unregulated investment.

Although the cryptocurrency is reputed for its volatility, it has gained appeal along with other virtual currencies following India's demonetisation move in November last year.

Last week the virtual currency reached record levels of close to US$20,000 amid a buying frenzy, before dipping back to around $16,000.

“Bitcoin has seen a dream run in the last year,” said Vikram Pandya, the director of the fintech programme at SP Jain School of Management. “Like other countries, many people from India are attracted towards it with expectations of getting high returns in a quick time.”

Since the start of October, bitcoin has more than tripled in price and soared about 15 fold so far this. Its rapid rise has drawn in millions of new investors, which is boosting demand further. Its surge last week came as speculators feared missing out on what is expected to be a watershed for the cryptocurrency on Sunday, when one of the world's largest regulated exchanges begins futures trading of the digital currency.

“Unlike earlier times, rather than putting or investing their money in bank fixed deposits, saving policies, mutual funds and gold, they are becoming more aware about investing in bitcoin,” said Shivam Thakral, the cofounder and chief executive of BuyUcoin, a New Delhi-based platform for trading cryptocurrencies, including bictoin.

Bitcoin is now accepted by a growing number of retailers and other businesses in the country, such as restaurants, as cash liquidity has reduced following demonetisation, resulting in businesses moving towards alternative payment platforms.

Although the Indian government is trying to push Indians to move towards digital transactions to reduce the country’s heavy dependence on cash - which is hard to track and can facilitate black money flows - it has not yet thrown its weight behind virtual currencies such as bitcoin.

Arun Jaitley, India’s finance minister recently said the government did not recognise virtual currencies as ”legal tender”. He earlier highlighted there are no regulations governing these currencies.

The Reserve Bank of India (RBI), the country's central bank, on Tuesday issued its third warning to members of the public about the risks of investing in bitcoin and other virtual currencies.

"In the wake of significant spurt in the valuation of many virtual currencies and rapid growth in initial coin offerings, RBI reiterates the concerns," RBI said in a statement.

It highlighted that it had not given "any licence or authorisation to any entity or company to operate such schemes or deal with Bitcoin or any virtual currency".

RBI said that dealing with virtual currencies came with "potential economic, financial, operational, legal, customer protection and security related risks”.

Mr Pandya said: “In India there is no specific legal framework to govern the cryptoexchanges and hence currently they are self-regulated. No one is entirely sure how bitcoin will continue to spread to the larger financial world."

Mr Thakral said that RBI is worried over the lack of control they have over virtual currencies, as well as being “genuinely concerned about people who have less knowledge about investment in crypt-currencies which is an unregulated market”.

“With the widespread prevalence of cryptocurrencies like bitcoins and many others, central authorities like RBI are in a fix since they have no control on the generation and usage of such currencies directly,” he added. “Since this technology is not in the control of central authorities, there are many Ponzi schemes prevalent in the market in the name of bitcoin. It has hence made it hard for the government to track and or stop them.”

A number of companies in India now tap into the interest in bitcoin. One of these is Unocoin, headquartered in Bangalore, which describes itself as India’s first entrant into the industry, operating the largest bitcoin-Indian rupee trading platform in the country. The start-up launched in 2013 and enables its more than 150,000 customers to buy, sell, store, use and accept bitcoin. In September 2016, the company raised $1.5 million in investment from a consortium of investors, and it has outlined ambitions to expand globally.




alfwesh22

As British Prime Minister Benjamin Disraeli once averred, there are three kinds of lies: lies, damned lies, and statistics. Bitcoin is frequently on the receiving end of them all, whether it’s exaggerated statistics about energy consumption or damned lies conflating it with terrorism. We’ve rounded up 10 of the most pervasive mistruths and endeavored to set the record straight. The next time someone brings one up, send them here.

1. Bitcoin Funds Terrorism
We’ll start with the most asinine assertion, although all of the entries in this list are pretty dumb. You know what funds terrorism? Terrorists and terrorist sympathisers. If you want to blame a currency though, try the U.S. dollar which has been used to fund more wars, proxy wars, bombings, hijackings, and insurgencies than any other.

