E Bitcoin’s Value: Probably A Lot Higher Than You Think

Bitcoin’s Value: Probably A Lot Higher Than You Think
 

Source: Bitcoin.com

About 8 years ago a Florida programmer by the name of Laszlo Hanyecz developed a late-night craving for some pizza. It just so happened that Laszlo also had a bunch of Bitcoin around, which at that point had no particular value. This is when Laszlo came up with a brilliant idea, he decided to offer to pay 10,000 Bitcoins for two large pizzas. Despite that almost no one at that time knew what a Bitcoin was, his generous offer was accepted.

As Laszlo’s pizza related dreams came true that evening, news about the now infamous pizza purchase began to circulate around the internet, and a valuation for Bitcoin was born. A meager one quarter of just one cent was the original valuation placed on one Bitcoin. However, a few weeks later Bitcoin was officially trading at $0.06, an increase of 2,300% from the time of the pizza purchase. And the rest is history.

Fast forward to today, and Bitcoin’s current price is $12,000, so the Bitcoins that were used pay for the two pizzas are now worth a whopping $120 million today. Yes, Bitcoin has skyrocketed by a mindbending 500,000,000% since the pizza purchase. So, what’s next for Bitcoin? Is the meteoric rise likely to continue? Or is the digital asset’s recent 50% drop a precursor of what’s to come? Did the “Bitcoin Bubble” finally pop?
 

Source: Bitcoincharts.com

Some Bubble Like Characteristics do Exist

Bitcoin buying has been portrayed as somewhat alarming in the media lately, and it is quite possible that many people are engaging in risky behavior to accumulate Bitcoin. There have been a growing number of reports that Bitcoin-buying is entering an irrational phase. In fact, securities regulator Joseph Borg expressed concern citing that an increasing number of individuals in the U.S. are taking out mortgages to invest in Bitcoin. Furthermore, many consumers are using equity lines of credit and credit cards to buy Bitcoin. To compound the issue various exchanges such as Coinbase and others are accepting credit card payments for Bitcoin purchases. This exposes the public to immense risk as people are increasingly using cheap credit to buy Bitcoin.

Bitcoin: The Asian Mania

Perhaps most troubling are the recent reports coming out of Asia. The “Bitcoin Mania” there has reached a fever pitch, and authorities are starting to take notice. Government agencies in China, South Korea, and other nations are starting to shut down exchanges, Bitcoin miners, and are even proposing all out bans on Bitcoin trading. Essentially, these nations are attempting to tear apart the entire Bitcoin infrastructure.

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Eren Solu 1 week ago Member's comment

Bitcoin and Blockchain will be the future of what we call "Money"!!!

BreakingBad News 1 week ago Member's comment

You may very well be right. But I saw that Dr. Duru, said that #bitcoin fell to $6k today and Ernie Varitimos said it could drop to under $3k soon. So that future may be farther away than you think. Hard to believe it was once going for $19k!

David J. Tanner 1 week ago Member's comment

It can still be the future without it be so overvalued. A $19,000 price level is ridiculous to me, just as a $3,000 price level. What currency trades at those kinds of levels? A $1 per bitcoin would make far more sense to me.

Michele Grant 2 weeks ago Member's comment

Richard Shaw was kind enough to share this article with me:

money.cnn.com/.../index.html

Looks like hackers stole $530 million worth of digital currency yesterday. That's even more than the famous $400 million hack of Mt. Gox back in 2014. This is one of the greatest risks of #cryptocurrency and why I enjoy the peace of mind of my FDIC insured #cash.

Duke Peters 3 weeks ago Member's comment

Every time I think bitcoin can't go any higher, it does!

Barry Hochhauser 2 weeks ago Member's comment

I know, there is no end in site.

