Economic losses caused by bitcoin

1. Not only is there a bubble in the bitcoin economy itself, but even in bitcoin articles. A few weeks ago, I wrote some essays about my understanding of bitcoin; But my feeling is that I can't say exactly what bitcoin will look like in the future. And for all of us, what the future of bitcoin will be is probably one of the reasons why people are interested in this phenomenon. Therefore, instead of trying to judge in an unfamiliar field, I made contact with a number of economists involved in this field, who made a brief exposition of the future of the currency. It should be pointed out that I only seek the opinions of these economists through informal channels, so their statements on the future of the bitcoin are probably not so serious. Interestingly, many professors have not even heard of bitcoin, so they have not discussed it. I will probably consult them again later this year. Fortunately, I finally found some economists who are willing and able to participate in this topic. Here are their views on the future of bitcoin. Chris Robert, Professor of public policy and economic development at Harvard University: if a lot of smart people choose to believe more in a monetary system built and managed largely by anonymous computer hackers than in a monetary system built and managed by a real government, Then it can only be said that there are some problems. Fortunately, the situation we are facing is not so bad. For now, bitcoin is still largely a matter of media speculation, which comes from the ongoing financial turmoil and growing distrust in the global financial system. But this kind of media speculation is likely to prolong the ration of financial speculation. In this period, more and more financial experts will seek a new bubble and profit from it. Compared with corporate securities, futures and even derivatives, bitcoin's basic sense of value is more limited. Disintegrate and torn by dissension, the new loopholes will not lead to collapse of all the things. All of us do not care about the lack of anonymity. People who lose their private keys and may damage a small part of their wealth will not complain too much, and the improvement of the "mining" Trojan will not cause a sudden impact on the supply of bitcoin. Profit from any type of bubble may be a risky business, but there is no shortage of people who are willing to go all out in the global economy. Therefore, as an exciting new tool for financial speculation, bitcoin may continue to exist in the future. Robert McMillan, former FTC and Stanford economist, HNC advisors, head of portfolio management and director of quantitative research at investment companies: bitcoin is doomed. It's an unchangeable fate. Bitcoin has great value, such as easy to store, difficult to steal, and difficult to forge trading media. In particular, it will not cause species extinction (such as white oyster teeth or ivory), and will not cause direct damage to the environment; Unfortunately, anyone familiar with Paul Krugman's statement of "liquidity trap" knows that bitcoin's known and limited supply means that it is doomed not to be an effective alternative currency. In addition, bitcoin has no obvious use value (which is different from platinum), so it will be completely destroyed. However, the defect of bitcoin is proced in the process of its implementation, not in the idea itself. In my opinion, bitcoin will soon face competition from the new entrants of "currency 3.0" in this field. These new entrants will repair the defects of bitcoin, so they are more likely to realize the gold standard of currency acceptance, that is, to introce another important currency into the liquidity market of foreign exchange forward trading. In any case, we should pay attention to these new currencies. Their "mining" costs may be high, and their supply is unlimited, even with use value (such as passwords). In other words, the currency that really changes the market may be coming soon Matthew bishop, senior editor of the economist in the United States: as I recently published my e-book "in gold we trust?" on the future of money As pointed out in, the revival of gold and the emergence of bitcoin are just two sides of the same coin; In the era of "quantitative easing", the market has lost the sense of trust in the health of "legal tender" supported by the government, and both of them are the market's response to the lack of trust. I think that bitcoin and other digital money algorithms developed in Silicon Valley to control supply will help create a good way to store value. For these digital currencies, the biggest risk is that the government may take action to destroy alternative currencies other than legal tender. But what happens if a sovereign also issues an algorithm based currency? Will it push legal tender out of the market? Brett Gordon, a professor at Columbia University's business school: there are two main areas of discussion about the future of bitcoin. The first area of discussion is based on the short-term future. The focus is on when the bitcoin is a bubble. When will the bubble burst? As everyone knows, it is difficult to predict when a speculative bubble will end. If someone can be lucky enough to accurately predict the time of burst, then we can make a lot of money with this prediction. However, for us ordinary people, it is unrealistic to do this. Bitcoin's price chart reminds me of the Nasdaq market between 1995 and early 2000. Obviously, there are obvious differences between them; But in my view, what happened in the Nasdaq market ring this period can represent many of the price bubbles that have not yet been broken. From the trend chart of Google Trends, bitcoin also presents a similar form, indicating that when the media craze about digital currency graally fades, investors' interest in this kind of currency may also fade. The second category focuses on the long-term future of bitcoin. The focus is: what will the bitcoin market look like in the next five to ten years? Compared with predicting when the bubble will burst, it is more difficult to predict the long-term future of the bitcoin market. I think one of the important contributions of the bitcoin market is that it can serve as a "proof of concept" for decentralized secret money. Bitcoin has two advantages. One is that it is deflationary in nature; Second, transactions using bitcoin are anonymous. Given the recent series of financial crises and growing concerns about online privacy, these two benefits are good for bitcoin, as well as for any secret currency that will rise in the future. Peter Rodriguez, a professor at the University of Virginia's Darden School of business: at first glance, bitcoin is nothing special; In fact, almost everything can be used as "pseudo money.". Moreover, deep concerns about fiat money and measures to avoid the risk of relying on central banks are nothing new. In fact, in the post gold standard era, the popularity of legal (paper) money is surprising. However, when the market's confidence in fiat money graally weakens, people will turn to recognizable and reliable value storage methods, which is not unimaginable in the current world. After the fall of the Berlin Wall, Russia and other countries separated from the former Soviet Union used highly functional "Trinity" currency substitutes, that is, cigarettes for small items, vodka for medium items, and French brandy for high price items. To some extent, bitcoin is just a package of virtual cigarettes; But on the other hand, this virtual currency is revolutionary. Cigarettes have inherent value, and can be used for many purposes like cotton, even a little like gold; In contrast, the pricing of bitcoin is spontaneous, and its applicability as an alternative currency is not as good as paper currency or baseball card. Therefore, if bitcoin can establish its own value and let investors have confidence in it for a long enough time, the mechanism that can eventually turn this currency from a popular means of value storage into a real currency may begin to form and develop; Then bitcoin could become a reliable trading medium and index value, having its place in the world's monetary system. Even if bitcoin is only used to measure the value of goods ultimately traded in "real" currency, it will become a brand new thing, that is, real virtual currency regardless of country, rooted in the market's confidence in the whole set of rules established around this currency. Of course, bitcoin may "implode", which is not extremely impossible; However, any currency will always be tested, and all currencies have experienced a survival crisis.

