Bitcoin - The Greatest Scam In History!

[Afi4wins]

 

This is a contributed post by Bill Harris, former CEO of Intuit and founding CEO of PayPal and Personal Capital.

 

 

I’m tired of saying, “Be careful, it’s speculative.” Then, “Be careful, it’s gambling.” Then, “Be careful, it’s a bubble.” Okay, I’ll say it: Bitcoin is a scam.

 

In my opinion, it’s a colossal pump-and-dump scheme, the likes of which the world has never seen. In a pump-and-dump game, promoters “pump” up the price of a security creating a speculative frenzy, then “dump” some of their holdings at artificially high prices. And some cryptocurrencies are pure frauds. Ernst & Young estimates that 10 percent of the money raised for initial coin offerings has been stolen.

 

The losers are ill-informed buyers caught up in the spiral of greed. The result is a massive transfer of wealth from ordinary families to internet promoters. And “massive” is a massive understatement — 1,500 different cryptocurrencies now register over $300 billion of “value.”

 

It helps to understand that a bitcoin has no value at all.

 

Promoters claim cryptocurrency is valuable as (1) a means of payment, (2) a store of value and/or (3) a thing in itself. None of these claims are true.

 

1. Means of Payment. Bitcoins are accepted almost nowhere, and some cryptocurrencies nowhere at all. Even where accepted, a currency whose value can swing 10 percent or more in a single day is useless as a means of payment.

 

2. Store of Value. Extreme price volatility also makes bitcoin undesirable as a store of value. And the storehouses — the cryptocurrency trading exchanges — are far less reliable and trustworthy than ordinary banks and brokers.

 

3. Thing in Itself. A bitcoin has no intrinsic value. It only has value if people think other people will buy it for a higher price — the Greater Fool theory.

 

Cryptocurrency is best-suited for one use: Criminal activity. Because transactions can be anonymous — law enforcement cannot easily trace who buys and sells — its use is dominated by illegal endeavors. Most heavy users of bitcoin are criminals, such as Silk Road and WannaCry ransomware. Too many bitcoin exchanges have experienced spectacular heists, such as NiceHash and Coincheck, or outright fraud, such as Mt. Gox and Bitfunder. Way too many Initial Coin Offerings are scams — 418 of the 902 ICOs in 2017 have already failed.

 

Hackers are getting into the act. It’s estimated that 90 percent of all remote hacking is now focused on bitcoin theft by commandeering other people’s computers to mine coins.

 

Even ordinary buyers are flouting the law. Tax law requires that every sale of cryptocurrency be recorded as a capital gain or loss and, of course, most bitcoin sellers fail to do so. The IRS recently ordered one major exchange to produce records of every significant transaction.

 

And yet, a prominent Silicon Valley promoter of bitcoin proclaims that “Bitcoin is going to transform society ... Bitcoin’s been very resilient. It stayed alive during a very difficult time when there was the Silk Road mess, when Mt.Gox stole all that Bitcoin ...” He argues the criminal activity shows that bitcoin is strong. I’d say it shows that bitcoin is used for criminal activity.

 

Bitcoin transactions are sometimes promoted as instant and nearly free, but they’re often relatively slow and expensive. It takes about an hour for a bitcoin transaction to be confirmed, and the bitcoin system is limited to five transactions per second. MasterCard can process 38,000 per second. Transferring $100 from one person to another costs about $6 using a cryptocurrency exchange, and well less than $1 using an electronic check.

 

Bitcoin is absurdly wasteful of natural resources. Because it is so compute-intensive, it takes as much electricity to create a single bitcoin — a process called “mining” — as it does to power an average American household for two years. If bitcoin were used for a large portion of the world’s commerce (which won’t happen), it would consume a very large portion of the world’s electricity, diverting scarce power from useful purposes.

 

All of this would be a comic sideshow if innocent people weren’t at risk. But ordinary people are investing some of their life savings in cryptocurrency. One stock brokerage is encouraging its customers to purchase bitcoin for their retirement accounts!

