All Cyber ‘Money’ Is Collapsing In Value…DUH

As I predicted:  Bitcoin, Ethereum Plunge Accelerates As Scaling Deadline Looms | Zero Hedge reports.

 

While the main driver of this selloff is undoubtedly anxiety over the looming scaling deadline on August 1st, we note that, as CoinTelegraph reports, none other than the Albanian central bank has joined the chorus warning about the dangers to the public of virtual currencies

 

HAHAHA…when the Bank of ALBANIA points out the obvious, then it is obvious.  Virtual currencies are backed up by nothing.  Absolutely nothing.  They are basic ‘conspiracy/trade’ items.  Believers believe in the value of these fake things and voila: they are worth something to believers.

 

I recall history here, the Catholic Church sold insurance protection from demons in hell.  If you gave some money, this would erase all sins and one could die happily unaware this was a scam.

 

Then along came troublemakers who showed how this was all a scam and this is called ‘the Reformation’ and led to very violent warfare between magic sin forgiveness believers and skeptics who had other goofy beliefs.

 

Bitcoin and other cryptocurrencies have been making headlines around the world, and with the recent sell-off this week, more is sure to be said. Central banks and governments continue to make statements regarding the dangers of digital currencies, or, conversely, extolling their benefits.

 

Duh, central banks love fake money.  Ever since paper money was introduced, they all ran off to play with it.  Germans, being efficient, ran to infinity with paper money.  Way back in the 1930’s, everyone knew that paper money easily degrades but all governments solemnly swear they won’t degrade paper money.

 

Cybermoney doesn’t even have a government to go after if things go wrong.  It is totally fake and not mostly fake.  I still have coins and if I choose, I can have somewhat degraded coins which still have some physical value.  Nickels, in particular.

 

The most recent bank to issue such a warning is the central bank of Albania. The bank issued a strong statement warning citizens that digital currencies were not under the direct purvey of the country’s banking sector regulations and that such vehicles carried extremely high levels of risk.

 

Not only are ‘bitcoins’ disintegrating, so is another recent fake money venture, ‘Ethereum’.  HAHAHA.  What a solid, concrete name!  Well chosen.

Chasing willow’o’whisps is fun until one falls into a swamp filled with very physical crocodiles swimming around, hungry.

25 Comments

Filed under .money matters

25 responses to “All Cyber ‘Money’ Is Collapsing In Value…DUH

  1. Lou

    Elaine, with your scientific mind and writing skills, please do a thread on Block chain, for the ordinary folks like me.

  2. Jim R

    Elaine has spoken. Therefore, the trend changes today … all clear for $10,000 BTC!

    (And, Albania isn’t really that much of an international banking hub … )

  3. floridasandy

    All currency is worth what people think it is, including our dollars.

    Bitcoin is no different, nor is Etherium.

    Central banks hate the competition.

  4. floridasandy

    OT, the cop who shot the woman in Minneapolis:

    Black Somali diversity hire police officer shoots unarmed White Woman (from Australia) in Minneapolis MN

    Cant find a single national headline saying a black cop shoots unarmed white woman anywhere.

    http://minnesota.cbslocal.com/2017/07/17/mpd-officer-shot-woman-identified/ (black Somali cop)

    http://m.startribune.com/woman-killed-in-officer-involved-shooting-in-south-minneapolis/434782213/ (Unarmed white woman (end)

    me neither, just saying.

    We could use a more honest media and then everybody would probably get along better. There is right and wrong everywhere.

  5. Lisa

    I’m reading a book called “For the Win” by Cory Doctorow. It’s a fiction book about people making money in online games by working as “gold-farmers” in the games. More about the book is here:

    As I’ve been reading it sounded so familiar; people mine fake gold in the games that was worth real money in the real world, but valuable only so long as the game was popular. It looks like Bitcoin is video game money but without the game.

  6. It is a FAD. Fads come and go. Remember hoola hoops? I remember these! I remember many, many fads. All of these also generate large sums of profit of some sort. The collapse is always faster than the rise.

    Humans love fads. These can be endless. People fight wars for fad items, after all!

  7. Jim R

    Lisa, the gold-farming phenomenon that Cory writes about is a real thing. Has been for more than a decade, I believe.

    It happens in countries where there are lots of poor people with computers and good internet access, like South Korea. They’ll play a multiplayer online game like World of Warcraft, which has its own in-game “money”, and then they’ll sell the game tokens to lazy jerks who don’t want to work that hard, but are willing to pay to be big shots in the game.

  8. Lisa

    Jim, I’ve known about online game gold farming for a while, but the specifics described in the book are so very similar to acquiring Bitcoin. So I wonder if Bitcoin is just a video game without the game part.

    You can also buy Facebook friends, likes, and website traffic from Asia. None of it is real but it will increase your ranking on Google.

  9. Jim R

    Lisa, the Mtgox exchange used to trade in game money. Its initials stood for “Magic the Gathering Online Exchange”. The guy who started it was going to create something like eBay for trading virtual game stuff.

    He started trading in Bitcoins early, back when they were valued at a few cents or dollar or so. His computers and company were located in Japan, for reasons I do not know.

    At some point, he succumbed to the temptation to sell Bitcoins he did not have, essentially turning his non-financial ‘exchange’ into a ponzi operation. He is currently in hot water with the Japanese financial authorities. (I’d think if he did same in the USA, they’d probably let him off like the banksters in 2008) He’s clearly a Gaijin from the pictures, and the Japanese financial regulators are not all that nice..

  10. Jim R

    Lisa, the Mtgox exchange used to trade in game money. Its initials stood for “Magic the Gathering Online Exchange”. The guy who started it was going to create something like eBay for trading virtual game stuff.

