Bitcoin’s rally is all the news. It’s got the gold bugs all aTwitter as they watch their preferred safe haven asset of choice get upstaged again and again by the upstart, Bitcoin.
Every day it seems like another establishment media organization goes out of its way to give Bitcoin haters like one-note Peter Schiff an audience. The latest is Fox Business.
I can’t tell anymore if they’re doing this to discredit Bitcoin, gold, Schiff or all three consecutively and concurrently….
… and from a great height (apologies to Tom Stoppard).
Here’s your latest howler from Schiff courtesy of a tweet from the irrepressible James Woods obviously looking for a good conversation:
What’s funny about that statement is that it can be applied to gold just as easily as it can be for bitcoin. Let’s try it and see what happens.
“There’s no real use for gold,” Schiff would never say. “All you can do with gold once you buy it is sell it, but you need somebody else to buy it from you. It’s a massive pump-and-dump.”— Said nobody credible…. ever.
The Golden Rule of Gresham’s Law
Today no one settles anything of note in gold. The places that allowed it recently, like Vietnam, demonetized gold and drove it underground by the State Bank of Vietnam in 2012.
When’s the last time Peter or anyone else did anything with gold other than exchange it for dollars?
The answer is never.
And don’t talk to me about any VISA debit card scheme he may have for his clients. Any gold payment system like that has a dollar-translation layer.
There’s no one on the other side of even that trade accepting digital grams of gold. It’s all nonsense in an economy like today’s. Sure there are a few systems like e-gold and the like out there with people doing their best John Galt impression, but talk to me about liquidity.
It’s lower than it is on a lot of these sketchy crypto-exchanges out there.
Moreover, anyone trading gold for dollars to buy candy bars or shoes with a VISA card is a patent moron. Because you then create a taxable event to have the privilege of paying capital gains tax on that transaction.
I guess it’s a good idea if you buy high and sell low.. you get a discount on your sugar high. Talk about a metaphor for the modern age.
Why would you do that when gold is supposed to be the ultimate store of value? Wouldn’t you buy that same candy bar with dollars and not incur the tax and the hassle? Pride?
That is what has driven gold underground, that and it’s lack of fungibility.
If you dig deep enough this is why the gold standard eventually failed. Lacked of divisibility is a real issue in an ever-expanding division of labor which the gold standard of the 19th and 20th centuries help develop.
It’s ironic but true. Gold created the conditions for its obsolescence as a medium of exchange.
Coupled with central bank malfeasance this is just good ol’ Gresham’s Law. Over-valued currency circulates (dollars) and under-valued currency is hoarded (gold). Nothing new, just the Law of Diminishing Marginal Utility getting a workout in real time by mostly rational actors in a somewhat free market economy.
And that same dynamic is in place with Bitcoin. It’s taxed in such a way that it precludes you doing anything with it because of the danger it actually represents to the ‘real economy’ backed by digital fiat debt-based dollars.
“What do you want?” – Information.
I honestly don’t know what’s up with people like Schiff and his disciples at this point. We all accept the fact that dollars today are 95% digital. We may not like it but we have to accept it, especially if you accept the very real argument about liquidity and fungibility.
They are just ledger entries in encrypted databases around the world.
The main difference between them and Bitcoin is that an algorithm decides how many are produced over a certain period of time (6.25BTC every ~10 minutes) versus dollars which, Peter rightly points out, is the plaything of the Federal Reserve, the U.S. Treasury Dept. and the offshore Eurodollar markets.
But digital money is here to stay. In fact, digital money is the future. The only question is whether you want a digital currency that you know the supply of which allows for the rational calculation of demand or one that can be counterfeited at a moment’s notice by some guy with his hand in the cookie jar?
But let’s dig deeper into this utterly facile and febrile statement of Schiff’s. Let’s go one step further. In fact we can adapt his statement to the dollar itself.
“There’s no real use for the dollar,” Schiff also never said, though he should have. “All you can do with the dollar once you buy it is sell it, but you need somebody else to buy it from you. It’s a massive pump-and-dump.”
Because when you use dollars you sell them to acquire the things you need. You exchange one thing for another. In this case goods.
All Peter did with his dumb quote is validate the very thing that he decries about Bitcoin, that it is, in fact a potential store of value and medium of exchange because you can, in fact, get things you need with it. That you have to get dollars before you get the things you want is immaterial.
In fact, is holding Bitcoin any different than buying a stock or a bond? A stock or corporate bond is a claim against the tangible assets and future revenue stream of a particular company, but is it a ‘pump and dump’ simply because in order to realize that value you first have to exchange it for dollars?
No, of course not. Well, except for Tesla, but that’s a different rant.