 

 

Source: https://www.recode.net/2018/4/24/17275202/bitcoin-scam-cryptocurrency-mining-pump-dump-fraud-ico-value

 

[Afi4wins]

I've always been against Bitcoin right from the very start, simply because of its 'dark' beginnings. More and more prominent people have tried to warn the public of this menace, but greed has always been stronger - millions of users want to get rich quickly, even upon realising that they can go bankrupt overnight instead!

 

A few casinos have already stopped accepting Bitcoin for deposits and withdrawals, but for the other casinos that are still maintaining it, well, all I can say is that these casinos are most probably either financed or owned by the blardy rich members of the dark organisation/society - the initiators and/or creators of Bitcoin!

 

I would say that demand for Bitcoin would soon diminish...so rapidly that existing owners and users of Bitcoin would be caught in total surprise! 

[ValDes]

With all due respect to the author, I find the content of his article as totally addicted to the well-known side of "crypto-haters" as I call them. Which automatically makes it an unreliable source of information unfortunately, at least for me...  

 

What's surprising me most though is the extremely short memory the modern humanity have. So many people "crying out" loud against cryptos claiming all possible sins, but somehow forgetting all their accusations could be easily thrown (with huge success though!) against banking system and fiat money as well. Ransoms are being paid with hard cold cash for millenniums! Early (and modern one too!) banking system is full of examples of thousands and thousands of scam schemes, ponzi schemes etc etc...

 

I'm not crypto supporter nor owe any crypto-currencies as of this moment. I'm just a person who believe no one and nothing could ever stop progress. And the technology behind most well-known crypto-based projects means not just some progress, it's actually revolutionary.  

[Afi4wins]

Agree mate...I am also a person who believes in technological advances that are good...as in blockchain technology. But humans being humans, scams and scandals will always be present, either with fiat currencies or cryptos...the big difference being it is damn hard to trace any criminal activities with cryptos, hence it becomes a very favourable medium.

 

So long as supporters and users of cryptos understand and know the risks involved, then they are free to do as they like. In the meantime, this blockchain technology should definitely be developed further to enhance the current fiat financial protocols and system. 

[cocopop3011]

I wish I'd seen that Valdes had already read and replied before I checked every one of those links

[Afi4wins]

I wish I'd seen that Valdes had already read and replied before I checked every one of those links

 

Oh geees! I forgot that the links from the article would also become active in my post! Luckily, they are links to non-casino related items, or else our Guru might come after me with an elephant gun...a huge one! Hahaha. 

[pinnit2015]

Technology advances? I’ve just been visiting places who still have Windows XP within their equipment etc.

 

No amount of patching is going to help when the Russian hackers come a knocking :-0

 

Sorry, ‘state sponsored’

[ValDes]

Technology advances? I’ve just been visiting places who still have Windows XP within their equipment etc.

 

No amount of patching is going to help when the Russian hackers come a knocking :-0

 

Sorry, ‘state sponsored’

 

Yeah, blockchain technology is one more of the VVP's most terrifying weapons... According to some 'state agencies' of course...  

[cryptocurrency]

I truly believe that bitcoin is the biggest scam in history

 

You may read my free open-access book (published January 2019) on this topic at

 

ww w . journalistethics dot com

 

Regards

 

Jay

 

Dr Jay Jericho

[cududors]

Yeah, there are some key points:
 

• One of the few economists who predicted the 2008 financial crisis warns U.S. senators of the pernicious side of cryptocurrencies.
• He also criticized bitcoin’s underlying technology, blockchain, calling it the most “over-hyped — and least useful — technology in human history.”
• “Crypto is the mother or father of all scams and bubbles,” Roubini told the U.S. Senate Committee on Banking, Housing and Community Affairs at a hearing Thursday.

[pinnit2015]

We see some big companies getting into it - IBM, Fedex, Walmart (in conjunction with IBM i think) but tbh I'm not sure how commonplace it will be in 10 years.

I did like Roubini's comments about 'paid propagandists' re Bitcoin as there seems to be an awful lot of BC spammers going about 

Personally, Bitcoin does nothing for me. Not yet, maybe it will, maybe it won't - jury's out.