May we point, as a quick reminder of how important it is to train – and possibly force – oneself to think logically especially in matters of financial significance, to this find with respect to a gentleman named Joe Rogan, often referred to as the world’s most successful podcaster, or more specifically, to another gentleman “explaining” Bitcoin to said podcaster:
“The difference between Bitcoin and Ethereum is that in Bitcoin there will only be 21 million, it cannot be changed,” Curry explained. “It cannot be inflated, and you cannot say the same for Ethereum.”
We have, thus, an assertion that Bitcoin be scarce and therefore valuable, in the same sentence that acknowledges that, with Ethereum as an example, there are already more than one so-called “cryptocurrencies” in existence, which can quite apparently be created at will, if so desired also with more or less the same characteristics as Bitcoin itself, so that the sentence, when analyzed, destroys the very sense it aims to convey.
The simple syllogism is, of course:
- “Cryptocurrencies” as an “asset class” are not scarce because any sort and number of them can be created by anyone at any time.
- Bitcoin belongs to the “asset class” of “cryptocurrencies”.
- Therefore, Bitcoin is not scarce.
We have discussed this before, but we found it astounding that the world’s most successful podcaster, who should be expected to command significantly above-average intelligence, appears to “swallow” such a self-destructive statement without objection.
We are reminded by the crypto craze of the time-proven wisdom saying “Don’t fight the FED”, yet in the sense that while the FED is certainly a powerful institution, even it can never be as powerful as logic itself, being the core of everything in existence including the FED, which leads to an even more imperative monition to not fight logic hoping even remotely that one may prevail in the long run, as at least in the long run everyone testing his luck will lose this fight without exception.
An in-depth analysis of why “cryptocurrencies” may well be “crypto-” but by no means qualify as currencies in the meaning of money we shall leave to a separate article. A gratifyingly lucid and concise analysis of “cryptocurrency” fallacies by a (shall we say: very) highly prominent (actual) economist, an analysis with an expectably marked econometric leaning, can be found here in the meantime.