Bitcoin: Money Or Not?

I first heard about Bitcoin in 2012 as a sophomore in college. At this point, I am not sure from which source this mystery first revealed itself. However, I have had many run-ins with Bitcoin ever since.

When I learned about Bitcoins existence the price was south of $100. But during my year studying abroad in China, Bitcoin made some major moves and began rising over $100 per coin, this got a lot of people interested in the new found digital money. In fact, I even did an economics project in China about how Bitcoin could be used as a currency in the future( nobody believed me). While living in China I considered buying Bitcoin, but I was living off of small amounts of scholarships, grants, and student loans, and the cautious part of me could not justify spending borrowed money on something I hardly understood. Making an economics presentation is one thing, understanding the subject is another :).

Fast forward to my return to America and my final year at University. I had been reading, and studying on finance, and seriously considered buying Bitcoin with the little bit of money I had. I was so interested that I downloaded a Bitcoin wallet and looked up how to purchase some Bitcoin. Unfortunately at the time, it was pretty complicated to buy Bitcoin, and I did not know if I could trust the process so I backed off. Silly me! Had I followed through and bought Bitcoin back then, I would probably have tens of thousands of dollars.

Anyway, ever since the bull market of 2017, I decided Bitcoin would probably be around for a while, and would likely be a good way to diversify some savings. It still took me two years to begin buying Bitcoin, but now I buy small amounts monthly using the Cashapp.

Even with the last bull run of Bitcoin, many people continue to debate the merits of buying this mysterious digital money – especially Peter Schiff and Anthony Pompliano. Peter Schiff is an entrepreneur, investor, and a bit of market contrarian, who heavily advocates buying gold and other precious metals. Anthony Pompliano is a co-founder of a company, and strong Bitcoin advocate.

Schiff and Pompliano had a fantastic YouTube discussion about the merits of Bitcoin. Schiff believes Bitcoin will eventually be wiped out and has no value. Pompliano however, believes Bitcoin will go way up in value, and possibly be used widely as money.

One of my biggest take-aways from the discussion was whether or not Bitcoin can actually be used as money. Peter Schiff made a great point which has changed my perspective on Bitcoin. Schiff stated that while gold and other physical commodities have inherent value outside of trading( manufacturing, art, etc..), Bitcoin, like paper fiat currencies, have no value outside of being a medium of exchange. Therefore Bitcoin appears to be digital fiat currency! Though there remains a critical difference between Bitcoin and our modern notions of fiat currency.

Bitcoin, unlike US Dollars, cannot be printed to infinity. There is a finite amount of Bitcoin that can ever be created, therefore it is scarce. Additionally, it is decentralized so no single entity controls the currency. Then there is the fact that Bitcoin cannot be confiscated easily, especially if it’s stored securely, because no one knows the password except the owner (theoretically). So even though Bitcoin has no physical value outside of trade, I believe the other positive attributes will probably mean it sticks around for a while, and I believe it will continue to be used.

The debate between Peter Schiff and Anthony Pompliano can be found here . It was a fantastic discuss and I learned a lot, it is a must for people trying to learn the pros and cons of owning Bitcoin.

What do you think, do you own any Bitcoin?

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