Bitcoin isn’t a scam
Over the last two years, I've heard tons of people tell me Bitcoin is useless and "a scam." Everyone I hear that I just roll my eyes.
Although some people deem the Bitcoin community a cult, the founder of Bitcoin, Satoshi, never built the coin for the purpose of scamming anyone (although I'm in no position to speak on his behalf). Whoever Satoshi was, it's obvious by his posts online that his interest in Bitcoin was purely technological and utilitarian. Read his posts for yourself above and come to your own conclusions. He was a technologist like the rest of us, and not a greedy one.
Unlike other coin founders, Satoshi didn't pre-mine the coin in order to enrich himself and his circle. Instead he released accessible software that made it possible for anyone to mine it, enabling anyone with an internet connection to become apart of the nascent movement.
The concept of allocating pre-mined coins to early adopters is a practice that has nothing to do with Bitcoin, and if you ask any Bitcoin maximalist they will surely tell you the same thing. This is the fundamental difference between Bitcoin and other cryptocurrencies. Bitcoin isn't an exit scam designed to benefit its founder (although Satoshi has disappeared, so I suppose this isn't definite).
Bitcoin holders also don't view bitcoin as an investment. Most people, like myself, see Bitcoin as a way to store our savings. There is no intention of selling the coin. It's meant to function as a store of value, and when the time does come, i.e retirement, the Bitcoin will be spent, not sold. Once the market shakes out over the next couple of decades the world will be integrated with Bitcoin in profound ways, and it'l be easy for anyone to use it however they see fit.
People like to hate on crypto, and all the criticisms of crypto as money are valid, but they'd be remiss to apply their disapproval to Bitcoin. Bitcoin is the only coin that makes sense, the rest of the crypto currencies fit the description of a cult or scam.
Bitcoin has utility, it was built by people with genuine intentions, and it doesn't exist solely to enrich its founders. So keep hating on cryptocurrency, I hate on it too, but Bitcoin is different and unworthy of your attacks.
The only scam here is the title of this post.
You changed your own mind!
This comment I found genuinely hilarious because it's so hard to change peoples mind in crypto. Most people I know in the space have been holding the same viewpoints for years and its difficult to convince them of anything, whether that be Bitcoins advantages or disadvantages.
I wonder how long it's going to take for institutions/institutional investors to change their mind on Bitcoin, though. Many of them seem to be rapidly adopting it, and no ones talking about it. For example, JP Morgan and others are getting into the space despite the constant FUD in the media and it's only a matter of time before we see other companies besides MicroStrategy starting to own it in their reserves.
Once that happens, it'l be a simple game theory scenario where everyone will need it.
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Read the reasoning behind denial of Bitcoin ETFs and study it. You might see what is holding off the rest of the institutions.
from what I can tell they haven’t approved the ETF due to being concerned about investor protections. This reasoning doesn’t make much sense to me, though. There market is too large for one person to manipulate it. Look at the recent Luna BTC purchases, it didn’t move the market, in fact the price has actually fallen since then.
Well in my eyes it does makes sense. All of these stablecoins that have billions in marketcap and are traded in every major exchange haven't done even one audit.
Would you want to hold a "stable" asset that you don't know if it's backed and redeemable?
I read the title, read the first paragraph and jumped right here to say this:
Your intentions may have been genuine, but you don't get to deceive people into reading your content.
Click baiting is a scam, and a fast way to lose readers.
I'll be weary next time to read anything from you.
😤
I had no intentions of your deceiving you into reading my post. I suppose I just thought the title was a good one, but I'm sorry to see that you didn't like it. What would you like me to change it to? Fortunately, I can do so, and I will do so.
Hey, sorry about my rage comment.
I guess my brain just wanted something that correlated with the title 😅
No big deal, hope we're good ✌🏿
I don't think we can fairly frame the current state of a technology based on its founding ethos or philosophy. Everyone knows Bitcoin wasn't started as a scam, and had some legitimate (if, in retrospect, flawed) purpose - you can't escape the current reality though.