Michele Grant 3 weeks ago Member's comment

It is unbelievable to me how #Bitcoin keeps going up and up. Don't people realize all the risks involved? This is not a real currency, could easily be hacked, and governments could deem it illegal at any moment. $BITCOMP

Victor Dergunov 2 weeks ago Author's comment

If Bitcoin is not a real currency, then what is? And what make it a real currency and not Bitcoin? Also, bitcoin exchanges can get hacked not the actual Bitcoin blockchain/network. The major governments where the bulk of Bitcoin action occurs, U.S., Japan are going to have difficulty deeming it illegal after legitimizing Bitcoin.

Michele Grant 2 weeks ago Member's comment

Here are some articles which have helped to shape my view on #bitcoin and the #crypcurrency craze:

Why Bitcoin Is Not A Real Currency

by Modest Money

www.talkmarkets.com/.../why-bitcoin-is-not-a-real-currency

When Someone Asks, 'Should I Own Bitcoin?'

By Richard Shaw : www.talkmarkets.com/.../when-someone-asks-should-i-own-bitcoin

Bitcoin Can't Win Against Fiat Currency

By Richard Bookstaber

www.talkmarkets.com/.../bitcoin-cant-win-against-fiat-currency

Also some very good articles by Mish Shedlock and The Heisenberg Report.

Alpha Stockman 2 weeks ago Member's comment

I found this article by James Altucher to be very helpful in explaing Bitcoin:

www.talkmarkets.com/.../everything-you-need-to-know-about-bitcoin

Nathan Feifel has some good stuff too.

Anastasija Janevska 2 weeks ago Member's comment

Thank you for the tip.

Nathan Feifel 2 weeks ago Contributor's comment

Thank you!

Barry Hochhauser 3 weeks ago Member's comment

The question is, did the guy who sold the pizzas for 10,000 #bitcoins, still have those bitcoins? If so, being valued at $120 million now, I bet he's no longer selling pizzas!

Moon Kil Woong 3 weeks ago Contributor's comment

Tearing down the bitcoin structure is not most governments attempt. What they are fighting against is the illicit use of crypto as with other forms of monetary exchange that violate sanctions (S. Korea), cut holes in foreign exchange policies (China), avoid taxes (US and European countries), or support criminal and illegal things. These things have to be addressed. The sooner they are resolved the better for everyone. You can't just shrug your shoulders as N. Korea uses crypto to funnel money to building nuclear weapons and missiles to threaten the US. That is the main why South Korea is desperate to stop the illicit flow until it is fixed along with the suspicion N. Korea is amassing a stockpile to potentially attack their economy if it becomes too big and influential in their economy.

Currency Trader 3 weeks ago Member's comment

Moon Kil Woong, the issues that you stated can not be resolved. The whole purpose of #cryptocurrency is avoid gonverment regution and a paper trail. Without that, all you have is #Paypal or #ApplePay.

Moon Kil Woong 2 weeks ago Contributor's comment

There will be solutions, although a bit artificial, contrived, or enforced. We already see solutions although they are not beautiful and takes away some of the benefits to its freedom.

Terrence Howard 1 week ago Member's comment

Would love to hear your ideas for solutions. And have there been any concrete moves by governments to take any sort of action one way or the other?

Flat Broke 1 week ago Member's comment

I just read in this article here: www.talkmarkets.com/.../heres-why-crypto-is-correcting--and-why-its-temporary

by Adam Sharp, that South Korea has banned annoymous crypto currency trading. Though for the life of me, I don't understand how that would work. Perhaps someone here can explain it to me.

Terrence Howard 1 week ago Member's comment

I'm far from an expert in bitcoin or crypto currencies. Perhaps the author, Victor Dergunov or one of the other experts here knows more

Currency Trader 2 weeks ago Member's comment

Can you give some examples? For the life of me, I can't think of any solutions that would rectify these problems without inherently and fundamentally changing what cryocurrencies are.

Carl Schwartz 2 weeks ago Member's comment

I can't think of a thing either. Solving one problem would only create another. It's really a tradeoff of anonymity vs. control.