But hasn't it at least 3 times already?
Stocks pay dividends and entitle the owner to certain rights. Btc gives you some crypto that others trust.
Not very similar.
Btc is actually a detriment to the environment without any real utility. The evidence of work algorithms burn fossil fuels and add CO2 and other pollution into the atmosphere, and at the end of the day, all you have is a bunch of useless 1s and 0s that we attribute with value that are incapable of doing anything other than represent a finite portion of a really complex math problem that we attribute value to.
From my understanding their "actual value" is massively inflated through a similar monopoly as De Beers for diamonds (except it's China as opposed to a single company).
I agree that BTC is a massive determent to the environment and so on, but rare earth mining isn't a picnic either. While all of those materials do have practical uses, their perceived value is massively over-inflated.
June 2011. from 30 down to under $1, and Feb 2014 when MtGox finally imploded.
These last few have been sell offs and market manipulation which only lasted a few days.
The volatility has quite a few causes, among them:
- Other currencies are used for all sorts of things that don't involve trading them–i.e. when have you last thought about exchanging those USD in your pocket for Euro? That creates stability. Compare to bitcoin, where almost everyone owning any keeps an eye on the market and is principally willing to buy or sell when they think they see an opportunity.
- Markets for real currencies operate under government supervision and regulation, and the facts that influence their value, such as employment numbers or GDP growth, are public, and reliable. For bitcoin, some rumour from China can move the market because nobody knows which information to trust.
I think this issue will be solved when there are more places accepting BTC. Then you wouldn't need to keep an eye for when to buy/sell it. You would be able to spend it.
I read on /r/btc/ someone saying that "currently, BitCoin are like Magic The Gathering cards". And it really does!
The smaller a market is the less buffer it has against volatility.
At least, new kids on the block are warned there is still a risk. Everyone knows that
The problem is once the number of miners drops enough someone,likely with a strong stake in an Altcoin, can simply buy enough hashing power to just take over for a few weeks resulting in an abrupt end.
Currently, ethereum has inherited all of the problems that bitcoin has and and magnified them by a substantial amount. We'll either witness the development team pull off a miracle - or more likely, in my opinion, watch the house of cards come crashing down.
Now, they are hitting scaling issues. But it will be interesting to see if they are more responsive.
https://eprint.iacr.org/2013/881.pdf
https://github.com/ethereum/wiki/wiki/Design-Rationale
https://blog.ethereum.org/2015/09/14/on-slow-and-fast-block-...