Well, Well Well. Having read the “Streetwise” column by James Mackintosh in last Friday’s Wall Street Journal, it seems we have yet another “bitcoin bear.” A very, VERY biased bitcoin bear at that. Of course bitcoin bashing is nothing new and has been going on since bitcoin debuted over 15 years ago. But in the WSJ? Oh well. However, reading that the recent plea deal Binance and its CEO Changpeng Zhao (CZ) ‘cut’ with the U.S. Government exposed what crypto really is………was interesting.
Now we at Digital Wealth News strive to keep our individual biases to ourselves and point out BOTH sides of a story. Transparency? Yup. It’s also not our purpose to change James’ (Jim’s? Jimmy’s?) mind on bitcoin (it would be futile anyway), but to point out the negative bias. (Interesting human behavior trait; missing out, or not participating, in a successful market tends to make one more negatively biased, since admitting to being wrong is hard. Like bitcoin, the higher the price goes, the more “haters.”)
The Binance fine of $4.3B and the guilty plea by “CZ” makes great headlines, but it ain’t no big deal and certainly doesn’t make bitcoin an ‘evil’ enemy. Remember JP Morgan Chase has been fined over $39B and BOA (Bank of America) over $87B in the past for a variety of crimes and fraud, including money laundering. Anyone get jailed? Uh, no. Any CEO’s personally fined? Uh, no. If (according to James) crypto was designed for illicit activity, it’s doing a very poor job.
So the “Streetwise” column would have you believe that the two main uses for bitcoin are fraud and crime. WOW! Imagine my surprise that fraud and crime never existed until bitcoin came about. Crazy. Its a very sure bet that money laundering, fraud and all forms of crime have existed for centuries. Don’t blame bitcoin.
“Streetwise” scoffs that bitcoin has ‘punted’ on being a currency and now touts itself as a store of value. Bitcoin is both. Jim (or James) points out that gold, or digital gold, is a much better store of value IF you go back only a couple of years. My first bitcoin purchase was $575 in August 2016. Gold was $1,350. Hmmm. $1,350 to $2,000 (gold) OR $575 to $37,000 (bitcoin). Not to diss Mr. Mackintosh but………well, he has his style.
By the way, I tired using a gold coin for coffee and a scone the other morning. They laughed. They did take bitcoin though as does Starbucks, AMC movie theaters, Microsoft, Tesla, AT&T and a bunch more. Come on James (Jimmy?), get a bitcoin.
Crypto used for gambling? Sure, probably. I don’t gamble so I’m not an expert. But, I was an original member of the CBOE (drats, now you know I’m over 30 and puberty is behind me) when options had a distinct purpose. Now DAILY expiring options?? THAT’S gambling. Hello SEC…….or MGM casinos get on board.
So, just because you don’t understand something (or missed investing) doesn’t mean bitcoin is not viable. Or is bad. Innovation is always misjudged early on. Let’s be fair and keep things in perspective.
Original WSJ Post link here (may require subscription):
Wall Street Journal (11/24/23): “Binance Guilty Please Shows What Crypto Really Is”
https://www.wsj.com/finance/currencies/binance-guilty-plea-shows-what-cryptos-really-about-f84200a3
About The Author: Bill Taylor is the CEO of Digital Wealth News and a 40+ year veteran of the financial markets. You can also ready his weekly musings on BTC, ETH, Gold & SP500 at “The Taylor Market Report“.