The reality is that bitcoin, just like a stock, a bond or gold is a store of value because it represents the past work of the people who validated the information encoded on the block chain.
And with every block so encoded value accretes to the block chain and the ‘coins’ by which it is represented. That traditional valuation models have no way to directly measure that value is irrelevant.
To deny that Bitcoin has any value is to deny the fact that information is a commodity. And that’s truly facile when, at its essence, that’s all an economy actually is, information. The goods that move can only do so efficiently with good information about their production and distribution.
Price is the value of the information being transacted.
Peter Schiff makes his living getting paid to dispense opinions on markets. His entire life is built on the idea that information concentrated in one man’s mind is worth something to someone else who is ignorant of that information.
That people like Peter Schiff deny this simple process by which something acquires and builds commodity value through time is also irrelevant.
It means that while Peter studied Austrian economics he just didn’t understand it.
And so did every other gold bug who continues to stack to the exclusion of HODLing.
The Critical Shift
It’s no secret that I’m a fan of Bitcoin. It’s also no secret that I’m a fan of gold. I love gold. I own it and advocate for it. I even advocate for it to have a place in any theoretical private cryptocurrency based monetary system.
But what I won’t do is short change the value of one of them at the expense of the other simply because my ego is too fragile to handle the idea that I may have been wrong.
Honestly, the biggest regret of my life (other than not having more children) is not seeing Bitcoin’s strategic value earlier or I would have so many of them I wouldn’t have to spend my days writing articles defending it from punters like Schiff who are just bitter because they’ve been wrong.
That said, the current rally is based on a fundamental shift in preference for those who rightly are scared of what a Harris administration will do to the dollar post-Great Reset.
In a nakedly tyrannical world like we live in today where states clamp down on the free flow of capital outside of its control, Bitcoin is simply better technology than gold is today.
And this is not to say there aren’t any good arguments against Bitcoin. There are, but Peter Schiff and the gold bugs never make them. I wish they would. It would actually make writing articles like this almost a challenge.
The current rally in bitcoin is telling us clearly that there is a new premier store of value asset because of the current state of the world. Maybe that’s really what Schiff is decrying, a world that has passed him by.
What’s becoming clear even to me is that gold will only be valued in relation to bitcoin going forward, not the other way around.
It’s sad but true. In my heart of hearts I wish it were different and not because of the structure of my portfolio or the name of my business.
It’s sad because it proves that we are moving into a different age where technology is depreciating the value of an asset which materially improved the lives of billions for millennia towards its commodity extraction limit.
And many gold advocates don’t want to admit that they have stood by while the fortune of two lifetimes has passed them by. That’s the bad news.
The good news is, given the chaos around the corner, there’s still plenty of upside left. Except for Peter Schiff, he’ll die on this hill unfortunately, just like his dad died in jail over denying the validity of the income tax.
At least his dad’s was a noble goal.
Denial is the surest path to getting your ass kicked by reality.
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Capital Gains Tax on gold … yes and no. In the UK, if you own one ounce Gold Britannicas they are capital gains tax exempt because they are legal tender. Specifically, they are £100 coins.
Bullion is taxable, but not Britannias. I don’t know what applies in other jurisdictions.
Ron,the same thing mostly applies here, but don’t expect that exemption to last. They will wall that off.
I have little doubt that real, decentralized cryptos will appreciate far faster than PM’s for one simple reason. The attempt to build a futures market for BC and use it to naked short the market with paper futures contracts has been an abysmal failure. But I have one gigantic problem with cryptos, and that is the advancement of quantum computing both in China and D-wave in the USA and Canada, which is well in advance of what is being released to the public for “national security reasons.” I am nearly certain that the current real state of quantum computing is more than capable of cracking wallet encryption. The time will come in the not to distant future when people around the entire planet will wake up on a Monday morning to discover their wallets have been emptied during the night. Like the ridiculous equities markets’ coming crash to “fair value,” that time is not yet and will be determined by those George Carlin referred to as our “Owners.”
A good argument against Bitcoin. A better one is asking the question who wrote SHA-256?
Truth be told that if computing advances that far then the cryptography algorithm will have to advance with it. Again, take the argument that bitcoin is better technology than gold and extend it into the future.
Eventually, someone will hack bitcoin or someone else will build a better encryption technology.
This is the way.
That’s why there is something called the Time Value of Money.
Or why did the NSA write SHA-256? What I consider the probable end to cryptos. Future President Dorkus issues an EO on a Saturday that all real decentralized cryptos are illegal on the basis of national security. The NSA immediately empties all the wallets with their D-Wave quantum computers. All very “legal.” The proceeds go to buying more T-Bills.
Correct. Eventually computing capability will render BTC obsolete and there will be a better new crypto. Ultimately, these are more like real estate or a patent than they are like currencies.
