Bitcoin Week
I'm going to devote today's podcast to bitcoin; I might as well just talk about bitcoin because that's all anybody else is talking about. On CNBC that's pretty much all they are talking about; they said it is "BitCoin Week". It sure sounds like it. I think they should just rename the network: Crypto News BitCoin Network. I would be a good guest on that network because I know either side.
Swallowing Hype Hook, Line and Sinker
But just like in the dot com bubble in the 1990's and the housing bubble in 2007, they are swallowing the hype hook line and sinker. they drank all the Kool Aid. When they look back at those manias, they like to laugh, but they did not laugh at them back then - not at all. The only people they laughed at were people like David Tice, he would come on and they would laugh at him just like they laughed at me when I talked about the bubble leading up to the Financial Crisis. Nobody at CNBC had any idea that there was a dot com bubble. All they did was laugh at people who pointed it out.
Even Less Legitimacy
Same thing is going on now, although they do refer to the bubble. But to me, this bubble is the most irrational of any of the bubbles I've seen. I there is a less legitimate case for BitCoin than any of the dot com stocks that went to zero, or buying sub-prime mortgages.
Total Market Cap: $460,355,182,968
But let me talk a little bit about the whole origin of this thing, in case you don't know. When Bitcoin first came about, it was the only crypto currency out there. Now there are over 1300 crypto currencies. The market cap is over $450 trillion. Bitcoin is trading today at over 17,000. That's a new record high on bitstamp.net. That did not take out the $19,000 record set on coinbase.com last week. We're up about 15-20% today. Futures trading debuted on Sunday night and Saturday, in advance of that, we had a pretty decent sell-off. Bitcoin sold off to about $13,000 and then it skyrocketed, it turned around on Sunday night and continued going up on Monday.
Speculative Asset
But in the beginning, the whole idea behind Bitcoin was that it was going to be money - a digital currency whose advantage was that it could be used anywhere in the world, anonymously, inexpensively and quickly. I loved that aspect of Bitcoin. But what I did not like is that it had no backing. It has no real value, so it never could actually be money. Now, as the value has skyrocketed, it is impractical to actually spend, and people are using it as a "store of value". But it has no intrinsic value. It is just a speculative asset. Privacy & Opt-Out: https://redcircle.com/privacy