The world wide web wasn't founded with the intention to store violent imagery or addle the minds of millions, but that doesn't mean we can now proclaim it's pure and beyond reproach.
Whoever invented Bitcoin had good intentions, but it should now be consigned to the dustbin of history because it's simply become the capo dei capi of a vast pyramid scheme spanning the entire planet. It's deluded to still take the vision of Bitcoin as its status quo.
I don't want to to write off the blockchain and it's many myriad applications, I've been excited about it since first coming across Bitcoin in around 2013/14. In fact I regularly try out new applications of the tech when they come along, I'm just yet to see any use case that hasn't either failed, turned into a pyramid scheme, or become a vehicle for scams. At very least none of the applications have solved a problem that really needed solving.
I want to agree with you, but I'm not sure, really. Since Satoshi disappeared I've been more and more worried about him as a founder. While it's possible he could have died, and it's obvious he was brilliant, his disappearance raises more questions than it does answers.
When the main founder and creator behind a digital currency disappears, regardless of their online history, it looks suspect to me. Who is to say Satoshi isn't the Chinese government intending to destabilize the dollar? Without him here to defend himself I'm cautious to get involved, otherwise I'm just assuming his intentions.
Interesting theory about the Chinese government creating bitcoin, although I think the US Federal Reserve inflating the money supply has more to do with the destabilization of the dollar.
Look up Hal Finney. He was (in my opinion) most likely Satoshi. He died shortly after Satoshi's last post.
That may help with some of your concerns
The "founder" as you name his has no more control over his creation than you and me. Whatever his original intention was doesn't matter. Bitcoin is controlled by a network of miners who look after their self interest and the original programmer of bitcoin has no say anymore.
My largest criticism of most cryptocurrency in general and Bitcoin specifically is that it's an environmental disaster. The gargantuan amount of electricity used to solve meaningless math puzzles by Bitcoin miners alone is an unjustifiable nightmare, and that's before we even get into the mountain of GPUs and ASICs and all the infrastructure built to support them just sitting in warehouses doing nothing but fueling a 21st century tulip boom.
Bitcoin is terrible. None of the utopian purposes it's boosters pretend it has are actually happening - it's just a speculative investment vehicle with no underlying purpose or value, that has also incidentally made it much easier for criminals to get paid and launder money.
I commend your point of view.
It's worth noting,
Like any technology, Bitcoin has to go through the Technology adoption cycle.
I think Bitcoin is at the early "adopters' stage".
From an Innovator and early adopter point of view - your point of view is understandable.
It's the early majority, late majority & laggards ( the largest percentage of the population ) trying to jump into the "get rich quickly" stories they got sold to. It's true that people get scammed in the name of bitcoin/crypto. That shapes the story and testimonies we hear around.
With time, education will reach them(early & late majority).
With time, bitcoin will further be easy to hold and operate - digital wallet.
With time we will build all the bridges necessary to make it a valuable & understandable technology.
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Hey, great article!
I had one question if you do not mind answering; "It's meant to function as a store of value" But how does one identify or attach value to a digital currency?
Hey, thanks for your article.
But how do you prove this statement: "Bitcoin holders also don't view bitcoin as an investment. Most people, like myself, see Bitcoin as a way to store our savings. "
In my personal network, all bitcoin holders are doing only for the speculation part.
Has the title of the post been changed? I remember reading "Bitcoin is a scam. Change my mind" yesterday
Bitcoin per se can't be a scam. It is grounded in math and engineering, and math is not a scam.
A completely other thing is the price speculation. That has been around since we created the first communities, and especially after we invented banks. Bitcoin is not immune to that, like all other monetary systems (it is enough to remember previous financial crises).
That being said, as long as there is one miner mining Bitcoin in the world, it will be around. The last one will be mined around the year 2140. And miners will still have an incentive to mine (earning transaction fees).
So, how anyone feels about Bitcoin will not undermine the fact that it will be here for a long, long time.
Bitcoin has spawned many cryptocurrencies. I had an experience with one - not the best. Still, Bitcoin looks the most reliable of all.
what did the original title say?
