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June 23, 2018 - Health Ranger - Mike Adams

18:19

Bitcoin MANIA: Rising prices convince many that Bitcoin can never crash

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	I've got a Bitcoin update for you.
	Thank you for listening.
	Mike Adams here, the Health Ranger, the publisher of BitRaped.com and BitcoinCrash.News as well.
	Now, Bitcoin has surged through the equivalent of $6,600 in value per Bitcoin, and it continues to go up.
	And what's interesting about this is that The rise of the bubble has now convinced all Bitcoin cultists that they are right.
	Now, this is the same logic that we saw in the dot-com bubble of the 1990s, which of course ended catastrophically in about 2000 roughly, with many dot-com stocks losing over 99% of their value.
	But during the dot-com rise, there was a mania.
	And the mania was, of course, self-inflicting through circular logic.
	People who said that dot-com stocks were going to go up forever were then reinforced by the fact that the stocks kept going up, apparently, forever.
	And so they would project the future based on the recent present, which is a huge mistake for any investor to do because the future is...
	Impossible to see and always very different from the present.
	There are surprises in stock markets, right?
	There are surprises in history, in geopolitics.
	There are disasters and wars and collapses throughout history.
	In fact, most currencies that have ever existed have collapsed.
	Very few currencies are alive today compared to the number of currencies that have been created.
	And cryptocurrency is a very new phenomenon.
	So cryptocurrency hasn't been tested much at all.
	And what's fascinating to me is how people who are promoting Bitcoin and saying it's going to go up forever...
	Say the logic they use is faulty.
	They claim that it's scarce when it isn't scarce because anybody can create their own cryptocurrency overnight and there are over a thousand cryptocurrencies that have been created.
	They say that it's private and untraceable.
	That's not true at all.
	There are tools that can trace every transaction of Bitcoin.
	Besides, it's a public ledger.
	There's no privacy in the Bitcoin ledger.
	Every transaction can be seen publicly.
	So anyone's activities in Bitcoin can be traced.
	It's not that difficult, especially if you bought Bitcoin through a credit card initially.
	That gets that transaction tied to your wallet, then all the activities of your wallet can easily be traced.
	And there are people now who are even being arrested in the United States for buying and selling Bitcoin.
	And they're being arrested under some regulation that requires people to register under some...
	What is it?
	Like some banking act of some kind.
	I don't know.
	It's some...
	Crazy regulation that shouldn't apply, as far as I'm concerned, to people who are buying and selling Bitcoin.
	But, of course, the Feds are trying to kill Bitcoin because they can't control it, and so they are now arresting these people.
	But getting back to the main point here, the problem with Bitcoin is that it is a digital fiat currency.
	It's backed by nothing.
	It's backed by nothing.
	And the mining that's required to keep Bitcoin going right now is consuming a massive amount of power.
	Massive amount.
	Enough power to power an entire city of almost a million people.
	And this amount of electricity consumption is not sustainable.
	It cannot continue to keep growing because at some point you're going to run out of electricity on the planet.
	I mean, it's already taking a huge amount of electricity, again, as much as a major city.
	Well, as the Bitcoin promoters say, today less than 1% of the population is even using Bitcoin.
	So if it grows by 100 times, that would mean that the mining behind it would have to increase to the electricity consumption of 100 cities of a million people.
	Now you're starting to consume a very large portion of the electricity available on the entire planet.
	And for those people who are concerned with global warming, Most of this electricity is coal-powered electricity.
	A lot of it's in China.
	Some of it's in Russia.
	Some of it's in the U.S. and so on.
	But a lot of it, the vast majority, is powered by coal.
	So you're burning coal to power Bitcoin, which is insane.
	The inefficiency of electricity usage is off the charts.
	It doesn't require nearly that amount of electricity to run, let's say, the Visa credit card network or even a bank.
	So the mining aspect of it means mathematically it is unsustainable on its current projection course.
	But that doesn't stop people from thinking it's going to go up forever.
	Now, I have said from day one, when I started becoming critical of Bitcoin, remember, if you go back through my history with Bitcoin, I was a big promoter of Bitcoin and cryptocurrency for many years.
	And I ran a small solar-powered Bitcoin mining farm in Arizona, and I actually converted sunlight into Bitcoins using mining hardware, and I collected some Bitcoins that way because we had some excess wattage due to solarizing one of our offices.
	So we had some Bitcoin, and when the recent bubble started taking off, I sold Bitcoin, virtually all my Bitcoin holdings at about $2,500 and began warning people that this was a bubble.
	But at that time, I also said, look, it could go much higher.
