• Larry U

Bitcoin Cryto or Klepto Currency

The investing world is full of news about how Bitcoin price keeps rising to new highs as more investors flock to claim their fortune. It reminds me of how thousands flocked to California in the 1800s, seeking their pot of gold. The only people that made a fortune were the storekeepers who sold to prospectors their picks, shovels, and mining equipment. Also, the saloon owners made a fortune by selling whiskey to the miners who did not find gold. They drown their sorrows to deaden their financial losses.

Here are a few things you need to know before you buy your Bitcoins:

  • No central Government monetary control. Bitcoins value solely based on bitcoin miners in your application. Most countries in the world do not presently recognize it as a valid currency.

  • Financial institutions like Bank of New York, MasterCard, and J.P. Morgan Bank discuss holding bitcoin, which defeats the purpose of keeping your identity private.

  • How do you justify the Bitcoin price? For example, suppose you buy company stock. In that case, its value is to generate profits to add value to the company stock. For instance, as the Los Angeles Times points out in today's paper. "Consider Musk's latest vaporous cloud — the announcement on February 8 that his Tesla electric car company had made a $1.5-billion investment in the cryptocurrency bitcoin starting in January. That's more than Tesla has spent on research and development in any of the last three years."

  • There are transaction fees for buying and selling Bitcoin.

  • There is no way to verify who you are dealing with on a transaction. Let me remind you bitcoin got its start on the "Dark Web." The primary reason bitcoin users did not want to be traced by law enforcement for an illegal transaction like drug sales, sex trafficking, and even assassinations.

  • This cult-like figure invented Bitcoin in 2008 by an unknown person or group of people using Satoshi Nakamoto. He supposedly disappeared in 2009 with at least $ 1.0 million in his pocket.

  • Recent accounts have indicated sales transactions take much longer than average credit charge transactions. What happens when you make a $20,000 purchase, but the day your transaction closes, and the bitcoin value drops to $15,000. Guess what? Your $20,000 purchase is now costing $25,000.

  • If the private key is lost, the network provider will not recognize any other ownership evidence. You can lose significant value as you try to locate your private key. Bitcoin value can fluctuate as much as 20% in an hour.

Do not buy bitcoin. The Bitcoin action reminds me of people that quit their jobs to day trade in internet stocks during the early 2000s. Also, do not forget what happened to the real estate bubble in 2007-2008.

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