This is not financial advice. Seek the counsel of trusted professionals applicable for your personal goals. Please do your homework.

The word VALUE, it is to be observed, has two different meanings, and sometimes expresses the utility of some particular object, and sometimes the power of purchasing other goods which the possession of that object conveys. The one may be called ‘value in use;’ the other, ‘value in exchange.’ The things which have the greatest value in use have frequently little or no value in exchange; and, on the contrary, those which have the greatest value in exchange have frequently little or no value in use.

Adam Smith, An Inquiry into the Nature and Causes of the Wealth of Nations Chapter IV: Of the Origin and Use of Money

Campbell Harvey, via Linkedin:

We are in another bitcoin bubble. The latest spin: Bitcoin is the “new” gold.

We are in another bitcoin bubble. The latest spin: Bitcoin is the “new” gold. The value of all the world’s gold is $9 trillion. Potential bitcoin supply equals 21 million, meaning 1 bitcoin should be worth $400,000.

Nonsense. First, gold has fundamental value with 70% used in jewelry and some in technology. Bitcoin is purely digital. Second, bitcoin is impractical for transactions & lacks the operationality (loans, derivatives) of Ethereum-based protocols. Bitcoin relies on its “store of value,” but has massive volatility, roughly 4 times the vol of gold or the S&P.

Matt’s note: I have added links for the reader’s reference

I have taught a blockchain course for 7 yrs and have a new book on DeFi ( I believe in the potential of this technology. In Dec 2017 when bitcoin was near $20k, I penned a Washington Post OpEd stating that bitcoin was in a bubble as retail investors rushed to create accounts. Today, the surge is driven by institutional investors trying to “ride the bubble.” BITW is a fund that holds cryptocurrencies. It is trading at a 600% premium to the value of the underlying assets! My warning about bitcoin is similar to my warning about certain growth stocks. Many are buying as prices rise, the so-called ”buy-high” strategy, which usually does not end well. #bitcoin #cryptocurrency #blockchain



Gold, the Golden Constant, COVID-19, ‘Massive Passives’ and Déjà Vu:

Matt’s worthless ramblings on the 6 purposes of any currency:

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