A skilled web developer is coding using two contrasting languages and then selling it to the open market. You are just buying (the currently) strongest form of code that can potentially be used for something in the future.
Yes. You are proving my point. New Technology obsoletes previous technology. Bitcoin is a metaphor for the process. And today it is the state of play. Tomorrow it will be something different.
The time value of money is incredibly important. Worrying about 10 or 20 years from now today is foolish. You aren’t marrying bitcoin anymore than you are marrying gold or the dollar. They are means to an end. Gold bugs act like gold is an end mot a means. And that’s why this article from a gold guy like me with my bona fides needed to be written
Please educate yourself before making outlandish claims. Quantum computing is not a threat to most Bitcoin owners even if there is some super-secret lab that can produce 1000-qbit machines. If you follow simple rules of thumb – avoiding address re-use, which everyone is encouraged to do anyway, you are never exposing your signature until you spend it – which means there is nothing for QC to break. The signature (ECDSA or Shnorr) is the part that can be broken to produce a private key (in theory).
As for SHA-256 FUD. Again, please educate yourself.
Bitcoin addresses are double hashes – RIPEMD-160 hash of SHA-256 hash of a 256-bit public key. Irreversible one-way functions -each of them. Stop spreading ignorance, please.
Schiff is one of many outspoken gold shills that doesn’t understand crypto because his livelihood depends on his not understanding crypto.
I think you are correct, but with him and other weak Austrians it’s far deeper than that. They have Stockholm Syndrome that the government and its allies are all-powerful.
So they retreat to their gold safe space because they can’t break free of their chains.
Why are China, Russia and other countries stock piling so much gold if it isn’t worth anything. Shilling for digital currency is a big black flag warning that you are controlled opposition. Goodbye.
I never said it wasn’t worth anything. I said it was no longer the premier store of value asset for those worried about government malfeasance. There’s a big difference between those two positions. Or did you not read the entire article?
Buy both and if you are underweight bitcoin buy it and if you are underweight gold relative to bitcoin buy gold. This isn’t rocket science
That seemed a little overly brutal, imho. Gold has its place. The main benefit of bitcoin is that you don’t have to cram bitcoins up your ass to to bring them to another country. It’s yours everywhere you go.
My primary fears are that the market could latch onto another alt coin and leave your bitcoins in the dust, or that government will find a way to suppress the value of bitcoin over many years or decades, or that some math genius or quantum computer finally blows the whole thing up, in that order. That last one–quantum computers– could shake the Earth, if we become sufficiently reliant on bitcoin.
Government suppression is a threat. They’re already showing signs of anxiety about bitcoin, and they’ve been talking about the central bank coins for awhile now, so if they implement those, they’ll surely begin to pound on crypto real hard. Yes, it’s true that people will want to avoid the CBDCs after the gov begins to inflate them, but this process of devaluation and crypto suppression could go on for a very long time before the CBDCs fail, and then government will just make a new one and try again.
Perhaps in the end the government inflatable currencies will be rejected by the market, but it could be a very, very long road. There is a lot of ruin in a nation.
Right now Charles Payne is talking to the awesome hot Kiana Danial, so at least someone at FBN appreciates BTC!
It can’t be denied that bitcoin has some advantages over gold. But in long run, I believe that gold will endure as a store of value better than bitcoin. Schiff is right in preferring gold over bitcoin, but (as Tom points out), Schiff’s quote could equally be applied to gold itself. Schiff’s conclusion is not incorrect–only his argument.
The reason gold will endure is that thousands of years of history recognize it as a store of value whose supply cannot be significantly increased in the short-term. Bitcoin may have “a limited supply” (designed into its algorithm), but already, other alt-coins like Ethereum have already taken hold, and new ones are now being flogged to the investing public almost every time one turns around. The supply of such “tokens” will never really be limited.
Among the legitimate objections “Paul” lists is the not-insignificant risk that the latest “alt-coin” may sweep the current favorite into the dust bin. And it is much easier for a fickle public to embrace the “cryptocoin of the day” and abandon yesterday’s coin than it is for them to throw over an asset that has a 5000 year history behind it.
With respect that is exactly the kind of argument that misses the point of my discussion and feels like a coping mechanism for having missed the boat to this point.
It doesn’t matter if another coin can or could take over at some point. That’s no different than the world’s reserve currency changing from the pound to the dollar, for example. At the time of the handoff gold was still the basis of both’s value.
As Armstrong points out this is a move from a Public wave to a Private one. Where public assets will be repudiated and private ones preferred. Gold has real issues in terms of trust… where to hold it how to ‘tokenize’ or ‘digitize’ your private stash which BTC and all other cryptos do not have.
