In the past months, many friends and clients asked me about my opinion about the Bitcoin. Even my mom did, although she wasn´t able to pronounce its name correctly. It is in a regional newspaper, general TV news, radio, facebook. Everybody´s hype about the cryptocurrency today.
I am in the markets since 1997, with the direct experience of trading and investing many styles. Equities, ETF´s, futures, indexes, options. US and world. And from day trading to investing, value, momentum and growth shares, calendar spreads for futures, statistical arbitrage, options strategies, and many others. And of course, the Automated Systems, as the best of the best for me.
If I wonder where is the momentum of Bitcoin, I see the hyped hype emotions like rarely before, as there is lack of fundamentals.
To be fair, there is one fundamental. It is the freedom of the transactions, worldwide. The anonymity. The own independence on the official currencies and their banks, fees and the Tax Office. The immediate transactions.
Sounds good, logical, right? But, there is the deadly misleading of the assumption. If there is such a level of anonymity, hidden transactions, and high level of protection for buyer and seller, there will follow the organized crime, money laundering, drug dealers, terrorism… It is for sure, I am 100% sure. More bright the Bitcoin will shine, more sooner the first terrorist action will be revealed as financed by the Bitcoins. And other crime will follow this anonymous financial stream.
The situation with the Bitcoin now reminds me the Happy 60´s and the drugs. All the hippies wanted to Make Love Not War. And look how the happy use of drugs ended. The consequences weren’t clear that time.
Nobody now would vote for a free drugs trade. Naturally, right?
The essence of the Bitcoin is attracting the organized crime and terrorists, right now, highest probably. Unfortunately. They heavily need such a sweet tool. How many good ideas converted into the deadly weapons?
After the first attack financed by the Bitcoin, and other crime supported by the anonymity of Bitcoin will be revealed to the public, the national governments will act in accord. Secret services will require the immediate action. The activists will demonstrate. The superstars will talk to the media and ask the stop.
Country by country will ban the Bitcoin and make it the crime using it. The people, the public opinion will support that ban, united. The elections will be won for the promise to ban the Bitcoin.
The Bitcoin will be banned in most countries and it will crash. Inevitably, that´s how I see it.
The timing? I don´t know. Few years I guess, 2-5, not more than 10 years. Today is December 1st., 2017.
Take the article as my personal opinion. I am not holding or intending to own or trade long/short the Bitcoin or its derivates in the future.