10 of the Biggest Lies Told About Bitcoin  

In 2016, Europol found no evidence that terrorists were using cryptocurrencies to fund their activities. That’s not to say it hasn’t happened and won’t happen. It’s telling however that the only people linking bitcoin with terrorism are governments seeking to crackdown on digital currencies. If a major terrorist attack funded by bitcoin were to occur, we’d never hear the end of it. So far there’s been a lot of noise but nothing to substantiate this claim.
Yaya Fanusie of the Center on Sanctions and Illicit Finance had this to say:
[There] are examples of terrorists using virtual currencies, but probably are not indicative of a major push. Right now, virtual currencies are harder to acquire and spend than, say, prepaid cards, or the most anonymous way to fund terrorism – cash. And most terrorists operate in a world where fiat, or government-backed, currency is needed for their expenditures, so a virtual currency where one has to figure out how to cash out without tipping off authorities only complicates a funding scheme.
2. Bitcoin is a Bubble
Where do we even start with this one? No, bitcoin is not a bubble. It’s not going to come crashing down to earth and it’s certainly not going to return to zero. We’ve long passed the point of no return for that to happen. That won’t stop the B-word being trotted out every time bitcoin gains or sheds another $2,000 however. There will be corrections along the way – no asset in history has ever ascended in a straight line – but bitcoin is not about to pop. It wasn’t a bubble at $3,000, it’s not a bubble at $11,000, and it still won’t be next week after a dozen more op-eds have posed this question.

3. Bitcoin is Volatile
For those who don’t relish risk, there are certainly less exciting assets to invest in. Nevertheless, the notion that bitcoin is volatile and needs to be “tamed” is misguided. Hugely respected crypto assets expert Chris Burniskebroke this down in a recent slidedeck, showing that bitcoin’s volatility is now lower than Twitter stock. There are still roller-coaster days, but for the most part the digital currency is blissfully calm.

10 of the Biggest Lies Told About Bitcoin
4. Bitcoin is Tulip Mania All Over Again
If you’re not familiar with the much-cited case of tulip mania which swept 17th century Holland, your search engine of choice will furnish you with the backstory. The craze culminated in the price of a particular bulb reaching 4,600 florins. From there, the only way was down.

It turns out that tulips lack any sort of intrinsic value and make a rubbish commodity, just like seashells and pretty stones. Bitcoins, on the other hand, are easy to divide, imperishable, transportable and scarcer than tulips.

5. Bitcoin is Used by Hate Groups
10 of the Biggest Lies Told About Bitcoin

We could launch into a lengthy explanation as to why it’s ridiculous to blame a currency for the actions of a tiny subset of its users, but sometimes the simplest responses are best:

10 of the Biggest Lies Told About Bitcoin
6. Bitcoin is Mostly Used for Illegal Purposes
That claim might have been true in 2013, but today thevast majority of bitcoin transactions are for legitimate purposes. Chris Burniske also provided further evidence of this in his slidedeck which was cited earlier. Still, that won’t stop benighted hacks from the mainstream media trotting out this old chestnut whenever they can, usually accompanied by some variation of this image:

10 of the Biggest Lies Told About Bitcoin
 

7. Bitcoin is a Ponzi Scheme

A Ponzi or pyramid scheme involves older investors being paid back through the capital from new investors, until eventually the racket becomes unsustainable and the whole thing collapses on itself. The workings of bitcoin are completely transparent and its adoption and growth cannot be controlled by anyone. The price of bitcoin is determined solely by what the market is willing to pay for it, not by a necessity to pay back previous investors. Bitcoin is certainly not a pyramid scheme.  Bitconnect, on the other hand…

8. Bitcoin Can Be Hacked
Bitcoin exchanges and cloud-based wallets can theoretically be hacked, just like anything else connected to the internet. The underlying code powering the bitcoin blockchain cannot be hacked however. Bitcoin has been stress-tested more thoroughly than possibly any other piece of code ever written. If you’re worried about having your coins stolen,take our advice and use a wallet which you own the keys to rather than trusting a third party.

9. Bitcoin is a Fad
You know what else was a fad? The internet and cell phones.

10. Bitcoin Uses Exorbitant Amounts of Energy
10 of the
            Biggest Lies Told About Bitcoin  

We’ve debunked this loads of times, most recentlyhere, andWired have also explored the matter at length. Yes, bitcoin mining uses a lot of energy – though not nearly as much as reported – and yet every watt is worth it.

Rather than delve into lengthy technical explanations, here are a couple of pertinent facts to mull over: bitcoin mining uses a third less energy than is expended on Christmas lights in the U.S. each year. One study estimates bitcoin to use between 0.8 and 4.4 KWh per year. Compare this with the 138KWh per year spent on mining and recycling gold or the 650KWh expended by the global banking system annually and bitcoin looks like a model in efficiency.

