Will Bitcoin Go Down In History As The World’s Largest Pump And Dump Investment?
Is Bitcoin a massive pump-and-dump plan the world has never seen before?
With Bitcoin falling below $20,000, significantly lower than its all-time high of over $60,000, many people are wondering if it’s a massive pump-and-dump scam the likes of which the world has never seen. Promoters “pump” up the price of an asset to create a speculative frenzy, then “dump” some of their holdings at artificially high prices in a pump-and-dump game. Some cryptocurrencies are outright scams. According to Ernst & Young, 10% of the money raised for initial coin offerings has been stolen.
The losers are uninformed consumers caught up in a greed spiral. As a result, there has been a significant movement of wealth from average families to internet marketers. And “massive” is an understatement – over $300 billion in “worth” is currently registered by 1,500 separate cryptocurrencies.
To some people, they argues that bitcoin has no monetary worth and can not be considered a currency because a currency has to meet 3 requirements: medium of exchange, store of value and intrinsic value. And they think that Bitcoin has none of them.
- Means of Payment. Bitcoin is nearly never accepted, while some cryptocurrencies are never accepted at all. Even where it is accepted, a currency with a value that might fluctuate by 10% or more in a single day is meaningless as a means of payment.
- Store of Value. Bitcoin’s extreme price volatility also renders it unsuitable as a store of value. And the bitcoin trading exchanges are significantly less reputable and trustworthy than traditional banks and brokers.
- Intrinsic value. Many people believes that Bitcoin has no worth and that it only has value if people believe other people will pay more for it – the Greater Fool theory.
Indeed, bitcoin has no role in the vast majority of applications. Dollars, pounds, euros, yen, and renminbi are superior means of payment, value stores, and things in and of themselves.
Cryptocurrency is ideally, to some community, only suited to one application: criminal activities. Because transactions may be made anonymously — law enforcement cannot simply determine who buys and sells — its use is dominated by illegal activities.
The majority of bitcoin users are criminals, such as Silk Road and the WannaCry malware. Too many bitcoin exchanges have been the victims of spectacular heists, such as NiceHash and Coincheck, or outright fraud, such as Mt. Gox and Bitfunder. There are just too many ICO scams – 418 of the 902 ICOs in 2017 have already failed.
Hackers are getting involved. It is claimed that 90% of all remote hacking is now focused on bitcoin theft by stealing other people’s computers and using them to mine coins.
Ordinary buyers are also breaking the law. Tax law mandates that every cryptocurrency sale be recorded as a capital gain or loss, which most bitcoin sellers fail to do. The IRS has directed a major exchange to furnish records of all big transactions.
Nonetheless, a major Silicon Valley bitcoin supporter argues that “Bitcoin is going to transform society… Bitcoin has been vert resilient. It stayed alive during a very difficult time when there was the Silk Road mess, when Mt. Gox stole all of the Bitcoin…”
Bitcoin transactions are occasionally marketed as quick and practically free, although they are frequently delayed and costly. A bitcoin transaction takes around an hour to confirm, and the bitcoin system is limited to five transactions per second. MasterCard can process 38,000 transactions per second. Transferring $100 from one person to another through a cryptocurrency exchange costs roughly $6, and much less than $1 with an electronic check.
Bitcoin is an outrageous misuse of natural resources. Because it is so compute-intensive, creating a single bitcoin — a process known as “mine” — requires as much electricity as powering an ordinary American household for two years.
If bitcoin were to account for a significant portion of global commerce, it would use a significant portion of global electricity, diverting precious power away from more productive uses.
All of this would be amusing if innocent people weren’t at danger. Ordinary individuals, on the other hand, are putting some of their life savings in cryptocurrencies. One stock brokerage encourages its clients to buy bitcoin for their retirement funds.
It is the SEC’s and other regulators’ responsibility to protect regular investors from deceptive and fraudulent practices. It’s time we gave them the legislative authority to do their job.
DISCLAIMER: The Information on this website is provided as general market commentary and does not constitute investment advice. We encourage you to do your own research before investing.
Join CoinCu Telegram to keep track of news: https://t.me/coincunews
Follow CoinCu Youtube Channel | Follow CoinCu Facebook page
Patrick
CoinCu News
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Will Bitcoin Go Down In History As The World’s Largest Pump And Dump Investment?