So it becomes a logistical problem to create a cold, secure source of gold from which to issue a gold-back crypto which doesn’t have the single point of failure of someone absconding with all the gold!
So, that’s where I fundamentally disagree… in the long run Bitcoin (or some better version thereof) will win out over gold.
Gold’s time as a reserve asset is limited. All good things come to an end. Unless and until there is a Carrington-style event which fries the electrical grid (a real possibility over the next 30-50 years) cryptos are the superior form of value storage because of the trifecta of fungibility, potential for privacy and mobility.
That said, I still hold a significant portion of my wealth in gold and absolutely advocate for it. This isn’t an either/or argument. That’s the failure of many gold bugs. Keep thinking in false binaries and you’ll miss out on the greatest opportunity to accumulate and retain wealth during the upheaval caused by the final collapse of Communism.
If you truly want to fight the existant power structure, bitcoin offers a real opportunity to be the ones who rise from the ashes wealthy enough to define the new order.
I urge you sincerely to think these issues through. Own both, be more secure.
Tom–Many thanks for taking the time to respond in such detail.
I don’t think I missed the point of your article. I do agree that in a relatively orderly financial world, bitcoin has all of the advantages over gold that you cited (fungibility, privacy, mobility).
I’m pretty confident that some kind of cryptocurrency will win out over fiat in the long run (maybe not so long), but I’m still not convinced that it will actually replace gold as the foundation of the world’s store of value. (The reasons I feel that way would be worth an article in themselves.)
I certainly wouldn’t argue against the belief that one should own both. The only one reason I don’t is that I consider the gold portion of my assets to be wealth preservation insurance and not “investment” per se. I don’t feel like bitcoin is mature enough yet for the average person to consider it a safe harbor for that purpose. It still exhibits so much volatility compared to gold that it feels much more like speculation. If a person who doesn’t have any bitcoin enters the market right now and his timing isn’t perfect, who knows how long he’ll have to wait to recover.
You are welcome. And I see gold that way as well. I also see Bitcoin the exact same way. I don’t view either of them as ‘investments.’ I see them as savings, your personal pool of real savings.
Go through the archives here. I’ve written extensively on the subject of money, gold, bitcoin, stores of value and the rest of it and how that all ties deeply into the roots of Austrian Economics.
Today’s article was meant as my final attempt to end the bullshit schism between gold bugs blinded by their hatred of Bitcoin and the reality of the world changing underneath their feet.
You should own both. You should understand both assets’ limitations and advantages. If you don’t, I’ll be here to keep pounding the table on this subject.
I feel strongly that bad Austrian economists like Peter Schiff do gold and Austrian economics a disservice by promulgating lazy, insipid and emotional arguments to keep people trapped in gold without entertaining the possibility they may be *gasp* wrong.
I personally convinced multiple heavyweights at the Mises Institute of Bitcoin’s validity back in 2010/11.
And people like Safidean Ammous have built on those early discussions to create even more robust arguments for Bitcoin than I ever could have.
I understand the reticence, I just don’t have much patience for it anymore, especially when so much time was lost in these past seven years.
The gold bugs would be right about everything if Bitcoin didn’t exist. I’m a gold advocate, but I’m not a gold bug. It’s not religious or mystical for me anymore.
Bitcoin has no intrinsic value. It’s entire structure and network can be cloned infinite times.
Gold is an asset with no liability, it is a lump of metal. Credit money and instruments linked to gold (or silver) are redeemable in gold and debt it gold monetary systems is extinguished.
The dollar and other fiat currencies are at least “backed” by the “assets” of central banks. A portion of which is gold. The majority being “government bonds” which in theory are future income streams from taxation. Mortgage back securities make up most of the rest. The dollar is not redeemable anymore, and debt is never extinguished.
A bitcoin is a liability without an asset backing it all. It is even worse than the dollar. It is nothing more than a speculative hot potato. Bitcoin does not allow for investment, borrowing, lending and saving. It is not a monetary system.
Let me know, Mr. Luongo, how many loans are denominated in bitcoin which are financing productive investment in the economy. How many loans are denominated in bitcoin at all? Only a tiny group of bitcoin mining outfits have what could be considered a bitcoin income. No one rational would take out a bitcoin loan, when most of its proponents are screaming that it could go up 1,000 times, get in now! No one would want to borrow in rapidly appreciating bitcoin, with a non-bitcoin income.
Peter Schiff is right. Bitcoin is the ultimate pump and dump scheme. Even worse, it is pathological to human progress. It engages all economic forces onto the side of speculation at the expense of investment. It converts one man’s savings into another man’s income. If adopted worldwide, it would be equivalent to eating the seed corn on a global scale. The bitcoin fortunes of which you speak are someone else’s hard earned savings being consumed by speculators, which you cheer.