To invoke an apposite quote, a lie can travel halfway around the world before the truth can get its boots on. The next time fake news defames your favorite digital currency, drop in this link and set the record straight. Bitcoin is many things but it’s none of the above.

What other bitcoin lies should have made this list? Let us know in the comments section below.




alfwesh22

Yahoo co-founder Jerry Yang claimed that the virtual currencies like Bitcoin will play a key role in the future of society. He even compared the volatility and technology of Bitcoin to the “early days of the Internet.”

In an interview at the sidelines of the Fortune Global Forum held in China in late 2017, Yang said that Bitcoin and the other digital currencies like Ethereum, Litecoin and Dash are the future of the financial system, although they are not there yet.
“Bitcoin as a digital currency is not quite there yet. People are not using it to transact. People are using it as an investable asset. I personally am a believer in where digital currency can play a role in our society. Especially in, not only the front end of doing transactions but also in the back end of creating a much more efficient system and a much more verifiable system”.
Other positive comments on Bitcoin and the other virtual currencies
Despite some criticisms and doubts against Bitcoin and the other cryptocurrencies, there are technology luminaries like Yang who support and believe their potential.

Among the believers is technology firm Apple co-founder Steve Wozniak, who claimed that he considers Bitcoin as a digital currency that is “more genuine and real” than the US dollar and better than gold as a store of value.

In an email interview with Cointelegraph, entrepreneur and investor Jonha Richman shares that she believes in the potential of Bitcoin and cryptocurrencies in general. In fact, like Yang, she believes that more and more traditional money will flow into Bitcoin in the coming months as cryptocurrencies are slowly starting to hit the much awaited mainstream adoption.

With these positive pronouncements on virtual tokens, the number of individuals who are attracted to the cryptocurrency market continues to grow. In fact, Bitcoin recently toppled Visa’s market cap with its latest all-time high price.




alfwesh22

Property Investors from Wenzhou, Zhejing Province, which has a reputation as the home of China’s savviest businessmen, are dabbling in the cryptocurrency market for new investment opportunities. Instead of holding Bitcoin, their focus is on forked coins. 

“Bitcoin Will Evolve into a Capital Game”
In 2008, a Wenzhou merchant surnamed Chen set up a real-estate speculation squad with twenty of his friends. They bought houses on the same street, negotiated on the sale price, and went to the same agent to sell houses. If anybody sold at a lower price, Chen would kick him out of the squad. Now as housing prices decline month-over-month due to the central government’s tightened property policy, Chen has sold off his houses and used the profits to invest cryptocurrencies.

He started with Bitcoin, but only focuses on forked coins. “Bitcoin will evolve into a capital game for rich bankers and financiers,” Chen explained. “I don’t have enough capital to compete with them, but the bitcoin price will keep rising and simultaneously the price of forked coins will increase.” He learned the concept of a fork when he realized he had received some free Bitcoin Cash in his account this August.

Bitcoin users usually get free forked coins at a rate of 1:1 like BCH and BTG, but some forked coins are distributed at a rate of 1:10 like BCD, even 1:10000 like Bitcoin X. Chen believes that this is the most direct way for forked coins to attract users. Normally, when a new coin is created, it is hard for it to gain brand recognition. These forked coins, however, don’t have to work their way up like other coins did, because they have the same userbase as Bitcoin.

Are Forked Coins Sustainable?
“Forked coins were worthless at first, but as trading volumes soars, price rises and falls, they are attracting more attention,” said Chen. Over the past three months, he has first invested in Bitcoin Cash (BCH), then Bitcoin Gold (BTG) and now Bitcoin Diamond (BCD). He bought BCH when the price was 2000 rmb ($300) and sold out when it hit 19000 rmb ($2800). He is looking for the next BCH.
Chen believes that four factors matter most for a forked coin to sustain.
First, the team. Who is behind the project? Do they have the ability to develop? Second, the price. If the price is already too high, then there is no room to rise further. Third, the user base. Is it listed on multiple exchanges? A coin must go global to rein in political risks. Fourth, patience. Forked coins will gain more traction, but it takes time.
Chen is now inviting public figures and big whales to join his crypto squad. He sees his squad as a small venture capital fund. As long as a project initiator has resources and welcomes small investment, he would get involved.
His investment portfolio is 10% BTC, 40-50% forked coins and 10% ICO tokens. He explained that his investment philosophy is to invest in the unknowns. “The world is changing so fast, it’s easy to miss an opportunity before you realize it. Keep an eye on what you don’t understand and that’s where opportunities lie.”

Do you see great potential in forked coins? Let us know your thoughts in the comments below. 




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