Bitcoin is a scam! Change my mind
sigh, that's pretty cringe.
It's always concern but why scam? Are people know what they're talking? Everything in this world we can treat like it would be scam, money? Now is nothing real in it, food? Might be scam either 😂 what about people? 😅
I first bought bitcoin to use bitcoin. Because of this, I still view it as a valid asset, despite the hype.
I think it's clear to everybody who has any idea of the tech and community behind it that it's far from a scam. It's a great technical achievement of our generation.
That said, it only came this far because it was highly scrutinized and no compromises were made on the initial spirit of Satoshi's project. Every decision was fiercely defended.
I don't mind any attacks on it. If they're legitimate, it will only help strengthen the network. Most aren't and show a very superficial understanding of what it is, to the point where it's not even worth arguing against them. But that just counts as noise.
So Santoshi Nakamoto own these domains like bitcoin.org and Nakamotoinstitute.org but we still don't know his real identity. Seems like a govt is behind this.
bitcoin.org is owned by roger ver who is very much alive and one of the earliest proponents of bitcoin. he had a philosophical falling out with the core devs early on and actually forked the project into bitcoin cash. He is now considered to be the second most controversial figure in all of crypto behind Craig Wright (who claims to be Satoshi.)
When I say bitcoin is a scam I don't refer to the tech itself.
Some leads for my SaaS (Shopify for Telegram stores) ask me to add crypto payments, but when I ask what are they selling it's always an illegal stuff or a scam. So basically crypto allows them to get away with it, hence bitcoin is a scam in a wider sense.
Please don't put your savings into Bitcoin or any other extermely volatile and uncertain financial asset. Buy a couple of ETFs that track S&P 500 or similar indexes and leave your fingers off that money.
I agree it's not a scam. It is a trading opportunity though, including all the other coins. I'm working on a crypto trader that utilizes an Open Source client so that you don't even have to submit your API key (although that would be with minimal permissions for those that want to). https://tradecast.carrd.co
There is rumors it might drop below 20k here soon
It seems to me that you are arguing that the fundamental concept behind Bitcoin is not a scam. And that is something I entirely agree with.
You seem to be ignoring, however, some of the fundamental driving forces at the very root of human nature that make it a risky investment.
We are inherently selfish. It does not matter how much money you have. When we believe we have an edge, we lean on it and try to glean as much as we can from it for personal benefit. This is plain vanilla human nature and is undefeated in how it has manifested throughout human history.
In an unregulated market (and even in "regulated" markets like the US stock market) those with more buying power are far more influential than those without. The stock market tries to hide this with dark pools and various other measures, but it's fairly obvious they've only dampened the advantage, and not gotten rid of it altogether.
And the puzzling thing is that we all seem to realize and recognize there is corruption, but we willingly delude ourselves in the name of greed and getting what we feel we are entitled to. It's an entirely emotional reaction, and a very human one when we have a stake in something we have a personal desire to go in our favor.
There is nothing wrong with that. But anyone investing in a risky asset needs to be fully aware of the risk they are taking, especially considering that they are adding their money into a pool where less-than-noble actors are present and will absolutely use their buying power leverage to manipulate markets.
Especially in crypto markets where prices are not tied to tangible assets with projections and fundamental analysis backing asset values.
When you buy bitcoin, you're buying on a mountain of psychological belief from other traders and investors that it is going to continue going up. It is a speculative asset.
My main point here is that you need to treat it as a speculative asset where psychology is reigning supreme, and you need to tailor your risk accordingly.
I know far too many people putting everything they have into Bitcoin and it is honestly terrifying to me, knowing human nature.
I do not think it is a scam. I think it is essentially a digital collectible which disincentivizes its usage by being deflationary. The lightning network may address some market needs if it enables low free micro transactions, but usability is still rough.
I think it is also problematic that these coins are dressed up to look like stocks. I would not call them investments, it is purely speculation. It is nothing like buying a share in a company or some land, there is no way to price it.
A lot of stocks behave exactly like bitcoin. Owning them gives you zero rights, no dividends, your only right is to sell back. You are essentially betting that other people will buy and pump the stock.
