The Bank of England says Bitcoin could become 'worthless'

[midian182]

A hot potato: Bitcoin is by far the most popular and well-known cryptocurrency, but BTC still has its detractors. Within that category is the Bank of England, which warns that those investing in the crypto should be ready to lose everything as it could at some point become “worthless.”

Bitcoin, like most crypto, often experiences wild price fluctuations: it has dropped by $20,000 in the last month. However, it’s worth remembering that one Bitcoin at its current price of $48,500 is worth almost five times the $10,000 price it sat at just 14 months ago.

But the Bank of England’s deputy governor, Sir Jon Cunliffe, has warned of the risks associated with crypto investment. “Their price can vary quite considerably and [bitcoins] could theoretically or practically drop to zero,” he told the BBC.

The Bank said that major institutions should take a cautious approach to adopting crypto assets and that it would pay close attention to developments in the market, writes The Guardian.

“The problem is that, unlike traditional forms of money, Bitcoin isn’t used to price things other than itself. As Bitcoiners themselves are fond of saying, ‘one Bitcoin = one Bitcoin’. But a tautology does not a currency make,” wrote Thomas Belsham, an employee in the Bank’s stakeholder and media engagement division.

Belsham added that the scarcity and limited nature of Bitcoin—no more than 21 million Bitcoins can ever be mined—“may even, ultimately, render Bitcoin worthless.”

Around 18.9 million Bitcoins, or 90 percent of the total supply, have now been mined, but the network is designed in such a way that the final coin won’t be mined until 2140. Belsham still warns that sustaining this system could become more difficult over time.

“Simple game theory tells us that a process of backward induction should, really, at some point, induce the smart money to get out. And were that to happen, investors really should be prepared to lose everything. Eventually.”

Government agencies’ views on Bitcoin and cryptocurrency in general tend to vary from country to country. Sweden has called for the whole of Europe to ban crypto mining over environmental concerns, while China has declared all crypto transactions illegal. El Salvador, by contrast, was the first nation to accept Bitcoin as legal tender and plans to build an entire city based around BTC.

h/t: The Guardian

Permalink to story.

https://www.techspot.com/news/92639-bank-england-bitcoin-could-become-worthless.html

 

[Puiu]

I don't think crypto s going to go away, but I do feel like its value is inflated right now. Once mining becomes much harder (close to impossible for the average Joe) we'll most likely see a lot of people dumping they wallets.

 

[Nobina]

I can theoretically shove a pineapple up my *******.

 

[R00sT3R]

I can theoretically shove a pineapple up my *******.

Well, if you're a miner, I volunteer to do it to you, blunt end first.

 

[RedGuard]

Well, the less Bitcoin are going to be created, the more appeal it will generate.

I'm all for assets not controlled by anyone, but I have to admit that Bitcoin showed us that the value of everything is just given by people. Even dollars can become worthless if a lot of people deem it so.

On the other hand it shows us, humanity, that we haven't reached Star Trek levels. We continue to scour for value in the weirdest places. It'll still be some time until the concept of "money" won't mean anything and humanity will look at other concepts for value.

 

[captaincranky]

I can theoretically shove a pineapple up my *******.

Film at 11:00?

 

[Kosmoz]

Actually all current currencies, FIAT and crypto, will all become worthless and obsolete, once "they" manage to implement the one and only world wide currency, the one to rule them all.

It's not a matter of if, but of when. First they need to destroy everything, to build this "new hope lie" from zero... it's just not that easy to do, but at one point it will happen, it's in the plan.

Until that happens, all cryto including BTC will not die, it will just continue to be a wild wild west roller-coaster of "schemes and speculations"...

 

[stewi0001]

Crypto has always been worthless in my opinion. Still kind of surprised (and not at the same time) how people can make a string of characters worth so much.

 

[Puiu]

Crypto has always been worthless in my opinion. Still kind of surprised (and not at the same time) how people can make a string of characters worth so much.

It's the network itself that is worth money, not the characters.

 

[Tawhid]

And how much is a pound worth? One pound now is worth considerably less tomorrow, while bitcoin would worth exactly the same. If an apple costs $1 now, it could cost 0.5$ or 1.5$ tomorrow... So, how is the pound stable compared to BTC? At the very least, BTC printing is not controlled by a centralized institution that can operate for its own gain.

 

[captaincranky]

And what does pound equal to? one pound today is even less tomorrow, at least bitcoin equals it self. if one apple today is 1$ tomorrow it can be .5 or 1.5$... so how is pound stable then BTC...

You know, when you put up crap like this, with poor syntax, missing articles, and even wrong words, it destroys your credibility.

Here is a corrected sample: "so how is the pound more stable than BTC"?.

 

[gamerk2]

Well, the less Bitcoin are going to be created, the more appeal it will generate.

Technically, yes, but not in a good way.

What happens in situations where money supply becomes tight is that people view their money as being more valuable then anything they can purchase with it. The end result is that people just stop spending money, choosing instead to try and barter with other goods. No reason to think Bitcoin would be any different in this regard.

...well, except for the fact it's value is entirely market driven, so at that point if the price enters any sort of decline you could see the entire currency dumped over a very small period of time.

