Fiery opinion often dictates Bull and Bear opinions, but an Assistant Professor has offered a learned approach.
When Bitcoin is down, the Bearish come out and berate the bubble-linked digital currency. Then, when things turn around, the Bulls stampede out the gates and proffer their emotional reasoning of how this is the money revolution.
All in all, it can be quite hard to find a learned and practical opinion, but Daniele Bianchi, an assistant professor of Finance of Warwick Business School, has given his thoughts on the recent rally and why it has happened.
A lot of thought and introspection was given when Bitcoin crossed the $10,000 mark. Questions were asked as to how and why Bitcoin reached this mark, and how it did it so quickly. The digital currency even raced on past $11,000. Now it looks to be correcting itself.
How did we get here?
Despite the correction back below $10,000, it is important to understand how Bitcoin got to such a milestone in the first place. In of the key reasons is of course, like in any booming market, demand.
“Despite fears about the Bitcoin ‘bubble’ bursting, the price of the new digital coins is going through the roof. Indeed, the increasing demand pressure from investors and speculators makes the case for an even further increase in Bitcoin prices in the near future,” Bianchi explained, adding:
“As the supply of Bitcoins is kept fixed by the underlying protocol, price increases are essentially due to increasing demand.”
Digital gold, not digital cash
Bitcoin also officially declared itself digital gold when it effectively shrugged off SegWit2x. The decision by the community to not do something drastic which would haul it back to being an effective payment method – coupled with Bitcoin Cash’s rise – indicated that there could be a full go at making it an asset.
“Bitcoin is becoming more like an asset class rather than a method of payment. This is something that the public and regulators should realize to fully understand the price dynamics of Bitcoin,” Bianchi explained.
Demand boom in a tiny market
Even when the cryptocurrency market crossed $300 bln, people were reminded to compare that seemingly monumental figure against other assets. The boom and the adoption acceleration seemed terrifying for those who are nervous of a bubble, but it really was just the beginning.
“In a sign of accelerating demand pressure, the number of active Bitcoin wallets has grown almost five-fold over five years. Similarly, the number of exchanges has been increasing exponentially since early 2017, partly driven by the explosion of the Initial Coin Offering (ICOs) as a funding strategy to set new marketplaces, and partly driven by increasing margins and profitability due to increasing Bitcoin prices.”
“Demand pressure is essentially driven by two things. Firstly, the increasing awareness by both the public and investors that cryptocurrencies are here to stay, and secondly, the increasing professionalization of cryptocurrency trading.”
“A clear sign of this is the announcement by the Chicago Mercantile Exchange (CME) Group, the world’s leading derivatives marketplace, to launch futures contracts on Bitcoin by the end of 2017. CME already publishes both a Bitcoin reference rate and a real-time index,” Bianchi concluded.
Ronnie Moas, quite happily, keeps changing his mind on where Bitcoin will be in the new year.
November has been a busy week for famed stock picker Ronnie Moas who, on No…
Roger Ver says Bitcoin is ‘cripple coin’ despite its break through to $11,000 Wednesday.
Bitcoin.com owner and Bitcoin Cash proponent Roger Ver has called Bitcoin ‘cripple coin’ despite prices rising over $11,000.
In comments on the r/BTC subreddit celebrating 50,000 transactions on cryptocurrency gambling site SatoshiDice, Ver defied optimism about Bitcoin’s 1,500% annual growth.
“As cripple coin is passing $10,000 SatoshiDice is about to surpass 50,000 on chain transactions with Bitcoin Cash!” he announced.
Ver has become increasingly outspoken on Bitcoin’s flaws since Bitcoin Cash (BCH) came into being in August. Despite erratic price and mining behavior, the entrepreneur formerly known as ‘Bitcoin Jesus’ has publicly divested himself of large amounts of BTC holdings in favor of the alternative chain.
His latest Reddit post, however, was met with little support.
“Roger, you’re gonna be writing a lot more apologies if you keep acting this way,” one top response reads Wednesday.
Specific criticism came from users alleging hypocrisy on Ver’s part, having previously complained Bitcoin Cash was not being referred to by its correct name in the press and industry.
“Roger you can’t complain and lose your temper over people calling BCH by the wrong name and then call BTC ‘cripple coin,’ the most popular response states.
“You’re just asking for it if you continue like that. BTC’s limitations speak for themselves; there’s no need for childish rhetoric.”
The wider Bitcoin community similarly picked up on the lack of popularity as Bitcoin actually breaks through $11,000.
After his outburst about people calling BCash BCash, Roger calls #Bitcoin “cripple coin” and actually gets a lot of pushback from his community. https://t.co/eUlcQUIlnZ pic.twitter.com/I9d4N3w0NS
— WhalePanda (@WhalePanda) November 29, 2017
The only efforts to support Ver’s view came in the form of somewhat bizarre account u/Nonce_00000000, which used the argument that he was infallible solely due to his status as a millionaire.
Bitcoin is a bubble that will pop because of oversupply, says one analyst.
A recent analysis regarding supply and demand suggests that the end of the Bitcoin b…
Roger Ver share his opinions on BTC and BCH future with Cointelegraph, as well as his tips for ICO investors.