Companies have financials. You're buying a piece of a company and that company's goal is to make profit. You can understand how it is priced against how much profit it brings in. Real estate has financials. You can see how much rent a property can produce. You can weigh that against a mortgage. Those are investments in my opinion.
You can, of course, also speculate on those. Know nothing about real estate and just buy houses, dump 15k into them, and turn around and hope to flip it. You can buy stocks and try to discern patterns in the charts that mean it is going to go up or down. You can play those same chart games with Bitcoin. You can not, however, invest in Bitcoin's fundamentals.
if a stock never pays dividends, how do I benefit from the company's fundamentals ? You might answer "because the stock will go up". But that's entirely the doing of other investors in the market, who will have bought the stock because it's popular. That's the exact same mechanism pushing up Bitcoin's valuation.
That is a serious reduction. A 1/N share of a company becomes more valuable when the company goes from making $X per year to $X+1 per year. A bitcoin becomes more valuable because someone else wants it. Going back to my first comment, they are digital collectibles. Limited edition. Only 21 million ever produced.
Given the choice between real estate in Los Angeles or bitcoin. I will take the LA real estate every time. It doesn't rely on celebrities tweeting about it for me to have income. You can rent out portions of it for money. Pretty amazing in comparison honestly.
Rather than telling me why it is like some penny stocks, can you make a case for why it is better than real estate or strong business investments?
My stance is you can not produce anything from raw bitcoin, you can not rent out portions of it, a bitcoin does not entitle you to future profits of some entity, and using it does not save money over alternatives in a way that can scale to widespread adoption. With all that said, talking about a coin's market cap seems laughable.
It's not. You know it. I know it. That's all we need to know ;)
Bitcoin is a fantastic store of value, especially with all the inflation we're all expecting to happen in the next several years.
A lot of us will have had parents that taught us to save, save and save for the future. That is no longer wise advice, as what you're saving will fall to zero in 5-10 years. The best way to save (for the long term), is to buy Bitcoin.
Sure, Bitcoin is just zeros and ones, therefore its value is only in its perceived value. But much the same could be said for gold, which has lasted as a store of value for over 5,000 years and outlived every single fiat currency that has come and gone in that time.
And yes, unlike Bitcoin, gold does have some utility. However the market price for gold is not aligned at all to its actual utility.
When your parents tell you to save, isn't it implied that you must invest in an instrument that overcomes inflation ? Like stocks or real estate. What kind of idiot would save and let their money sit in cash ?
Nope, investing is different than saving.
I don't think we should change or dilute the meaning of words.
Sadly, in today's inflationary world we're forced to invest as a form of saving.
One of the main advantages of hard money, is to be able to save for the future with as much security as possible.
I have a small amount in crypto just in case, mostly Bitcoin. I don’t see any reason why it couldn’t become an alternative to gold and other stores of value that are negatively correlated to the stock market. Only time will tell.
At the moment it is heavily correlated with the stock market so it isn’t there yet. And I know the die hard crypto crowd speak as if it is inevitable, but we have no idea what will become of it. It may become a store of value, it may disappear, or a million options in between. Anyone that claims what will happen is purely speculating and there are too many variables to predict it.
I find the savings argument sketchy. If there wasn’t the potential to outperform the market I think many people would skip Bitcoin for safer options. Given its lack of historical track record and extreme volatility the risk is only worth it if the reward is there. Only the die hardship (and people in countries without properly functioning monetary systems) are in it to store in their own offline wallet for extreme security.
We will see what it becomes, and I’ll keep some money in there as I do see a potential successful path, but there is still a lot of risk and a lot of unknowns.
I'm not sure about Bitcoin being a scam, but NFTs make me question my sanity.
The $2 trillion market can never be a public service. Change my mind 🤑
Pre-mining is only a single way to scam in crypto. This doesn't make bitcoin scam-free.
I don't get the difference in between investment and storing savings which yields interests.
I'm not taking any sides, IDK what maximalist or minimalist stands for however I wouldn't say bitcoin was a scam but after this post; I think bitcoin is a scam.