	It could go to $10,000.
	I even said it could go to $100,000.
	I'm on the record saying that through multiple podcasts.
	And I even explained why.
	Because In every mania, in every bubble, prices are not set by fundamentals.
	Prices are set by psychology and faith.
	And because you can't anticipate human psychology, there's no way to really be able to predict human mental behavior.
	So you can't call the top of this market.
	There's no way to call the top.
	I can't call the top.
	You can't call the top.
	Nobody can.
	This could go much, much higher.
	But we know it's going to crash at some point.
	Crash big time.
	Why?
	Well, for all the reasons that I've discussed here over and over again.
	Number one, it's backed by nothing.
	You can't trade Bitcoin for gold inside a Bitcoin company.
	In other words, it doesn't have an inherent exchange value that's backed up by a company or a government or even a central bank.
	Bitcoin is literally backed by nothing.
	It's created out of nothing, just thin air.
	And thus, it can crater overnight and there's no company to sue.
	There's no way to claim your Bitcoins.
	There's no automatic exchange.
	You have to convince someone to buy your Bitcoins, frankly, to be able to exchange it or barter it for something else.
	I mean, right now, yeah, you can sell Bitcoins for dollars or sell Bitcoins for gold, but that's only because there's a willing party on the other side who wants your Bitcoins more than they want their gold or dollars or whatever they're trading for you.
	But if Bitcoin starts to crater and people are running away from Bitcoin, there's no automatic mechanism by which you can turn in Bitcoin and get something in exchange.
	In other words, there's no gold standard for Bitcoin.
	Secondly, as we found out with Puerto Rico, when the infrastructure goes down, as it will do in a natural disaster, in a nuclear war, in a solar flare, an EMP attack, or numerous other scenarios, when the grid goes down, the value of Bitcoin is exactly zero.
	No one can argue with that, although people try, but they just make themselves look like fools and morons, frankly.
	Look, Bitcoin is entirely dependent on the electrical grid and the internet working and people having computers or mobile devices that work.
	And if you don't have those things, Bitcoin is worth nothing.
	And so as long as you believe that forever and ever and ever that the power grid is going to work great and there's never going to be a solar flare and there's never going to be a nuclear war, even though North Korea is threatening to nuke America, and all these other risks, cyber attacks on the power grid, for and all these other risks, cyber attacks on the power grid, If you don't understand that those things can take down Bitcoin, then you don't understand how cryptocurrency works.
	And then you've got the issue.
	I like to quote Steve Quayle on this, who says, if you can't touch it, you don't own it.
	And he's right.
	And he's right.
	And this applies not just to Bitcoin, but also to money in bank accounts.
	People who have money in bank accounts also have their money in an electronic form that is not reliable.
	And those bank accounts can vanish overnight in a systemic banking failure, as has happened over and over again throughout human history.
	So smart people are taking money out of the bank I mean, not all the money, of course, but money that you want to put away into a safe asset.
	And they're trading that money for things like land, farmland in particular, and farmland with water sources even better.
	And just by purchasing ranches and so on.
	By doing so, they are trading something that is not real, i.e.
	electronic money in a bank, for something that is physically real and tangible, i.e.
	a piece of land that has inherent value for the simple reason that we are physical beings.
	We all have bodies.
	We all have a need for food.
	We all have a need for physical space and so on.
	Thus, physical land will always have value, no matter how far you go into this realm of Virtual worlds and electronics and software and internet connectivity.
	You still have a physical body.
	You still need food.
	You still need water.
	You still need physical space.
	And thus, those physical things have inherent, tangible, irrefutable value.
	And if the electricity crashes, your land doesn't disappear, right?
	But if the electricity goes down, the power grid fails, your Bitcoin vanishes.
	Instantly, you have no Bitcoin.
	That doesn't happen with land or cattle, for that matter, or ammunition or firearms or tractors or all these other things that have real inherent value.
	You know, a 500-gallon tank of diesel fuel on your farm has inherent value.
	So, all of these people who are putting their faith in Bitcoin are investing in a simulation.
	It is a virtual, online, shared spreadsheet, a ledger that they are buying into.
	They're buying a line on a ledger.
	That doesn't have any inherent value.
	It is an abstract system.
	It's all abstract, all the way through.
	And what's really hilarious to me, and actually kind of a little bit sad, is how so many of the Bitcoin people who tend to be libertarians, with whom I agree on most issues, by the way, I consider myself in many ways a libertarian type of person, which is why I support the overall concept of cryptocurrency, by the way.
	And I'm an advocate of other cryptocurrencies like Zcash.