On Nov. 30, back in 2011, Roger Ver made a bet to the world, that Bitcoin is going to outperform gold, silver and the dollar by 100 times. This Nov. 30 is going to be the sixth anniversary of his bet, and Ver is set to make another bet to the world – this time about Bitcoin and Bitcoin Cash.
Previously known as Bitcoin Jesus and now a vociferous advocate for Bitcoin Cash, Ver has recently advised NAGA Group, a German public fintech company who’s about to launch an ICO, to accept Bitcoin Cash and other cryptocurrencies alongside Bitcoin and Ethereum.
A company shouldn’t limit itself to Bitcoin, which has a higher fee, Ver said. “As long as it’s good money they should accept it.” He said he also spent the past Friday with bankers demonstrating the different network fees of Bitcoin and Bitcoin Cash.
Leading up to his new bet, Ver had a Q & A with Cointelegraph. Wearing a blue shirt with a white Bitcoin insignia and “Too free to fail” printed on it, Ver joked that he’s going to get his Bitcoin Cash shirt soon.
Cointelegraph: Where do you think Bitcoin and Bitcoin Cash prices will be?
Roger Ver: I think there’s a pretty good chance that Bitcoin price goes over $10,000 by the end of the year. It can very, very much happen, maybe on Monday, Bitcoin Core is going to be $10,000. Both Bitcoin and Bitcoin Cash will reach new all-time highs.
CT: The cryptocurrency space has attracted large numbers of new, mainstream investors. Does the technical difference between Bitcoin and Bitcoin Cash make a difference to them?
RV: In the short term, it doesn’t make that much of a difference. In the long term, the coin that’s the most useful becomes the one that’s used the most. The one that’s used the most will have the largest market cap, the most liquidity, and the biggest user base. And Bitcoin Cash is much, much more useful with Bitcoin Core.
CT: Bitcoin Cash critics have said that its big block approach is unsustainable in the long term, what is your response to that?
RV: Increasing the block size is a long-term, sustainable solution. If you remember your first modem, it’s probably a 24-hundred bite [2,400-bit/s] modem. And then they increased them to 14.4 K[bit/s] modem, that’s the big one that was coming. And then 28.8 kilobit (per second) modem, and then 56K modem, and then you have DSL lines, that are twice the speed, and then it went up, faster and faster, network and the company I did before Bitcoin was selling 100-gigabyte optical transceivers. It was about three mln times faster than the modems I was first selling. In 20 years they got three mln times faster.
If a one megabyte block is easy to handle today, 20 years from now we are going to have three gigabyte blocks just as easy to handle.
I don’t think that scaling on chain is not a practical solution. It very clearly is.
CT: What about Lightning Network as a scaling solution for Bitcoin?
RV: Lightning network is still just a science project at this point. Nobody’s having it in commerce, nobody’s having lighting network wallets, so it’s complete vaporware at this point.
Maybe it will come together, maybe it will be fantastic someday, but they intentionally broke Bitcoin which was working incredibly well and grew into this worldwide phenomenon.
CT: You got to meet cryptocurrency communities around the world. What did you notice?
RV: When you go to a meetup, the majority of people are in favor of Bitcoin Cash, on chain scaling. It’s only on the Internet that there’s a lot of people who are not in favor of that. The vast majority of people who support Bitcoin Core don’t even use Bitcoin, whereas everybody who actually uses Bitcoin on a regular basis is in favor of Bitcoin Cash or in favor of on-chain scaling.
It won’t take too many more months until Bitcoin Cash completely surpass Bitcoin Core in price number of users or market cap. It’s not a question of if, it’s just a question of when. I think it’s going to happen next year.
CT: Jamie Dimon said he would fire any trader that trades Bitcoin. How would you respond to that?
RV: I’m sure Jamie Dimon is a smart guy. I think he probably realizes that Bitcoin is going to cut into his business. It’s not going to be Bitcoin specifically though, but all cryptocurrencies.
But the smart ones [bankers] are going to adopt, right?
CT: Interest on ICOs has been spiking. What are your tips for new investors interested in ICO?
- The ICOs I would be the most interested in are those that are like securities. That you own a piece of asset of some company or to that effect. And that’s the thing the SEC should mind their own business about. It’s none of their business what people would want to do with their own money on the Internet or to invest in risky things.
- I would also recommend reading How an Economy Grows and Why It Doesn’t, by Irwin Schiff. (Schiff is famous for protesting federal income tax. His son, Peter, wrote How an Economy Grows and Why It Crashes). He was not a proponent of Bitcoin, but the book’s a great primer on economics. If you have better understanding of economics, and how something becomes useful as money, you’ll have an idea of how to invest in cryptocurrencies.
- Do your own diligence and do your own research, do not just blindly believe people on the Internet. Look at their business model. Are they moving their resources to where they are worth less or to where they are worth more? Is there a use case for the token?
- I don’t really invest in ICOs very much. I’m so busy with being the CEO of bitcoin.com. I regret that I don’t have more time to pay attention to ICO’s because I think it’s probably a lot of interest and opportunity on it.
Responses have been edited for clarity.