Will Bitcoin crash 2018? (should I invest?)


#1

There is everything to suggest that Bitcoin is a mounting speculative bubble…still though, the value is rising at an astonishing rate…

Does anyone think its a good time to invest?


#2

No, but not because I think the “bubble” is going to burst this year, or next year…

A bubble is a mass delusion and a miscalculation by its nature. If many people many people are calling something a bubble - then it’s not exactly a mass delusion…

Is Bitcoin A Currency?
I think bitcoin is being denounced as a bubble, because critics argue that it has no value. This is somewhat true. It definitely has no vavlue as a currency. I have already done some work on this and the trading volumes of Bitcoin are actually quite high (shame I don’t have figures - sorry). But… the trading volumes of bitcoin beyond one percent are very low.

This tells is that bitcoin is not a currency…yet this does not mean it is simple an asset bubble…

Bitcoin Has Utility
Bitcoin offers utility in a number of ways. It is a completely global currency, that almost anyone with an internet connection can invest in. This means that it has value as a form of digital gold to protect regular investors from market conditions in their country.

A good example of this is in China. China has an incredibly large volume of Bitcoin users, however the rise began to accelerate in 2015 just as the Chinese government were de-valuing their currency. Chinese investors wanted to get out of the chinese market (sell all their Chinese currency) and Bitcoin offered them a chance to do that. Now the government is trying got stop these outflows, but it can’t.

My point is that Bitcoin can be used to escape market conditions of a country. If the local currency of a country is about to fall down, or collapse, many people are going to put their money into Bitcoin. That explains the surge in investors from Argentina, Venezuela and China as well.

Long-term I think Bitcoin is a speculative bubble. It could go up, or it could go down. No one knows, but in the short-term, I could see bitcoin surging in value on the back of an economic crisis as investors want to put their money in a safe places…

Personally, I would avoid it. Once bitcoin gets big enough to begin affecting national currencies, it will be banned, simply because it is an economic F-U to national governments…

I would put my money into something that you can value with certainty and that will increase in value on the long-term. This leaves the option of investing in the stock market, or farmland. Ideally, you should do both.


#3

Thanks for the response!

There’s already an article written about this on the website:

It says more or less the same thing…