oppn parties Is Bitcoin Headed For Zero?

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  • In reply to a question in Parliament, the government says it is empowered to lawfully intercept, monitor or decrpyt information stored in a computer resource in the interest of sovereignty or integrity of India
  • Police stop a 12-year old girl on her way to the Sabarimala shrine
  • In Karnataka, the JD(S) indicates that it might support the BJP government if it falls short of numbers after the bypolls
  • Congress pips the BJP in local body elections in Rajasthan, winning 961 wards to the BJPs 737
  • After Airtel and Vodafone-Idea, Jio also indicates that tariffs will be raised from December
  • Sources in Shiv Sena say that they might revive the alliance with the BJP if it offers the 50:50 deal
  • A miffed Sanjay Rout of the Shiv Sena says that it will take "100 births" to understand Sharad Pawar
  • Mobile operators Vodafone-Idea and Airtel decide to raise tariffs from next month
  • Sharad Pawar meets Sonia Gandhi and says more time needed for government formation in Maharashtra
  • Justice S A Bobde sworn in as the 47th Chief Justice of India
  • Supreme Court holds hotels liable for theft of vehicle from their parking area if parked by valet, says "owner's risk" clause is not a shield from such liability
  • Finance Minister says she is receiving feedback from many sectors that recovery is happening as there is lower stress
  • Sabarimala temple opens, but police bar the entry of women below 50 years
  • Finance Minister Nirmala Sitharaman says Air India and BPCL to be sold off by March
  • Media person Rajat Sharma resigns as DDCA president
Two Muslim litigants in Ayodhya refuse to accept the Supreme Court order, say review petition might be filed
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Is Bitcoin Headed For Zero?

By Sunil Garodia

About the Author

Sunil Garodia Editor-in-Chief of indiacommentary.com. Current Affairs analyst and political commentator. Writes for a number of publications.
Is Bitcoin headed for zero? At least one expert, Jeff Schumacher, otherwise very upbeat on the blockchain technology, thinks so. He echoes the sentiments of billionaire investor Warren Buffet who had said that “you can’t value Bitcoin as it is not a value producing asset”. Schumacher also said that “I think it’s a great technology but I don’t believe it’s a currency. It's not based on anything."

While Schumacher and many other experts are totally taken in by the blockchain technology, they are not much enthused by its use to develop coins or currency units that are not backed by anything and are drawing the attention of financial regulatory authorities across the world. Most central banks believe that they cannot allow a parallel financial system to exist, even if backed by cutting edge technology.

Hence, while blockchain technology is taking giant strides and the next generation platform is already under an advanced stage of development – it will bring in “open decentralized systems” – the future of Bitcoins and other me-too products are under a cloud. Tidjane Thiam, CEO, Credit Suisse Group AG put it succinctly when he said that “from what we can identify, the only reason today to buy or sell Bitcoin is to make money, which is the very definition of speculation and the very definition of a bubble.” Chinese billionaire Jack Ma, the founder and chairman of Alibaba also held similar views when he said that “blockchain technology could change our world more than people imagine. Bitcoin, however, could be a bubble.”

It is true that cryptocurrency does not meet the four basic requirements for it to be called or treated like other currencies – it is not backed by anything, it does not produce any value, it is not supported by any government or central bank and it is not widely accepted, either internationally or in any defined geographical area. It is also true that those who are making an investment in these so-called currencies are driven more by greed than any long term view of it gaining acceptance. Hence, the day is not far off when not even the complex algorithms that go into the making of a Bitcoin will be able to save it from extinction.