Bitcoin might be useful in the short-term to those locked behind draconian capital controls, or for criminals trying to launder money, or those selling drugs and underage porn. In many cases, intelligence agencies have tracked the account making these transactions, seized the coins and prosecuted the individuals. So much for privacy.
Educate and challenge yourself further by reading Dr. Keith Weiner’s analysis of bitcoins flaws and I guarantee you will regret having writing articles like this:
Gold and silver have been money for 5,000 years for good reasons. Under the classical gold standard (1797-1913), in which the “government money” was simply a weight of metal, we had the highest economic advancement and most stable interest rates in world history.
Despite your claims about a lack of liquidity, gold still has the lowest bid/ask spread out of any financial instrument today.
You do not need insurmountable quantities of gold to run a gold based monetary system. In the 1890’s at the peak of when Britain ran the world’s commerce and monetary system, there was about 150 tons of gold in London.
Nearly all of the gold ever mined in human history is still above ground in private hoards. Yes, Gresham’s Law and government legal tender laws have forced it into hoarding. Gold will not circulate as money at $5,000 / oz. any more than it did at $320 / oz. What brings gold out of private hoards and into circulation is interest.
Monetary Metals in Arizona has run a multi-year experiment with this concept. Paying investors a yield on their gold, in gold. And to a lesser extent at this time, silver. There is no dollar transaction layer. No 3rd party like BitPay, etc. Gold lending, gold interest, statements accounted for in gold ounces. Interest is the only thing that can reverse Gresham’s law.
I get that entering the content creation business is competitive and you always have to keep putting stuff out. But this article is beneath you and just not very well thought out. It’s crap. Less writing, more reading is recommended.
Ron Paul will be sad if he reads this. Irwin Schiff’s case was sound, he was unjustly imprisoned and died legally blind with cancer in a prison hospital. Peter is a good person, not deserving of slander.
I deem you the “Sneering Bitcoin Elite”.
Pizza Genie, I did this specifically to piss off a lot of people, apparently you are one of them. I regret nothing I said here but before you leave consider this.
I will destroy your entire missive with one sentence.
There is no such thing as ‘intrinsic value.’
If you don’t accept that then you have a lot to learn.
Arrogance is a useless quality
I es it is. Peter Schiff is then by definition useless
I admit to my mistakes with both gold and bitcoin. It doesn’t make me bitter it is humbling. Read the article again closely and you’ll see that. But you can’t because you are trapped in the false paradigm of gold as your one and only saviour
Good luck to you
Intrinsic value is simply defined the physical utility of an item. While I would agree that bitcoin has NO intrinsic value, even I, as a gold fan, have to say that even gold has very little. It is not considered an industrial metal, outside a few uses in things like electronics.
No. Instrinsic value does not mean that. It means that there is value that exists within the object regardless of time. That is a fundamental and methodological error.
There are plenty of objects produced whose value through time has fallen to zero.
For gold and bitcoin, their stock-to-flow ratios are what impute them with store of value characteristics which help to preserve value through time.
But when the day comes that gold’s use as an industrial metal exceeds its need as a monetary asset, it’s price will fall, like silver’s is doing right now, to its commodity extraction lower bound.
Bitcoin is putting that downward pressure on gold right now… that’s why I wrote today’s article.
I own BTC and consider myself as a classical libertarian, but whenever i see someone post stuff like this, i know they are either morons or pushing a dishonest narrative.
BTC has no utlity, its a fraudulent scheme, and very likely it is created by the government. But atleast i’m honest with myself and others when i say that i want to make money of other peoples greed. But to say that BTC is the new gold, then sir you are no better than the lying corrupt bankers. But i have seen this pattern with other so called “libertarians”. They switch side/opinion as soon as money is to be made. Fake people.
You do realize that i wrote the very first article about bitcoin for the libertarian community in june 2010 for lewrockwell?
I’m sorry to break it to you, and I am happy to be wrong, but gold is becoming a second class store if value asset. Bitcoin is setting the pace. Gold will play catchup from here on out
I take no pleasure in saying this. I would prefer gold to win out. But it won’t for the exact reasons I laid out today and for a host of others
Now, that said, it’s always smart to rotate out of overvalued assets in the short teem into undervalued ones so there will be times to sell BTC and buy gold and vice versa. But given the supply and demand fundamentals and the potential TAM bitcoin has a lot more room to run
I know I pissed in a lot of people’s corn flakes today but that was done on purpose because the gold crowd has to reconcile that BTC is not the enemy it is the very thing that will help gold achieve full value by breaking the control system on it
These points are true enough if you state the necessary preconditions, some of which are the survival of: the internet, long range communications, widespread computing resources, and other sophisticated technologies. If you believe these things will exist beyond the end of the oil age or that the age of oil will be with us for quite a while, then put your wealth into something like bitcoin. If not, know that gold and silver have been around as money for thousands of years and that central banks still have tons of it, and no bitcoin at all.
