Hey what’s up guys, Shang here. So I know this may be a controversial topic as some of you may have invested money in cryptocurrency. But I have decided to make the video anyways to share why I will never put money into cryptocurrency. I hope you guys will enjoy this video.
I have attached this video’s script below:
The problem with bitcoin is that it is very difficult to determine what it is worth. Bitcoin does not generate a cashflow, it does not have an industrial use like gold or silver, nor does it provide investors with any way of measuring what it is worth apart from the fact that there are only ever going to be 21 million bitcoins available. Therefore, one should only invest in bitcoin if you are prepared to lose a lot of money because se you have no way of knowing whether it will go up or down and when it will do so
Bitcoin is not widely used as a currency. And reason why it is not widely used as a currency is because it does not have value except the price assigned to it by the market.
“If you buy something like Bitcoin, you don’t have anything that is producing anything. You are just hoping the next guy pays more. And you only feel you will find the next guy to pay more if he thinks he is going to find someone that is going to pay more. You are not investing when you do that. You’re speculating.”
You see, the more I think about his argument, the truer it becomes. When you invest in a business, that business creates a product or service the can be traded and consumed. But what can you really do with a bitcoin other than selling it to another person?
Buffet also made the point that hypothetically, if every government banned the trading of stocks, your stocks would still have a value because the business is still producing a product or service that can be sold. However if you were to ban crypto trading platforms, then crypto currency would be worthless as they cannot be sold nor are they useful for any industrial purposes.
Now do not get me wrong, even though I am not a fan of bitcoin, or any other type of cryptocurrency, I am interested in the underlying blockchain technology. For those of you who are unfamiliar with the concept of blockchain technology, to put it simply, it’s a record-keeping technology that is heavily used in the banking, healthcare, supply chain industries. It can also be used for voting.
There’s a difference between buying a digital coin and investing in blockchain technology. When a investor buys a digital coin, they have ownership of the coin but not the blockchain technology. Bitcoin and any other cryptocurrencies depend on blockchain technology but blockchain technology does not depend on the digital coin. Therefore, If I were interested in blockchain, I would invest in companies such as IBM who are developing the technology.
Business Enquires: [email protected]
