Is Bitcoin a store of wealth? I want to give you my thoughts on this and see if Bitcoin has proved to protect anyone's wealth in crisis?
People might say that Bitcoin was $20k and now it is about $8200 so it has not been able to preserve its value. I would say think again as one needs to take Bitcoin into historical content and if we only go back five years to 2013 let's see how Bitcoin performed vs. inflation and other investments:
In January 2013 Bitcoin price was around $13.96 right now it is about $8200. That is 58639.25% gain.
How did the Dow Perform being fulled by share buybacks and debt? In 2013 the index was at 14547.51 points on April 6th, 2013 today's index is at 24748.07 the index has gained 70.11% in the last five years.
Gold was in 2013 at $1,204.50 the current price is $1,351.10 the price increase is 12.17% increase.
Silver was in 2013 at $31.25 the current price is $17.15 that is a negative return of -45.12%
Oil was $105.85 in January 2013 today's Oil price lays around $64.94 this is about -38.64%.
It is the scale of 5 years and, and it is not a fair look when we talk about protecting wealth and preserving your money. For that, we need to take a historical look at how currency has fared against assets like commodities.
Looking at real inflation in the US over the last five years we are looking at 24% Inflation based on the way they calculated inflation in 1990.
Historically commodities have always won against paper currencies, and now they are about to win again against the sudo electronic currencies of today.
Okay back to the Bitcoin and wealth insurance. There is currently one place that gives us a case study on how Bitcoin fared vs. the governments out of control Bolivares Fuerte. I don't have numbers from 2013, but I do have numbers from November 2016. The numbers at the time were 2,730,320 Bolivares Fuerte for a Bitcoin by today the price is at 5,548,136,960 Bolivares Fuerte. The total percentage increase is 203,104.64% the reported inflation currently is 8,000%+
.png)
Bitcoin did great so far in Venezuela even though Bitcoin crashed down to $8200 and are recovering. So with the limited amount of supply of Bitcoin, it can protect itself from fiat currency failures as it is decentralized. Unfortunately, gold and silver has been heavily manipulated and has lost steam over the last ten years. With GLD contracts selling currently approx. 1000:1 contracts vs. physical metal. It makes the current price fraudulently low, but until people wake up to these paper scams, they will continue to be a substantial manipulation of the prices of the underlying assets.
.jpg)
Wake up to the next Wealth Cycle, where off the grid assets will win. Many commodities and of course the newly invented cryptocurrencies. We are in for the ride of a lifetime as the current market bubbles created and backed by Trillions of the cheap currency falls apart!
Peace, Love and Voluntaryism,
John
The problem I find with crypto is the double edged "fork". The cost of forking is too low, and the act of forking defeats one of the main benefit which is a capped supply. Yes you have a capped supply of bitcoin but there is 50 shades of bitcoin-alt to compete....
I think PM or other asset backed crypto is the way.
I don't really look at the forks as printing any money as the forks might be the one of value and the other one dies. But as of currently all forks are alive so you could say that if it weren't for the forks BTC would be a lot higher in value :)
Yes fork can be viewed as value add say after the fork the new crypto have better transaction speed or lower cost. However it also opens the door for ill-intended make a quick buck scheme. After the fork the early adopter (probably the dev team and associates) will have a mining or otherwise advantage over the rest of the people.
What do you think about the many proposed asset backed crypto? Would that not be somewhat centralized for the storage of the PM or other asset that "backs" the currency so that is not really decentralized and or trustless?
It's worth a punt.
Bitcoin has very favourable gold-like properties, thus I think it is transitioning way from usage as a currency to a store of value usage. I think another more efficient cryptocurrency will become the standard for crypto payments.