William. Buy gold AND bitcoin. But as of today, if the internet goes down, you better own lead and something that propels it at a high rate of speed. In a breakdown of civilization that complete, gold is nearly worthless until such TIME as civilization begins to reassert itself.
It’s a specious argument that monetary luddites have made about Bitcoin for 12 years now… and they’ve missed out on the greatest wealth transfer from the rich to the poor in the history of man.
Poor people are poor because they don’t understand the time value of money.
Both gold and Bitcoin are susceptible to the same dangers when it comes to the internet if you trade and store it remotely. As far as holding physical PMs go, you are setting yourself up to be robbed or murdered and a lot of worry in any event. Buy a nice piece of land in north Florida where you can grow food year round and be away from liberal mania. People in north Florida are armed, suspicious and there is nothing there that the government wants. Learn a good manufacturing skill and some people skills and discover the joys of gardening. Get a ham radio and license and learn code (“morse” code). Stock up on lots of food, alcohol, ammo and other real divisible, tradable items that have value and build yourself a comfortable, efficient home. If you have enough money, do the same for other family members. The more the better. Get a boat, a four wheeler and an RV and enjoy life while you can.
I’m one of those people in North Florida, armed and suspicious. Everything has risks. Prepare accordingly.
You have no idea how lucky you are. There is nowhere to run in the UK. Even what passes for ‘wilderness’ has government writ all over it.
It’s most unfortunate that my Yiddish forebears never got further than Birmingham. We need a scheme so charitable Yanks can sponsor libertarian Brits to escape the tyranny of their crowded little island.
On the subject of BTC, I agree that it is an imperfect albeit important weapon against CBDCs. My primary hesitation relates to the high likelihood of MEPs during the coming grand solar minimum. But of course this does not preclude the usefulness of BTC; it merely proves your point that we should have several basket options for our eggs.
By the way, I’m a fellow 100% carnivore. Have you thought about posting about the intention to destroy the meat industry and the health of millions with it? This issue really needs some traction.
It has nothing to do with the fact that BTC will rise higher than gold. There are many assets that have gone up more in price than gold (penny stocks, MSFT, palladium etc), thats not the point. The point is that you are using your platform to validate BTC instead of calling out the bullshit that BTC is. It has ZERO utility. Remove Tethers from the equation and BTC would be 99% lower. As long as Tether is allowed to print, btc will go up. Not because of adaption, not because of its awesome properties as a payment system and nor because of its “digital-gold” charahteristics. Only because of Tether and FOMO. Without Tether, NO FOMO.
All of the evidence points to that BTC was created by the government and that Tether is allowed to prime the market because the powers that be have an interest of BTC going up:
1) It legitimizes blockchain tech on which the CBDC system will be built upon;
2) It takes steam of off precious metals
And all of you fake libertarians are making a HUGE diservice to free markets, liberty and honest money by supporting this scam. The bankers are LAUGHING all the way to the bank. They only had to create a stupid database, put it on the internet, come up with a random bullshit story that some shy dude called “Satoshi” made this to take on the worlds central banks, and look: big chunk of the “libertarian” community swallowed the bait.
I’m more digusted with people that stab precious metals in the back as you did, then with those corrupt pieces of shit whore bankers.
My apologies for using foul language.
You are overly emotionally invested in hating bitcoin and it clouds your analysis. And you are the exact person I wrote this article for to ‘piss off.’
Peter Schiff has done so much damage to this community it is astounding and it’s a fucking tragedy because he’s simply yet another wall st. punter making money off of your fear and his ignorance.
I’m sorry. I’ve been in this business a long time. This ain’t my first rodeo. This may be your first interaction with me and coming in guns blazing and calling me a fake libertarian is not a good look.
Never assume you know more about something than the person you are arguing with….. it precludes you from actually learning anything.
I have been with BTC since the start. I have made more money than with gold. I know people who made tens of millions of $, who operate exchanges and who work as OTC dealers. All of them KNOW that BTC is pure GARBAGE. It has no functional utility. It does however have awesome attributes as a pump & dump vechicle and is easily rigged upwards with the help of Tethers.
