As Bitcoin pushes north of $11,000, bubble talk continues to pervade.
Yesterday, I urged you to treat such chatter as noise.
Today, let’s get specific.
The loudest Bitcoin detraction I’m hearing is quite clever, actually…
It’s the idea that Bitcoin is a pyramid scheme.
“If I buy Bitcoin today, it will be more valuable tomorrow because others have bought it at a higher price. As an existing ‘investor,’ I am benefitting from others getting in. Don’t get me wrong, Bitcoin is valuable, but it’s not worth $10,000 per coin, or even $1,000 per coin. It’s a currency. It’s not Amazon (NASDAQ:AMZN) or Apple (NASDAQ:AAPL) stock.” — Hackernoon
Allow me to applaud the author here.
If you believe that shares of fantastic companies have more intrinsic value than Bitcoin, well… then calling Bitcoin a “pyramid scheme” is fun.
But I don’t agree.
Buying Bitcoin means buying into the ideas that governments shouldn’t enjoy monopolies on currencies… that anonymity within the financial system is increasingly important… that security (the blockchain) is virtually priceless… that geographic borders don’t matter much.
For those reasons (and more), I’m happy to pay a fat premium.
Heck, I’ll even pay a higher premium than I would for Apple or Amazon.
And given that I’m an Amazon permabull, that’s really saying something!
Nonetheless, I’m a firm believer in hearing both sides of an argument.
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