Bitcoin is up dramatically since the coronavirus pandemic took the wind out of its sails. The Federal Reserve Bank of New York and billionaire investor Jim Rogers don’t seem to care however. Both are slamming Bitcoin with the bank’s representatives claiming there is “nothing new” about Bitcoin. As usual, more and more sceptics continue to reign on digital gold’s parade even as the long-term prospects of the project continue to see the price rising and more and more retail and institutional investors beginning to take it seriously.
That said, as is always the case in the world of digital currency, there is always room for a dose of skepticism. Rogers as being particularly vocal about the prospect of Bitcoin eventually going to zero. He believes that government regulation and the power of military forces is actually what will bring Bitcoin to its knees. Rogers was recently quoted by a Japanese newspaper saying that “…The government has access to something Bitcoin doesn’t… guns.”
Can Military Force Lead to Bitcoin’s Downfall?
Of all banking CEOs, hedge fund managers and billionaire investors, Rogers’ perspective on Bitcoin is perhaps one of the most skeptical in comparison to everyone else. He believes that government military forces across the world are a big reason citizens respect government backed currencies. He believes that if Bitcoin ever becomes a legitimate form of currency, governments would simply wipe it out, make it illegal, and perhaps even threaten violence if citizens were to try and continue to use it.
For many crypto enthusiasts, Rogers’ beliefs are clearly flawed. The blockchain is a decentralized technology that allows digital currencies to flow across borders. Nobody owns it and nobody controls it is what the purists would say. But does Rogers have a point?
Bitcoin gamblers here at BTCGG clearly know the answer to that. It’s no. Rogers says that governments can just make the use of Bitcoin centralized. While governments can certainly control its use on centralized websites or servers, the blockchain itself cannot be attacked or hacked.
Federal Reserve Bank of New York Agrees….Somewhat
Michael Lee and Antione Martin are two seasoned authors working for the Federal Reserve Bank of New York. They both claim that Bitcoin is essentially a form of fiat currency without “legal tender status”. It’s a funny observation considering the state of New York is very much aware of an implied need to regulate cryptocurrency thanks to its BitLicense initiative for businesses.
While on the one hand Lee and Martin say Bitcoin is not a legitimate form of currency, on the other they admit that the concept of a decentralized currency is a new thing that has value.
As usual, Bitcoin’s detractors continue to come out of the woodwork. Don’t be too hard on Rogers and the Federal Reserve Bank of New York though. There are several other big names in the investing world that don’t believe in Bitcoin.
Warren Buffet, arguably the world’s most famous and successful investor, to this day holds the belief that Bitcoin has no fundamental or intrinsic value. United States President Donald Trump also doesn’t believe in Bitcoin.
Other notable wealthy investors also agree with Buffet and Trump, including Robert Schiller, Joseph Stiglitz and Paul Krugman.
What Will It Take for Other Naysayers to Come Around?
The reality is most naysayers don’t really care of Bitcoin becomes something that everyone uses on a day-to-day basis. While purists hope that happens, those that think Bitcoin only has value because people agree on it assume that the price will eventually somehow get to zero are close to that. The only antidote to these negative opinions as to see the price go the other way of course. Perhaps if the Bitcoin price gets to $100,000 or $1 million, more and more investors will become converts and recognize that as the value gets further away from zero, the chances of a complete collapse becomes simply impossible.