I have no issue that people are speculating and making money off of BTC, as i have no issue people making money in other investments. In addition im not married to my gold, its just another form of currency – albeit the most trustworthy and most stable. But what i have serious f*king issue with is when people start comparing BTC to gold. Saying how it will dethrone gold and all the other bs reasons why its better. You can make the same bloody argument with ANY investment that goes up more in price. What about shares of Tesla, or Apple, why not fucking palladium? Just because they are outperforming does not make them a substitute for gold. And when i see Big Banks, Big Media, Big Government promiting BTC and creating legal frameworks that is more friendly to crypto than to precious metals, than i know what the god damn plan is.
And as i said previously, either you don’t have the mental capacity to see through the bullshit, or more likely, you basically don’t care either way and you are just pushing a narrative in order to increase the traffic to your website.
And I have been in bitcoin from the beginning… which is documented. And I know that the people who started it were not doing so because it was bullshit.
So, good luck random person on the internet that has been wrong for 12 years now.
I love gold, I haven’t sold an ounce. I will buy it when it is cheap relative to bitcoin and I will buy bitcoin when it is cheap relative to gold.
Accusing me of naked traffic whoring is pathetic and a dead giveaway as to what you really are.
Note to self: read Luongo for his political and economic acumen, not investment advice.
Gold has no Utility? Lost me there. If my wedding band were the only other utility for gold, it would still have one more utility than Bitcoin could ever have. But gold has hundreds of useful purposes. There could be no bitcoin transactions without all the gold transistors and switches across all the layers of technology that make up the internet. Gold is useful. Gold is money. Gold is currency. Gold is wealth. Gold will still be here after all us silly humans have gone. Bitcoin is just popular.
Gold has utility, but not much. Its industrial uses are real but small, and its jewelry form is just making it look pretty while it sits around waiting to be used as money.
It is precisely this lack of utility that makes gold such good money. Ideally, it shouldn’t have any utility at all except as money. Silver has serious industrial uses and this makes it a less perfect form of money.
Bitcoin has absolutely no utility at all, which is a great feature for it to have. Its value lies in what people think other people think it is worth.
You are describing Mises’ Regression Theorem. So many in these comments are proving my point that they think they understand Austrian economics.
But they don’t.
Commodity utility competes with monetary utility and therefore price
Gold is fungible though
Not fungible enough
Gold and silver are the only medium of exchange that rely on nobody as ma counterparty. Metal is the only medium that the BIS uses to settle accounts. Only a moron would “sell” metal for paper. Gold can be exchanged for goods in every country in the world and you don’t need electricity to find it. Can one carry bitcoin in his pocket?
So tell me Bert how do we produce new gold? Do we fart it into existence? You sound like these Tesla zealots that say you can fill your car up For Free!!!
Bullshit. Gold mining today is an immensely energy intensive process costing between $700 and $1200 an ounce to produce.
Only an idiot would deny Bitcoin’s position today. Only a religious idiot actually. Which is why I succeeded so thoroughly in pissing all of you off.
At the top of this cycle Bitcoin will trade between $250k and $300k while gold will top out between $7k and $10k
If you hate the central banks why wouldn’t you want to accumulate as much preservable wealth outside the system as you can?
Having no bearing on the conversation of bitcoin or gold, your comment comparing the older and younger Schiff’s deaths adds nothing to the conversation except meanness. It was ugly and uncalled for. The very type of expression becoming so common today. And common it is.
I don’t agree. It was a low blow but a fair one. I know a lot of libertarians see Irwin Schiff as a hero and I’m sympathetic to that. But the truth is that he died for a cause that perpetuates an illusion. I think he was noble but wrong.
But Peter’s cause celibre is to promote gold in the same misguided manner. This kind of zealotry is dangerous and he’s actually harming the very cause he thinks he’s championing
Bitxoin represents the greatest wealth transfer from rich and powerful to poor and powerless in the HISTORY OF HUMANITY and he’s telling you it’s a pump and dump?
Peter wants to be his dad in the worst way imaginable and that’s exactly how he’s going about it. In fact he’s now a useful idiot for the very people he thinks he’s fighting.
My anger about this is deep. He’s not the only one in this group but he is the most vocal
This is so emotional in here….
“They can take our Gold but they can never take our Bitcoin” or is it vice versa?
Love the discussion here and learning from all arguments made.
I suggest to look at the masters running the place. All central Banks are loading up on gold since 2009.
At the same time they pump fiat in quantities that enable them to buy every asset, scientist and journalist/blogger on Earth and set the desired price for all markets.
What use is it comparing assets that can be manipulated both, in terms of markets and awareness? Exactly.
Observe and think for yourself.
Internet is the backbone of Crypto. Who controles internet?
Abundancy of Electricity is essential for Crypto. Who controls electricity?
Prices of metals & inflation need to be controlled. Bitcoin is the pressure release. Hodl as you please and enjoy the rising prices as they last. When the masters want to shut it down they will. Perhaps Iran, NK or other non-compliant countries will EMP the masters before that. Goats may prove the best investment.