 

[Shadowboxer]

Crypto is particularly valuable right now because inflation for existing world currencies is rampant. If you have a lot of cash then you are best off buying Bitcoin with that cash and watching its value increase than you are keeping it in a bank and making a measly 2% interest at best, whilst global prices hike up by much more than that. Buying crypto last year would have given you a better return on investment than anywhere else I can think of outside straight up gambling.

As soon as global banks raise interest rates to fight the rampant inflation the value of crypto will tumble down as it will be less appealing to dump your money into it and folks will be selling their cryptos to buy currency.

 

[David97000]

Well of course it could be worthless. It’s value proposition. I go to the market with bit coin in my pocket. How many tomatoes can I buy? It depends. Does the tomato seller accept bitcoin as legal tender? If they can use it to buy potatoes, maybe the do accept it. If all I can buy with bit coin, Is more bit coin, then why would I bother? The success of bit coin depends on two factors. The first is the failure of an accepted and trusted form of currency. The second is is the acceptance of bitcoin as a replacement. The primary reason that he USD is accepted is because the U.S. is legally bound to repay all debt. Which means constitutionally, the U.S., unlike much of the world, is constitutionally unable to cancel its debt. So as the U.S. exists, I’m going to bet on the dollar. If that changes, I’m jumping to crypto, but not until.

 

[rrwards]

Crypto is particularly valuable right now because inflation for existing world currencies is rampant. If you have a lot of cash then you are best off buying Bitcoin with that cash and watching its value increase than you are keeping it in a bank and making a measly 2% interest at best, whilst global prices hike up by much more than that. Buying crypto last year would have given you a better return on investment than anywhere else I can think of outside straight up gambling.

As soon as global banks raise interest rates to fight the rampant inflation the value of crypto will tumble down as it will be less appealing to dump your money into it and folks will be selling their cryptos to buy currency.

Idk about anywhere else in the world, but there's no savings accounts / checking accounts in the US that offer even 2% yields. High yield savings accounts are often at 0.5%.

 

[m4a4]

Theoretically, the internet could shutdown completely.

Only feeding the "trolls" with this one lol

 

[Shadowboxer]

Idk about anywhere else in the world, but there's no savings accounts / checking accounts in the US that offer even 2% yields. High yield savings accounts are often at 0.5%.

Yeah that’s true of the U.K. actually, interest rates are at 0.1% nationally. I have seen ISA rates at 0.93% but it had about 7 asterisks next to it that I didn’t read. I have a mortgage so I’m happy with the low rates. I just said 2% because I’m still living in the past and also because that’s what I get paid extra every year before performance related pay rises.

 

[mrvco]

"Worthless" is an overstatement. If anyone doubts that, I'll pay $1 for a Bitcoin for the nostalgia.

 

[VaRmeNsI]

Once the stable coins are no longer able to be printed out of thin air to pump up crypto, the house of cards will collapse, much is the same with the stock market, pumped up with fiat currency.

 

[Nobina]

Well, if you're a miner, I volunteer to do it to you, blunt end first.

I'm not a miner. Do not violate my anus.

 

[QuantumPhysics]

$46,000 now

The dip that keeps on dipping!!!

 

[Tawhid]

You know, when you put up crap like this, with poor syntax, missing articles, and even wrong words, it destroys your credibility.

Here is a corrected sample: "so how is the pound more stable than BTC"?.

Thank you for reading and comprehending my terrible English; however, instead of pointing out that English strengthens the pound, it would be far more valuable if you had contributed something.

 

[wiyosaya]

Well, the less Bitcoin are going to be created, the more appeal it will generate.

I'm all for assets not controlled by anyone, but I have to admit that Bitcoin showed us that the value of everything is just given by people. Even dollars can become worthless if a lot of people deem it so.

On the other hand it shows us, humanity, that we haven't reached Star Trek levels. We continue to scour for value in the weirdest places. It'll still be some time until the concept of "money" won't mean anything and humanity will look at other concepts for value.

Agreed! As I see it, until humanity reaches something like those Star Trek levels, "value" will be in all the wrong places, and humanity will have systemic problems that it will wonder "why is this not working".

 

[wiyosaya]

"Worthless" is an overstatement. If anyone doubts that, I'll pay $1 for a Bitcoin for the nostalgia.

Well, there's always "collectors" in search of "collectables."

 

[defaultluser]

Actually all current currencies, FIAT and crypto, will all become worthless and obsolete, once "they" manage to implement the one and only world wide currency, the one to rule them all.

It's not a matter of if, but of when. First they need to destroy everything, to build this "new hope lie" from zero... it's just not that easy to do, but at one point it will happen, it's in the plan.

Until that happens, all cryto including BTC will not die, it will just continue to be a wild wild west roller-coaster of "schemes and speculations"...

That will never happen - there are always national holdouts (see: British Pound in EU)

And Cryptocurrencies will never consolidate either- they are all powered by by Open Source 5-year-old mindset: "Anything you can do I can do better"

Get used to ignoring the fact that there are thousands of Cryptocurrencies on various tacker by 2030, or your head may asplode!