New Survey Reveals Staggering Number Of People Are Buying BitCoin On Their Credit Cards | Zero Hedge: this is classic, the last legs of a mania. The infamous Tulip Mania ended when people were putting their homes into hock to buy tulip bulbs for speculative purposes. Note how alarmed authorities are now cracking down on fake money used for crime or wild speculation. The cynically named ‘Ethereum’ scam shot upwards last week and now is nosediving. This is insanely stupid.
A few weeks ago we presented anecdotal evidence from Joseph Borg, director of the Alabama Securities Commission, suggesting that people are taking out home equity loans and cash advances on credit cards just to purchase BitCoin in the hopes of getting rich quick (see: “It’s In The Mania Phase”: Securities Regulator Warns That “Mortgages Are Being Taken Out To Buy Bitcoin”)
This is beyond stupid. People are not spending money on something that is useful except if one is a criminal and needs to hide where the money is really going. Using money to buy ‘money’ is akin to stamp collecting or other collectables all of which depend on scarcity so that the people speculating can cite rarity as an asset.
“We’ve seen mortgages being taken out to buy bitcoin. … People do credit cards, equity lines,” said Borg, president of the North American Securities Administrators Association, a voluntary organization devoted to investor protection. Borg is also director of the Alabama Securities Commission.
Here is an ad at Zero Hedge peddling bitcoins for ‘retirement wealth’:
This pure, useless speculation, when leading to bankruptcy, is highly dangerous. This hits real banks and real money systems. The scam artists who started this insanity will be arrested for fraud. All scams that lead to insane bubbles end up with the creators going to prison.
“This is not something a guy who’s making $100,000 a year, who’s got a mortgage and two kids in college ought to be invested in.”
Stupid people take on say, mortgages, to play the stock market when there is a mania. I had an ancestor who committed suicide in the late 19th century due to speculation in the markets and taking on debt to do this. My grandmother ended up on a religious farm with two grand aunties and had an adventurous life instead of a stifling Victorian upbringing in high society.
“You’re on this mania curve. At some point in time there’s got to be a leveling off. Cryptocurrency is here to stay. Blockchain is here to stay. Whether it is bitcoin or not, I don’t know,” Borg said in an interview with “Power Lunch.”
The stupid cryptocurrency is not ‘here to stay’. Its only use is for crimes where one has to hide one’s ‘money’ from prosecutors. Once this silly game explodes in everyone’s faces, the government will regulate it rendering it useless as a way of hiding drug dealing money.
It isn’t hard to outlaw this ‘money’. Any fraud can be outlawed. Using computer programs to create ‘scarce wealth’ is a scam and like all previous scams, will end up being outlawed. People using fake money between themselves can continue but it will be strictly underground, aka, illegal just like the drug trade it supports.
All the ‘smart people’ who are scamming others will end up being sued for fraud when this business collapses. It is a very obvious fraud! People compare this to gold. Gold is not a fraud. Gold has various uses as a metal and it is very durable, it lasts pretty much forever.
I vividly remember the birth of the computer chip: we used GOLD to conduct electricity! I made prototypes and when making these, I used very thin sheets of gold. Bought it in very small bundles with paper between each sheet of gold. The room I was in couldn’t have air blowing when using gold because it would waft away the gold sheets while handling them.
Why is this concerning? The virtual currency exchanges where Bitcoin is bought and sold will charge conversion fees when either a credit or debit card is used to find an investor’s account. Coinbase, the largest of the cryptocurrency exchanges, charges a conversion fee of 3.99 percent when a user uses his or her credit or debit card to bankroll their account.
HAHAHA. If speculators aren’t pushing this scam upwards, the ‘use as money’ aspect collapses. You have to pay a penalty to use it. Virtually none of this is used to conduct business. It is much more like stamp collectors selling stamps to each other.
Obviously, this is not the most financially-savvy move on the part of of a sizable percentage of Bitcoin investors; no one ever wants to pay extra than what is necessary, especially when dealing with something as volatile as Bitcoin. The wisest and most frugal way to fund a virtual currency exchange account would be through an ACH transfer, which is completely free of charge. Only 18.60 percent of our 672 Bitcoin-invested respondents were paying for the cryptocurrency in this fashion.
So, there are only around 700 clowns who are doing the ‘free exchange’ where you can transfer bitcoins to other accounts which are also bitcoins. This is so stupid. Why do this? How worthless.
Drug dealers aren’t going to keep accounts like this! They need to be not traced or tracked! And why on earth would one use ‘money’ that has reverse interest? When I park money in my bank, it earns interest while in the right account (ask around for this!). I don’t pay a penalty for saving money! Who is so insane as to do that? A ‘money system’ that depends on speculators pushing its value upwards all the time is just as bad as inflation caused by money printing. It is reverse inflation and has the same tendency to go to infinity if people are stupid.
More stupid news about a stupid con scam: Bitcoin Mining Fees Soar As China Crackdown Progresses | Zero Hedge The ‘mining’ of this fake scam ‘money’ is very expensive. It consumes real resources. It is a monumental waste of all energy systems. This is one main reason governments are now cracking down on this scam:
Indeed, many miners have already fled to Canada, the US – even as far away as Iceland. But those that remain are being squeezed by market forces as local authorities seek to deny them access to the cheap, subsidized electricity that allowed Chinese miners to flourish in the first place.
This abuse of all energy systems in a scam is part of why governments will eventually put all these creeps in prison. They are causing system problems for all other users who are not abusing energy systems.