Is Bitcoin a massive pump-and-dump plan the world has never seen before?
With Bitcoin falling below $20,000, significantly lower than its all-time high of over $60,000, many people are wondering if it’s a massive pump-and-dump scam the likes of which the world has never seen. Promoters “pump” up the price of an asset to create a speculative frenzy, then “dump” some of their holdings at artificially high prices in a pump-and-dump game. Some cryptocurrencies are outright scams. According to Ernst & Young, 10% of the money raised for initial coin offerings has been stolen.
The losers are uninformed consumers caught up in a greed spiral. As a result, there has been a significant movement of wealth from average families to internet marketers. And “massive” is an understatement – over $300 billion in “worth” is currently registered by 1,500 separate cryptocurrencies.
To some people, they argues that bitcoin has no monetary worth and can not be considered a currency because a currency has to meet 3 requirements: medium of exchange, store of value and intrinsic value. And they think that Bitcoin has none of them.
- Means of Payment. Bitcoin is nearly never accepted, while some cryptocurrencies are never accepted at all. Even where it is accepted, a currency with a value that might fluctuate by 10% or more in a single day is meaningless as a means of payment.
- Store of Value. Bitcoin’s extreme price volatility also renders it unsuitable as a store of value. And the bitcoin trading exchanges are significantly less reputable and trustworthy than traditional banks and brokers.
- Intrinsic value. Many people believes that Bitcoin has no worth and that it only has value if people believe other people will pay more for it – the Greater Fool theory.
Indeed, bitcoin has no role in the vast majority of applications. Dollars, pounds, euros, yen, and renminbi are superior means of payment, value stores, and things in and of themselves.
Cryptocurrency is ideally, to some community, only suited to one application: criminal activities. Because transactions may be made anonymously — law enforcement cannot simply determine who buys and sells — its use is dominated by illegal activities.
The majority of bitcoin users are criminals, such as Silk Road and the WannaCry malware. Too many bitcoin exchanges have been the victims of spectacular heists, such as NiceHash and Coincheck, or outright fraud, such as Mt. Gox and Bitfunder. There are just too many ICO scams – 418 of the 902 ICOs in 2017 have already failed.
Hackers are getting involved. It is claimed that 90% of all remote hacking is now focused on bitcoin theft by stealing other people’s computers and using them to mine coins.
Ordinary buyers are also breaking the law. Tax law mandates that every cryptocurrency sale be recorded as a capital gain or loss, which most bitcoin sellers fail to do. The IRS has directed a major exchange to furnish records of all big transactions.
Nonetheless, a major Silicon Valley bitcoin supporter argues that “Bitcoin is going to transform society… Bitcoin has been vert resilient. It stayed alive during a very difficult time when there was the Silk Road mess, when Mt. Gox stole all of the Bitcoin…”
Bitcoin transactions are occasionally marketed as quick and practically free, although they are frequently delayed and costly. A bitcoin transaction takes around an hour to confirm, and the bitcoin system is limited to five transactions per second. MasterCard can process 38,000 transactions per second. Transferring $100 from one person to another through a cryptocurrency exchange costs roughly $6, and much less than $1 with an electronic check.
Bitcoin is an outrageous misuse of natural resources. Because it is so compute-intensive, creating a single bitcoin — a process known as “mine” — requires as much electricity as powering an ordinary American household for two years.
If bitcoin were to account for a significant portion of global commerce, it would use a significant portion of global electricity, diverting precious power away from more productive uses.
All of this would be amusing if innocent people weren’t at danger. Ordinary individuals, on the other hand, are putting some of their life savings in cryptocurrencies. One stock brokerage encourages its clients to buy bitcoin for their retirement funds.
It is the SEC’s and other regulators’ responsibility to protect regular investors from deceptive and fraudulent practices. It’s time we gave them the legislative authority to do their job.
DISCLAIMER: The Information on this website is provided as general market commentary and does not constitute investment advice. We encourage you to do your own research before investing.
Join CoinCu Telegram to keep track of news: https://t.me/coincunews
Follow CoinCu Youtube Channel | Follow CoinCu Facebook page
Patrick
CoinCu News
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Best Cryptos with 1000X Potential: Qubetics Revolutionises Blockchain as Polkadot and Cosmos Shape the Future
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