Between FUD and powder keg: Quo vadis, Bitcoin?
While Bitcoin is searching for its bottom, the community is already striving for new heights. Meanwhile, old acquaintances are rehashing classic FUD, like the Bitcoin ban. Opinion Echo.
Actually, the bitcoin price should be much higher. If you take the sheer amount of over-bullish news from the last week as a template, it is almost surprising that the best cryptocurrency of all time is not already above 60,000 US dollars.
Last Wednesday, 24 March, for example, Fidelity had a BTC ETF proposition on the line. Fidelity is no small fish, but with 4.9 trillion US dollars the third largest asset manager of Bitcoin Code in the world. For some time now, the asset manager has been following the Bitcoin standard and has launched its own crypto division, Fidelity Digital Assets. Naturally, the Bitcoin community acknowledged the bull call from Pomp with a five-digit number of likes:
Fidelity has filed for a Bitcoin ETF
– Pomp 🌪 (@APompliano) March 24, 2021
In addition, there is growing evidence of state actors keeping their toes in the wild Bitcoin stream with small reserves, you can also call them YOLO positions. One example is the Singaporean sovereign wealth fund Temasek, which, according to hedge fund manager Raoul Pal, is already invested in BTC. This means that not only the largest companies in the world, but even state actors would now be participants in the Bitcoin Game.
Billionaire and investment legend Ray Dalio is less bullish. The hedge fund Bridgewater Associates fears a sharp tightening of the regulatory thumbscrew around Hodler hands, with an eye on the 1930s US gold ban. In the wake of the economic crisis, President Franklin D. Roosevelt restricted the ownership of gold and certificates to the equivalent of 100 US dollars in order to provide the country’s central bank with some buffer again. Something similar is conceivable with Bitcoin, says Dalio.
They don’t want other funds operating or competing because things could get out of control. So I think it’s very likely that [Bitcoin] will be banned in certain circumstances, just as gold has been banned.
But the historical analogy is not really comparable. After all, the US dollar was backed by the precious metal back then. Rather, a ban on private ownership was intended to bring gold reserves under the wing of the central bank so that it could further expand the money supply.
Johns Hopkins professor: Bitcoin is not worth a penny
Steve Hanke, an old acquaintance from the ranks of bitcoin FUDsters, is similarly bearish. The lecturer at Johns Hopkins University sees the long-term value of BTC at zero.
Bitcoin’s price growth is therefore only based on speculation. But the question is what the fundamental value of Bitcoin is – it is zero. In contrast, fiat money has a fundamental value because interest is paid on it. Bitcoin is not interest-bearing.
Prof. Steve Hanke
First of all, you have to clear this up
First, there is no such thing as intrinsic value at all. Value is a man-made assessment that can be quantified in price. The „value“ of an asset is different for every market participant; the sum of these individual considerations is reflected in the price.
The fluctuation in the direction of interest rates is also factually wrong. After all, one can earn interest with Bitcoin long ago. According to Hanke’s (inadequate) definition of money, Bitcoin would have long been money. Bitcoiners also appreciate the „fundamental“ properties – to use this terminology here. After all, Hodler does not use Bitcoin for daily payments, but to store their life savings in an inflation-proof digital gold. Civil rights groups like the Feminist Coalition in Nigeria can also be happy to have a censorship-resistant alternative to the state-controlled currency system in BTC.