2. With the existence of Internet and blockchain, bitcoin will exist. It has existed for a long time, and people graally recognize and widely apply it to payment. Then, it can play a positive balancing role in world finance.

3. Bitcoin is the so-called "cryptocurrency", which is a digital asset in the form of data. Your money in the bank may also be a bunch of numbers, but these numbers are equivalent to real money. Bitcoin is not. In the world of bitcoin, there is neither a central bank to manage nor an inherent legal framework. Because of this, the value of bitcoin is entirely determined by the market, which is currently very hot
bitcoin is stored in a digital wallet. You can store it on your local hard disk or mobile phone, or in a variety of online bitcoin exchanges. Keeping bitcoin locally is like hiding money under a mattress. If something goes wrong with your digital wallet, your money will be gone
to remit or collect money, you need to point your bitcoin client or network exchange to a bitcoin address, which is the address of every wallet. After a few minutes, bitcoin will generally leave your wallet and enter the other person's wallet. There are few sites that accept bitcoin, but there are a few. It's more difficult to use bitcoin in real life, but it can be achieved through some systems
what is the impact of bitcoin on the economy
despite all kinds of problems, the soaring price of bitcoin is partly e to more and more people using it. Bitcoin fans believe in its future. Ordinary people are also graally interested in cryptocurrency, but because it is too complex, it is difficult to popularize in the mass market. If it is really popular, the fluctuation of bitcoin's value will lead to greater turbulence in the global economy
if you bought $1000 bitcoin in 2010, it's worth about $35 million now. But if you buy $1000 bitcoin in early 2014, you'll only have a quarter of your purchasing power a year later. How would you feel if you paid with bitcoin and found that you could only buy half of what you had a few days ago
this kind of inflation is unstable, but if it is used in parallel with the government supported currency, bitcoin does have some advantages. Few people will exchange all their assets for bitcoin.