	I'm just, you know, Bitcoin's in the big bubble right now.
	But I'm pro-cryptocurrency.
	Don't have any mistakes about that.
	But what really...
	What I find interesting about this is how many of these pro-Bitcoin libertarians, on the very same day, they will argue against the dollar by saying things like, oh look, the dollar, it's a fiat currency.
	It's backed by nothing.
	You know, it can vanish overnight.
	It can become worthless.
	And then they'll say, buy Bitcoin instead!
	And it's like they don't even see.
	Wait a second.
	Bitcoin is a digital fiat currency.
	Bitcoin is created from nothing.
	Bitcoin is backed by nothing.
	Not even backed by a government.
	Not even backed by taxpayers.
	You know, the US dollar, as lousy as it is, as much as it's lost over 99% of its value since 1913, at least it is still backed by the ability of the United States government to put a gun to the head of every taxpayer and confiscate their wealth.
	That's sort of some of the backing of the dollar.
	Which is, government coercion, yeah, it's bad.
	But that's how government can, you know, take over.
	Or at least sort of back their currency by force and coercion if they have to.
	If Bitcoin goes down, you know, thankfully, there's no Bitcoin goons that come to your door, put a gun to your head and start extracting wealth from your pockets in order to prop up Bitcoin, which is a good thing.
	We don't want that to ever happen.
	But that also means that Bitcoin isn't backed by anything other than faith.
	And faith is fickle.
	It's a psychological currency, if you think about it.
	It's just backed by psychology.
	It's backed by people's belief systems and belief systems can change overnight.
	For example, let me just give you a simple mathematical irrefutable example.
	You understand that cryptocurrencies use encryption, right?
	I hope.
	That's where the term cryptocurrency comes from.
	So did you know that if you had a magical box, let's say, that could break all encryption, that you could steal everybody's bitcoins, right?
	Do you understand that that's the case?
	That's the structure of bitcoin.
	If If somebody can crack all encryption, they can steal all your Bitcoins.
	Well, how do you crack encryption?
	You do it through quantum computing.
	You build a quantum computer, you know, a multiple qubit system, and then you can crack encryption.
	Now, nobody's done it yet in terms of, let's say, a 256-qubit quantum computing system.
	But they're getting close.
	And guess who's leading the way on quantum computing in the world today?
	It's not America.
	No, it's not the NIST, as you might think.
	It is China.
	And China is not only ahead of the game, they're right now building a $10 billion research center to focus on quantum computing research because they understand that whoever cracks this first, whoever builds the first...
	Let's say 256-bit quantum computing system will dominate the world.
	They will dominate everything because they will be able to crack every 256-bit encrypted message.
	Which is the underlying system behind the military, behind banking transactions, behind government secrecy, everything.
	Remember that movie Sneakers with Redford?
	And Dan Aykroyd was, I think, in the movie as well.
	Sneakers.
	It was from a few years back in the 1990s, I believe.
	Watch that movie because that movie covered the fictional construct of somebody who had created a box that could break all encryption.
	And that movie is actually becoming true.
	And so if you can break all encryption, then cryptocurrency becomes meaningless.
	There's no cryptography layer then that can protect the cryptocurrency transactions and ownership of the accounts and so on.
	It just becomes instantly hackable.
	And a lot of people don't even think about that.
	They think, oh, this must be good forever.
	No, it's not good forever.
	Things can change.
	And the real challenges to cryptocurrency might come from vectors that you don't even think about.
	It's not just the 51% attacks.
	It's not just somebody taking over all the mining and then changing the ledger.
	It can also be these other things like someone breaking all cryptography.
	Which would be a game changer.
	What about artificial intelligence?
	It's also well known that the first country that comes up with an AI system that is sufficiently intelligent could probably take over the world.
	And so AI research is happening right now.
	And AI might also pose a threat to human-owned cryptocurrencies in ways that we can't even anticipate because, of course, we are limited to human intelligence.
	So there are all kinds of angles to this that no one is thinking about.
	Whereas gold, gold is ultra-reliable.
	Gold is simply gold.
	Gold is a physical element.
	Gold cannot be destroyed or created through software.
	You can't destroy it.
	You can't create it.
	You can't get rid of it.
	Gold is an element.
	You can't even destroy it through anything less than nuclear processes.
	So that's the truth about what has value and what doesn't have value.
	Read my website, bitraped.com, to learn more.
	Thank you for listening.
	If you want to support our mission, visit us at healthrangersstore.com for the world's largest selection of lab-verified superfood and nutritional products for healthy living.

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