Bitcoin Is Monopoly Money, Will Get Annihilated
Jim Cramer, the outspoken host of ‘Mad Money,’ has called Bitcoin ‘Monopoly Money,’ and has suggested that the futures market will ‘annihilate’ the cryptocurrency’s value when they open. The comment came during a segment aired on CNBC.
Cramer is no fan of Bitcoin, in spite of, at one point, mentioning that the price could go to $1 mln. He believes the current run up is a bubble that has been driven to new highs by traders in order to short the value once the futures market opens. According to the famous investor:
“I think the short selling is just going to annihilate people when you can start trading it. Once this thing starts trading the futures, they are just going to kibosh it.You’re going to see a lot of shenanigans.”
While Cramer has expressed the concerns of many on Wall Street, others, including industry insiders, disagree. The general feeling among Bitcoin-aware investors regarding the run up is that, while there are potential dangers in every market, the market will continue to maintain stability, even as the futures market begins to take hold.
For example, Barry Hayut, chairman and CEO of Hayver Corporation says:
“Unlike Monopoly money, there are many real services and products that can be purchased with Bitcoin today. Money is a store of value. Every day there are tens of thousands of people around the world that see this value in Bitcoin and exchange it with volumes recently exceeding 15 bln dollars a day. That is more than Apple, Google and Microsoft average daily trading a day combined.”
Additionally, while the comparisons with other bubbles (the tulip bubble of Dutch fame, or the land bubble in the mid 19th century) the underlying Blockchain technology provides a basis for value in the Bitcoin ecosystem that is maintained by the consensus of the majority.
Instead, the utility of the system, along with the disconnectedness of Bitcoin produces the fear among bankers and traditional investors. Itay Shechter, Founder of Vanywhere said:
“The value of Bitcoin is derived from social contracts and the millions of users involved. The Blockchain revolution takes the power and control back to the community. Banks and regulators are not used to something that is completely out of their hands, so they attack. The volatility of Bitcoin reflects the ‘hype,’ FOMO and other factors in society. Bitcoin might have gone up too fast too soon recently, but Jim completely ignores the utility and technology behind it.”