I love to talk about bitcoin. The only people who believe in it are the millennials. I understand that; they've grown up with this notion of bitcoin. But I find bitcoin to be one of the most ludicrous ideas I’ve ever come across.
Don't get me wrong; the idea behind it―the blockchain technology behind it―is bloody brilliant. The block chain methodology will change the manner in which we trade stocks, bonds, currencies and gold for years into the future. It will change the manner in which trading takes place.
But does bitcoin have any rationality behind it whatsoever? The answer, in my opinion, is no. It’s comically overpriced, comically close to a bubble, and we've seen bitcoin's high. I don't think there's any question that a month and a half ago we saw the high made in bitcoin.
What's amusing to me is that the believers in bitcoin say there's a fixed and finite supply that cannot be increased. Sure, maybe bitcoin supply can't be increased, but there are now over 100 other cryptocurrencies, which effectively increases the supply of cryptocurrencies.
And quite honestly, if you really think that bitcoin, once its last bit has been mined, is not going to reopen for further increases in supply, you're naïve; of course it will.
So has bitcoin supplanted gold at the margin? No question. For the millennials, bitcoin makes sense to them. Gold seems senseless; they don't get it. But the bubble has burst in the bitcoin phenomenon.
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