They may do that Mac but if they do they lose everything as well. Their power now rests on this control which they are losing. And the generational shifts will phase them out.
Iran is embracing bitcoin as a sanctions relief mechanism. Do you think the people will stand for it to be removed once it takes hold? If anything Iran is cryptos ally now just as I predicted it would be when Trump went sanctions happy. Go look at the back catalog log here.
Thanks for the thoughtful comment
It’s really fascinating. What is money? Just having intrinsic value is maybe not the prime quality. Carrots have intrinsic value, and even if they were somehow immune to decay, they are only desirable in limited quantities…unless you want a Woyzeck world. It’s the relative lack of intrinsic quality that makes gold so special. It’s universality rather than particularity. The extrinsic quality is that people will use it for trade, like stones with holes in. I’m leaning towards Tom here.
Everything has a time value associated with it. All things depreciate to zero or their commodity extraction value over time.
Some things, like gold, preserve stored value because they have no other use, do not degrade etc. Bitcoin shares all of those characteristics and others that are more highly prized in a mostly digital economy.
This article was meant to be a moment of tough love for the gold bugs and a wake up call to what is coming for all of us. Prepare accordingly.
Here’s a few questions; 1] Who is SAtoshi Nakamoto? Sounds like a NSA spook to me with all the mystery surrounding him, but I guess he’s a saint that wants to save us from TPTB! 2] Who says that bitcoin (or any other crypto currency) can not be manipulated by the PTB? Heck, they do it all the time in the stock, bond and gold & silver markets, markets that are way bigger, so why not here?
Read this Zerohedge article which makes clear that 4% own 95% of Bitcoin;
Yes, they wanted cryptos to go up, so that everybody and his grandmother would jump on the bandwagon. Now that everyone is aware of the crypto-currency phenomenon the reverse is happening so that they can „take responsilibilty“ and regulate „crypto“-currencies by issuing their own version, which is of course completely centralized. Just check out IMF’s Lagarde on the matter;
3] It is a fact that the Internet and the PC industry were founded by DARPA and the pentagon; imo they gave use the Internet and computers not for our freedom, but to surveil and control us. Even a gate keeping institution like Wikipedia admits this much;
4] Further support for my view that BTC is controlled by the MIC is that BTC is built around the SHA 256 cryptographic hash functions designed by ….the NSA. https://en.bitcoin.it/wiki/SHA-256
They even wrote a paper about back in 1996 (!), on how to develop something like a BTC, title „How to make a mint; the cryptography on anonymous electronic cash“. The NSA and anonymous, c’mon, stop kidding around…
5] I think you have to make the distinction between blockchain technology on the one hand and bitcoin and other cryptos as speculative assets on the other; yes, may be blockchain will change the world (I doubt it) but that doesn’t mean these cryptos are as good as gold. As far as supposed scarcity is concerned, I mean, how many cryptos are out there already, and how many will follow?
Furthermore, if there is actually still people outr there think that „cryptos“ are anonymous , think again;
Bitcoin and company sound like a great distraction from the real deal, because they can not have us owning something real, right? Everybody thinks gold and silver are dead in the water, and that’s the way they like it. My god, these people know us well….
of the smartest millenials I know, doesn’t fall for crypto-junk;
A little too much truthiness? Bitcoin is basically a NSA psy-op!
I am no expert in the field of crypto currencies but in addition to yourself, there are some very well informed people who profess to know a lot about their future in our soon to be new monetary system. I am attaching a well structured, lengthy article that claims BitCoin is destined for the dustpin of history. I am not suggesting I agree or disagree with all of its claims, but they are to say the least, compelling. Please re-don your academic hat and read the article and please respond. I am a fan of your work and respect your opinions, although I don’t always agree. I think that’s a healthy sign of intelligent engagement. It’s perfectly normal to agree to disagree. Your claim that cryptos will be the future and far surpass the value of PM’s is a very bold call and one that has huge ramifications to people who have gone to great lenghts to protect themselves. I am one of them. The attached article also makes a compelling case, but for the opposite reasons presented in your article.
It is my opinion that the article by Kirian Van Hest has merit and is worth the time and effort to review it.
My post are about property maintenance but I’m sure bitcoin will hit 60k very soon… maybe tomorrow
Dogecoin is next
while it’s true that gold will never be used a currency again, it is also overlooked as a reserve, the kind CBs still use. so when the comic book world debt finally has to be reconfigured, what will it be balanced against to restore a working currency system? it certainly won’t be BTC. why would CBs turn to a technology that could replace them. no, they will reluctantly re-balance world debt against the gold they have and the gold they obtain.
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