RetireJapan

Can someone explain what's going on with bitcoin? Sure, stock markets are down--a couple percent one day, and a couple more a day or two later--but bitcoin seems to be down much more.

At the same time, the $/¥ rate has remained stable, it was 114.64 when I looked earlier. Yes, the rouble has 'crashed', going from something like 77:$1, to 88:$1 (ballparking it). And looking at a short time period, that seems comparable to what has happened to bitcoin.

Or, is Ukraine irrelevant, and this bitcoin move is really a continuation of its fall over the past several months?

Are there any arguments for bitcoin left? Things like safety, store of value, or whatever independence it may have from traditional currencies don't seem like good descriptors right now. (maybe it's showing too much independence?)

In the cryptospace people joke that if bitcoin was created today it would be laughed at as a useless, energy hog with no utility.

It is driven by speculation and scarcity (only so many coins can ever be mined).

Proof of work projects are hard to defend ethically, and I would argue instead for something like Ether that has more immediate utility, and is moving to proof of stake this year.

My take is that bitcoin and other cryptos are high risk assets because they are volatile and mostly speculative. So when risk-off occurs in the markets investors shift funds from crypto and other risk assets such as stocks, to safe-haven assets like gold, bonds and cash (especially JPY, CHF and USD). That explains why USD.JPY hasn't moved much, compared to GBP.JPY for instance. And cryptos are more volatile than stocks so that explains why the moves are more severe.

Warren Buffet has in the past characterised bitcoin as "rat poison squared".

https://www.reuters.com/business/financ ... 021-06-23/

Bit coin produces nothing, and relies on others wanting to buy, just because, they believe they can sell it on to someone else who will pay more for it.
Just because it's rare doesn't make it useful or even valuable.(imho) I can't use it, can't admire it, can't enjoy it.
Sure some will get rich, but many will loose out. It seems to be a story, Block chains, Ledgers, but a ledger of what...a chain of what?

I could see NFTs differently, and even useful, because I see it as an electronic receipt.( not valuable)

Might be good if Japan developed an NFT for an electronic Hanko.... just so as I can get rid of my two or three I already have, then I wouldn't have to carry it around.LOL

concerned wrote: ↑Sun Feb 27, 2022 5:39 am Warren Buffet has in the past characterised bitcoin as "rat poison squared".

https://www.reuters.com/business/financ ... 021-06-23/

While I don't own any crypto, I wanted to avoid that characterization.

I've read that it might/can be a store of value, besides that one or another coin might function as a currency. Above, the comment that it's risky and this is a risk-off period seems to have something to it.

And I'll have to explore proof of stake/proof of work to see what's going on there.

Although I hold a bit of Ether, (and I am staking via Kraken Japan), I am very skeptical.

Web 3.0 looks dystopian, (or utopian for libertarians and late-stage capitalists). Everything on the blockchain, means everything is decentralized and costs money to access.

I see that BTC is getting interesting now, and has broken correlation with other risk assets such as stocks. It could be that some people in Russia and Ukraine are trying to get their money out via BTC (even though cryptos are technically banned in Russia), which is pushing up the price. This will surely incur tighter regulations on cryptos in the future, because what's the point of imposing strict banking sanctions if they can be bypassed with crypto? But when that will happen... nobody knows.

So BTC and other cryptos might become bullish from now, at least in the short term

northSaver wrote: ↑Wed Mar 02, 2022 12:49 am... It could be that some people in Russia and Ukraine are trying to get their money out via BTC ...

Could be...? Yes, it sure seems like a safe-haven effect, or at least a reflection of how crypto can work.