The Future of Bitcoin: 'Myth' or 'Joke'?
In the past few years, the Bitcoin market has swung successively. But it kept growing from $0 in 2009 to the highest price it ever had, $68,000 in December 2021. Bitcoin has gone through much fiercer ups and downs lately. Bitcoin’s price exceeded $64,000 in the first half of 2021 but dropped sharply over the summer, below $3,000. And it finally climbed back to over $68,000 in November. Although Bitcoin has experienced plenty of fluctuations, it cannot be seen clearly where is the future of Bitcoin, a myth or merely a ridiculous joke?
Warren Buffett had given his views about Bitcoin, “Whether it goes up or down in the next year, or five or 10 years, I don't know. But the one thing I'm pretty sure of is that it doesn't produce anything”.
What's more, Bitcoin has been described as an economic bubble by at least eight Nobel Memorial Prize in Economic Sciences. Journalists, economists, investors, and the central bank of Estonia have voiced concerns that Bitcoin is a Ponzi scheme.
The market has made a true response to these concerns over Bitcoin. According to the data of CouponBirds, the sales of Bitcoin-related merchants have seriously decreased.
As shown in the graph, the sales of Bitcoin-related merchants had kept a low volume in the past year. Sales in Q1 2022 dropped by 77% on a season-on-season basis, the lowest sales in the past year. Sales in Q2 and Q3 in 2021 not only maintain a reducing trend, but both of them are less than half of sales in Q1. Sales in Q4 2021 have bounced back, a little over 50% but are still nearly one-fourth less than Q1 2021 sales.
CouponBirds' data roughly support a gloomy market expectation for Bitcoin. But it cannot prove whether Bitcoin is a myth or a joke? As a common investor, what we should keep in mind is that Bitcoin is an asset filled with uncertainties and high risks, and it is not suitable for us to bet on Bitcoin's future, even when its price soars and its value is flattered by many media outlets.
References
1. DeMatteo, Megan, "Bitcoin Price History: 2009 to 2022".
2. Macheel, Tanaya, "Warren Buffett gives his most expansive explanation for why he doesn't believe in bitcoin".
3. Wikipedia, "Ponzi scheme".
