We live interesting times:

• Where block chain technology tries to overtake real fiat economy;
• Where banks diversify their portfolio including cryptocurrencies and tokens;
• Where average people like you and me are starting to invest their hard-earned cash into crypto to save their money from inflation and a much-expected dream to get rich or at least earn more from crypto than simple bank deposits have to offer on short or long term.

However, what about BITCOIN? Why do some people, including myself think that although Bitcoin has an enormous price and popularity, and most of the time is regarded as digital gold, it could be basically worthless?

Yes, worthless!

At this point you will think: “this guy is crazy…! Bitcoin has the biggest market cap, it is the father of block chain technology, it is the best of the best of the best…and on top of that …IT IS THE FIRST OF IT`S KIND!”

Advertisement

Yes, everybody wants to own Bitcoin, and most of the time, anybody can buy a fraction of it, it does not matter how much….you or me or anybody can buy it. Therefore, we do. Big companies, investment funds, banks, countries and so on, do it as well.

And here lies the core of the Bitcoin`s problem.

There are altogether 21 million Bitcoin, 95% of which is already in circulation. No problems there. Many people hold different amounts of bitcoins, on exchanges, in private wallets, you name it and no problem there either.

Then why do I think Bitcoin will be worthless?

Well let me detail it to you.

Advertisement

Bitcoin price is dependent of demand and supply, which is the basic economic tendency for the last few hundred years, which is fine, the problem will be you and me.

Surprised?

Don`t be.

Why?

Let`s see why!

Advertisement

Since big companies are staking Bitcoin like there will be no tomorrow, hence driving the price even higher than it is today, less and less coins will be available for You and me.

You`ll probably say at this point….”Ahhh….c`mon….there is plenty out there, people always sell and buy, there is no way this will happen…”

When institutions are buying into something, they want monopoly on that asset to control supply, hence control price actions and profit from it, that is a normal thing, and everybody who is sane and has a little financial education, would do the same.

Now imagine, coin by coin, fraction by fraction, all the 21 million bitcoins ends up in institutions, in different forms, coins, ETF`s, securities or other financial assets, which are sold to the general public, of course with the promise of a good yearly return.

You`d still say at this point….”…This is a worthless article, this guy is crazy…”

Advertisement

Well I`d say, you are probably right, but since I wouldn’t buy Bitcoin at 500k USD, or 1 mil USD, so does other few million or maybe billion people on this planet, and because of crypto volatility I wouldn`t buy ETF`s or other financial products that have crypto in their package….well you`ll get the idea.

Now imagine all the owners holding altogether 21 million Bitcoins, which no one wants…well, you do the math how fast will the price of bitcoin crash and what will be the consequence of that crash, if not even the institutions that hold crypto will want to buy it from each other for the market price.

Reigniting Bitcoin interest will have to be done (and I presume that was exactly Satoshi`s purpose for creating bitcoin, start from 0 reach max value, reset, then start again), but usually anyone sane who get burned from the stove will not touch it again, so times will be hard on bitcoin.

At this point, You`ll say….”…Hmm…well…ahhh…maybe…. can this happen anytime soon? Or can it happen at all?”

The crypto world is dependent of you and me. Period! Without us, there is no crypto market.

Advertisement

Well dynasties, civilizations had fallen in time because of one thing and one thing only…..greed….

At this point…hmm. Is it even possible?

It is possible, because holding something that you cannot benefit of, and I mean you only benefit from Bitcoin if you sell it for cash, is “pure madness”.

Therefore, even if the crypto hype has kicked in, and everybody suddenly has become an “investor”, without a proper financial education, being inert to the risks taken by wondering in the forest of the crypto world, nothing is impossible at this point. In addition, at one given time, everyone will sell their fraction of bitcoin, which guess what; institutions will have the money to buy, regardless of the current market price…

Briefly, Bitcoin has no real world use, it is where it is, because it is the first of its kind, people still have the FOMO feeling towards it, but when this feeling is met with reason because it’s astronomic price, you and me will not be interested anymore… and the roller-coaster starts.

Advertisement

Well enjoy the ride…

This is not a financial advice; it`s based on many hours wondering in the crypto news labyrinth and reading other predictions, opinions and cautious messages, and is the opinion of the author. Crypto market is very volatile; therefore take cautious actions if you want to invest in it. Before investing, make your own research or seek financial advice.

The post When Bitcoin will be worthless! appeared first on News, Events, Advertising Options.

Advertisement