It promised to replace fiat. After IDK how many years, it's not even trying.
Fluctuating the whole market for those coins trying to replace fiat. 🤷♂️
Making it more complex for average joe. Those hoops to jump to make a single transaction.
Fees. I don't even know how much does it cost to make a transaction but in my mind it's always more than necessary.
So bitcoin and the whole crypto eco-system has a long road ahead. Imagine something needs to be explained as a non-scam.
I'm actually here and there when it comes to cryptocurrency. But recently I came across a video and it seemed to make a lot of sense. If you think crypto is a pyramid scheme, then you're in for a surprise.
Have a look at this video
"Bitcoin holders also don't view bitcoin as an investment. Most people, like myself, see Bitcoin as a way to store our savings."
This is the absolute worst way to look at Bitcoin considering the volatility and lack of regulation in this space. It's not a scam, but it is a market-based gamble, just like the stock market. Value will probably improve, but there will be high volatility that erases huge value. Using it as a savings plan is the last thing anyone should do because there's zero guarantees.
And what would you use as a savings plan instead?
"Savings" is for safe investments. High-interest savings accounts, CDs, etc. They aren't beating inflation right now, which is fine – sometimes they won't and that's a consequence we all have to live with.
Invest in Bitcoin if you want! But only invest what you can afford to lose, and stop calling it a savings plan, because you're going to end up losing your shit when the unpredictable happens. People act like just because the bottom hasn't fallen out in the past 10 years doesn't mean it won't. But volatile markets like Bitcoin always end up shitting the bed at one time or another, so to rely on them with money you need to maintain a basic quality of life if the worst happens is a terrible idea.
The current best CD rates are 2%. With an 8.5% headline inflation and real inflation of 10-15%, you are actively LOSING 6.5% (at minimum of your "savings". And this is just the start. If the govt. decides to print more money, expect that to drop even further.
Unlike the corrupted central bank money, bitcoin cannot be debased. Yes, it is volatile, but if you are looking at decades, it's more safe than the GUARANTEED losses of your fiat. Nobody over the course of 2 years has been in the negative in Bitcoin. Nobody. Check it if you don't believe me.
You can also go park your $ in bubbly assets like stocks and real estate. Everyone is getting rich on that now, until it all tanks. Don't understand how that works? Watch "The Princes of Yen" on YouTube. Come back when you have.
Again: Invest in bitcoin only what you can afford to lose. Any advice to treat bitcoin as "savings" is dangerous and irresponsible.
It depends on timeframe how you define shitting the bed, for any period over four years which is an appropriate amount of time for investors with a long term mindset, BTC has posted at a minimum 300+ gains. And that's if times it badly, so how is it shitting the bed?
You seem confused about the difference between saving and investing. I'm not telling people not to invest in bitcoin, but again: the point is, only invest what you can afford to lose.
The stock market has had MULTIPLE crisis-level bottom-outs in the past 100 years. The same will happen with bitcoin eventually. And the stock market has also recovered – soaring to amazing heights following those bottom-outs. So you're right in the sense of "if you put money in and keep it there for long enough, you'll probably be fine."
But that time horizon is different for everyone! If you're 20, you can afford 50 years of volatility, but you also want to move your money into more conservative vehicles as you get closer to retirement. If you're 65 and planning on retiring in the next 10 years, bitcoin is not a "savings vehicle" to sink your retirement savings into. What happens if it crashes in 7 years and takes 5 years to fully recover its value – you're basically starting from scratch. And when you're 65, 70, are you really going to think "bitcoin is a safe place to save my meager new earnings after that massive crash!"
Or worse, what if the economy blows up like it did in 2008 and bitcoin also loses its value and – as a result of the economic collapse – you also lose your job? Then what?
Where else do you put your money when inflation is at ~8.5%? The stock market is extremely volatile too, and is behaving much like the crypto market, seeing massive volatile swings downward and upwards. At this point, Bitcoin and the stock market aren't behaving too differently from one another, which is a positive for Bitcoin.
See my other responses. Bitcoin is not a savings vehicle.
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