4.

I think this is more serious than the loss, but it should have little impact on our real currency. Because the two are not related . The currency of the virtual world is a game created by capitalists in order to converge the wealth of people in the real world. But no matter how we ordinary people speculate, we can't change the fate of these capitalists. They often dominate the changes in the war situation, turning their hands into clouds and covering their hands with rain. But no matter what they do, it should have little impact on the real world currency, otherwise governments will not allow them to exist

Therefore, changes in the bitcoin market will not affect the value of our real currency or other aspects. Even if there is, the governments of various countries will also vigorously suppress and try to rece the impact in this regard, so we should relax our mind

5. When the federal funds rate really rises, the general consensus is that the price of gold will face heavy downward pressure, because the planned cost of holding gold will rise. Europe and North America only account for 17% of the total global demand for gold. The market speculation about when the United States may choose to raise interest rates has been fierce: "however, they are both investment procts, The current real interest rate level in the United States is still very low. Bitcoin and gold are the same, and only 60% of them are related to investment
same
the association added: "other factors that affect the price of gold."
the world gold association said. There is an indirect positive relationship between these markets and interest rates, that is, the periodic rise of interest rates is usually accompanied by the increase of economic growth and consumer spending
the world gold association said. As of December 31, the real yields on three-month and one-year treasury bonds were - 0.73% and - 0.05%, respectively. Since 2008, the Federal Reserve has kept the federal funds rate close to zero
although the Fed was initially expected to raise interest rates for the first time in a decade in June this year, a series of mixed economic data, low inflation rate and dovish comments on the US economic growth rate issued by Fed chairman Yellen delayed the schele of raising interest rates, including some factors positively related to economic growth, It emphasizes that gold is an important diversified asset and a portfolio asset for risk management. "
in terms of investment demand, gold will continue to be a diversified asset
the World Gold Council said: "even when the nominal interest rate rises to 4%, gold has been quite effective in diversifying the investment portfolio and recing the risk of real interest rate, and it is not very sensitive to the change of interest rate in the United States. This helps to increase the demand for gold, as some investors will use gold to supplement bonds when managing equity risks and diversifying their portfolios. The impact of the US dollar interest rate increase on gold is the same as that of bitcoin, and the US Federal Reserve interest rate increase may not have the adverse effect on gold price as many people think
the relationship between gold prices and interest rates is more complex than it appears and more fragile than in the past, the World Gold Council said in a report on Thursday. In addition, demand for jewelry and technology is largely Pro cyclical, prompting investors to turn to profitable assets
according to the World Gold Council, the percentage is 0.6%
according to the association, the following is the impact of US dollar interest rate increase on gold. The view that US interest rate increase affects gold price is not as strong as before, because this situation is largely based on the market's analysis of gold price and interest rate performance from 1970s to 1980s. At that time, the economy was very different from what it is now< According to the World Gold Council, the gold market is also different:

the World Gold Council (WGC) claims that "the interest rate increase will not improve the prospects of fixed income assets. The demand for jewelry and technology accounts for nearly 60% of the annual demand for physical gold and is far below the threshold level. Over the past decade, demand for gold in developed markets has fallen from more than 60% in the 1970s to less than 30%. Emerging market demand for gold accounts for 70% a year, as stocks and bonds are likely to provide below average returns over the next few years. "
in the past 12 months. This role is becoming increasingly important. At the current yield level, the rising space of bonds may be limited, so it is not as effective as gold in easing equity risk

6.

first of all, I want to explain what this bitcoin is. Bitcoin is not a man-made coin, nor is it in circulation on the market. It is a virtual coin< with such a big drop in bitcoin, investors will surely suffer the biggest losses, and the futures and spot of investors will suffer double losses but in fact, it's really hard to say who can make a profit from it, because once bitcoin is sold, you will no longer own it. As for its later development, it has nothing to do with you, as long as you make a profit when you sell it

and according to the determination of relevant experts, there will be no winner after crossing positions and sharing losses. then it means that bitcoin suffered short sniping this time, which is a loss for those who have bitcoin, and no one can benefit from it< br />