Sunday, December 17, 2017

Bitcoin Has Failed: But WON

Photo - Google Photos: 1$ is worth 2000. Just like buying stock, so there is no equivalency of how much $$$ is worth. 35.000





Bitcoin is failing as a currency

Daniel Cooper


It's been a good year for bitcoin investors but a terrible one for those who hoped that the cryptocurrency would become the de facto tender for the internet. Satoshi Nakamoto, its creator, may be dismayed at what has become of the project, intended as peer-to-peer electronic cash that didn't require the supervision of banks. Instead, bitcoin has become an investment vehicle, embraced by many on Wall Street, an asset class like every other. For all the success of the blockchain and bitcoin's soaring value, it's clear that Nakamoto's original vision has failed.
Historically, people needed a way of storing their money in manners more sophisticated than stuffing their mattresses. The practice was to buy precious metals -- like gold -- and hope that it would retain, and appreciate in, its value over the years. But as economies grew and society matured, it was necessary to move toward fiat currencies, which weren't intrinsically valuable in and of themselves. Bitcoin was Nakamoto's deliberate attempt to undo this by building a digital equivalent to gold.
And boy, did it work. In the past 12 months, the value of bitcoin has risen from a low of $777.91 up to a high of $17,178. The currency has always been volatile, but for a while its ceiling was around the thousand-dollar mark. Prices began to surge in the second half of this year, and TechCrunch's John Biggs believes that this new surge was entirely due to the investment community. On Dec. 10th, CBOE Global Markets began offering investors the chance to bet on the future health of bitcoin in the same way they can for any other futures market.
This surge in interest from the investment world is helping to elbow out any hope that bitcoin will mature into a method of exchange. Currencies need to remain broadly stable in their valuation to ensure that commerce can take place. Sure, there will be some shift in the value of the coins in your pocket -- it's why foreign exchange trading is a thing -- but put simply, a dollar should buy you the same thing on Monday as it does the following Friday.
"[Bitcoin is] unsuitable as a currency, because people are far more likely to hold it in anticipation of it appreciating in price." -- Kain Warwick
That's why Jeffrey Dorfman, the hard-libertarian professor of economics at the University of Georgia, believes that bitcoin is an asset rather than a currency. Earlier this year, he wrote that its volatility strips bitcoin of the characteristics needed "of a plausible substitute currency," making it instead a "speculative asset, a get-rich quick scheme." He adds that stable values are required to encourage both commerce and investment, since people need to understand the value of what they're buying, and buying into.
Kain Warwick agrees, saying that for the foreseeable future, "bitcoin will continue to appreciate in price, as demand for it as a store of value increases." Warwick is the CEO of Havven, a company launching an Etherium-backed currency that would directly rival bitcoin. He believes that bitcoin's soaring price makes it "unsuitable as a currency, because people are far more likely to hold it in anticipation of it appreciating in price."

Nakamoto designed
bitcoin to be deflationary -- artificially limiting the supply of bitcoin to 21 million, forever. Of that figure, there are significantly fewer in circulation, because several have been destroyed -- such as the
7,500 bitcoins that were lost in a Welsh garbage dump. The thinking is that the scarcity will ensure that its value will increase over time. But there's a problem with using deflationary money to run an economy, best explained by Nobel Prize-winning economist
Paul Krugman
Krugman told the story of a babysitting cooperative that was set up in the late '70s by Washington civil servants. In order to make sure that each of the 150-ish couples pitched in, the group printed a limited number of coupons, each one equal to an hour of child minding. But the parents began hoarding coupons for the future rather than engaging in babysitting commerce with one another. The slowdown plunged this primitive economy into a recession, mirroring the Great Depression of the early 20th century.
The solution, of course, was to inject more liquidity into the market, printing more coupons to lower their value and discourage hoarding. But because bitcoin has no mechanism for this sort of relief, it's likely that the economic theory underpinning it will come back to haunt it. That's not to mention that the more people who sit on bitcoin in the hope of its value increasing, the more risk there is that its value will plummet.


Responsibilities:
Summer sessions at UCLA, Enrollement & Lodging
• Design course curriculum materials
• Plan and deliver these lessons clearly
• Develop students' creativity and problem solving skills through study, research and practical projects
• Ensure student transportation and discipline while in Los Angeles
• Assist with school promotional activities
Summer Camp at UCLA, Enrollment & Lodging. 6 weeks of Courses, and two weeks visiting the Sony Film Studios, Paramount Film Studios, the Planetarium, Marina del Rey, San Pedro the old Greek Port, Malibu, and Santa Monica in the Los Angeles Bay.


• Design Seminars and course curriculum materials
• Plan and deliver these lessons clearly
• Develop students' creativity and problem solving skills throughstudy, research and practical projects through applied research
• Ensure student transportation and discipline while in Los Angeles
• Assist with school promotional activities, certification


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