    He started trading in Bitcoins, back when they were valued at a few cents or a dollar or so. His computers and company were located in Japan, for reasons I do not know.

    At some point, he succumbed to the temptation to sell Bitcoins he did not have, essentially turning his ‘exchange’ into a ponzi operation. He is currently in hot water with the Japanese financial authorities. (I’d think if he did same in the USA, they’d probably let him off like the banksters in 2008) He’s clearly Gaijin from the pictures, and the Japanese financial regulators are not all that nice..

  11. Ken

    Elaine,

    If you’re going to hoard nickels for their intrinsic value, be sure to only keep the old one. Several years ago the US Mint stopped putting the metal nickel into “nickels” because of the cost.

    You can use a magnet to test your nickels to see if they contain any actual nickel metal. Like iron (but to a lesser degree), nickel will be attracted to a magnet.

    Also, the Canadian nickel contained the acutal metal for longer than the US nickel. Since you live near Canada, you may be able to pick up some of their nickels.

  12. Yes, I saw that news. Pennies and such began to be more valuable as a metal than as ‘money’ so it is mostly zinc now. This degrading of the money became much easier with computers and people no longer using paper and metal ‘money’.

    ‘Money’ is a thing created by powerful central governments. It was invented around 2,500 years ago by empires. They usually evolve into IOUs instead of ‘useful metals of some sort of intrinsic value’. Early on, governments learned how to degrade these coins look at Roman coins, for example.

    The metal value was diluted to nearly zero by the time the empire collapsed entirely and the barbarians reverted systems to the older barter/steal systems.

  13. Jim R

    Those old Roman coins continued to be used, however, in trade all over Europe. Even the crappy pewter ones, for centuries after the Empire had rotted away to nothing.

    The value of the coins was based on their usefulness as money. Even in a mostly barter economy it is useful to have some tokens to exchange in place of the chickens or cabbages or whatever.

    Of course electronic tokens are not so useful unless you have an electronic network for them to exist in.

  14. Not true.

    In England, for example, all over open fields people even today find endless Roman coins scattered everywhere. The use of ‘money’ vanished. The use of GOLD did not vanish at all.

    Real gold Roman coins were valuable. Not for business but for HOARDING. The Catholic Church was a huge hoarder of gold. Gold coins were used for ransoms and marriages, not ‘business’. Business was pretty much dead during the Dark Ages, for example.

    It vanished in England, totally. Silver coins were melted down and used as decorations on weapons and jewelry. Even up to modern times, ‘coins’ were used in Africa and parts of Asia as bridal dress materials showing ‘value’ of the bride, not business.

  15. Jim R

    As for the electronic tokens, it’s worth noting that if the electronic network fails we will also not be sitting around here talking about it…

    There are ‘silver’ Roman coins which were used until the markings wore off. The WERE used in commerce, because it was the only medium of exchange other than barter. And yes, the nicer silver and gold coins, would tend to end up in a hoard.

    What’s interesting about Bitcoin is that it is the first truly international currency, not “backed” by any army or religious organization. Interesting in that the internet is enough of a “place” now, that it can even exist. How temporary will it be? How temporary is the dollar? The dollar empire is still enormous and powerful, but cracks are appearing in its foundation, and there are signs of termites all over it.

  16. Moe

    McAfee Makes Big Bet On Bitcoin

    McAfee has been notoriously outrageous over the years. Looks like nothing’s changed.

    http://libertyviral.com/mcafee-makes-big-bet-bitcoin-not-will-eat-dick/

  17. Jim R

    As I was saying, Elaine’s theory about the BTC correction is completely wrong. It had nothing whatsoever to do with that stupid ‘ransomware’ attack on random Microsoft users.

    It was a disagreement among the nerds who maintain it about how to handle a technical issue that has cropped up as a result of its popularity. It was getting too slow and the ‘blockchain’ database was getting too large and unwieldy. So there were some different changes proposed to deal with those problems.

  18. Lou

    12– In 1982 USA pennies were changed from Copper to Zinc. Some 1982
    pennies are copper. Nickles are not [made of nickles].

  19. ANYTHING wildly swinging from hour to hour is DANGEROUS and UNSTABLE in the extreme. It cannot be used for any commerce because of instability. Mixing up the fun and games of playing with fake money can be fun but its very instability means it is useless for contracts or wages or anything real.

  20. Bit coins are as unstable as Venezuelan ‘money’. 🙂

  21. Jim R

    If you’re trading, volatility is life. Anyway, your precious dollar isn’t all that stable. Most of THEM are on the electronic network as well. And if you look at the long term 1/BTC chart, the dollar has been steadily sinking the whole time.

    Furthermore, if the army is doing such a swell job of protecting the value of the dollar, howcome a barrel of oil isn’t still $20? Howcome an ounce of gold isn’t still $35?

  22. Good lord, shooting upwards then crashing then whatever isn’t ‘volatility’ that is GOOD. It is like driving off a cliff, landing in a river then driving up to the next cliff: this always ends badly.

    The dollar is in trouble for political reasons. Investing wealth to make it ‘grow’ is totally different from making up a fake ‘money’ and then playing with it with other ‘insiders’. This is Tulip bulb territory.

    The money degrading is Roman empire falling territory which is very bad. Fake money doesn’t fix this! It is a childish way of dealing with real reality.

    Real reality is what I have: guns (and swords, for that matter) and large property, etc. That is ‘power’ in a declining empire. Forming a personal army is part of this, too. Have done this in the past when I trained people in medieval fighting tactics.

  23. I was amazed when the media demanded people save someone drowning. Saving drowning people is very dangerous, one can drown, too. In fact just last month two men drowned trying to save people in a rip tide.

  24. Jim R

    So here’s one thing that can happen when internet-based money comes up against gun-based money. Little problems with the server …

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