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Bitcoin is a trading vehicle. Personally, I wouldn't touch it with a 10ft pole. If anyone actually thinks it will replace anything, currency wise, especially competing against the central banks, they are fools. It's going to be vaporware.
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To call bitcoin a trading vehicle is to call is to call the internet digital mail. Blockchain technology is here to stay and we're simply in its infancy. We're maybe just barely in the dial up internet phase of blockchain.
History is clear that the more the powerful try to crack down on the individuals, the more people will flock towards freedom. The harder the central banks fight against BTC the more people will move towards it. This is precisely why they haven't moved against with more force to this point. It's uncontrollable and if they go to far, it will spread like wildfire. They make war against the mining machines, but that's about it.
The current value in BTC is its ability to store value, it's the modern digital gold. I really don't understanding holding Gold. If you think everything will continue as normal, than it holds no value beyond and other rare earth metal as a commodity.
It has great value as a vehicle for exchange of value. Specifically for exchanging large stores of value. There exists no better way of exchanging more than $100k between individuals. We're talking about days or weeks compared to minutes, Paperwork vs no paperwork. And BTC is more secure. This is true of digitally or in person. I can easily and freely travel with millions of dollars worth of BTC, try to travel with more than $10k in cash. The state can seize that cash indefinitely just because you failed to explain how you made that money legally. BTC has failsafe mechanisms that prevent this even if they get their grubby paws on my wallet.
The future of the block chain technology is beyond what we can imagine today. The most immediate and impactful will be smart contracts. For example, I will no longer need the state to hold and sign off on my deed to my property. NFT technology is legitimate, how it was being used was not. An NFT doesn't give something value and that's what we saw going on during the covid craze. It simply provides a digital proof of ownership, aka digital deed on the blockchain.
It absolutely has problems or cons.
1: it's still in its infancy and as such is speculative. Time will correct this.
2: Corruption in the exchanges. The free money by the feds allowed corrupt individuals to manipulate the market through fraud. It allowed them to speculate with money that didn't actually have. I think the reason we see it beginning to rise again is that this recession has shined the light on these actors and removed them from the market. Fiat also has these problem, too. Soros made his billions because of these vulnerabilities.
3: It's slow, but that's not necessarily a bad thing.
4: Every transaction is 100% trackable. This is great and horrible. However, it's not horrible, if another asset can fill that void.
5: Relies on power and an open internet
I'm sure I'm missing others.
I think we'll agree that the idea that BTC will replace cash is nonsense. I do think that some form of state currencies will always exist to fulfill the need for a hard and liquid asset. At least until the central banks try and force us to a cashless society. That's the beginning of the end for the central banks as we know them. As long as we remain free to innovate, the potential is there for someone to create a cash version of crypto. There's already been some experimenting with that. When the state forces us to a cashless society a black market will emerge that will make the prohibition error look like child's play.
My investment is not predicated on BTC replacing the US Dollar. The fall of the US Dollar will be a collapse of the world as know it. I'd venture to say that no or very few investments will be safe.
investor.vanguard.com
