This is a guest post by Bob Keith, chronic crypto nut and freelance writer/editor
There is no consensus on Bitcoin’s next move or underlying value. After rising from the USD 7,000 level a few weeks ago, the world’s most popular crypto briefly spiked over $9,000.
Beleaguered crypto buyers could be heartened by this price action. Many may be staring at huge losses on positions that were opened up at last year’s heights. Speculators that entered the space last year when crypto prices were in the middle of a moonshot have seen the enthusiasm evaporate as 2018 unfolds.
Within the tech community, there are vast differences of opinion over the future of Bitcoin. Bill Harris, who helped found PayPal, delivered strong criticism of the entire crypto space in a recent blog post.
First published at recode, Mr. Harris’ scathing words shed light on what he views as the worst aspects of popular cryptos.
After calling Bitcoin a “scam,” Mr. Harris goes on to detail his reasons for warning anyone away from what he sees as an asset wholly devoid of value.
Instead of seeing Bitcoin as an investment, the tech and finance insider sees Bitcoin as one of the largest pump-and-dump schemes in history. The term ‘pump-and-dump’ is usually used in markets where a security is promoted by insiders, so they can drive the price up and sell their assets to gullible investors.
Since Bitcoin’s most recent rally from USD 7,000, there have been some very large sales of the crypto. MarketWatch reported on April 18th that two “whales,” or large holders of a crypto, unloaded more than USD 100 million worth of Bitcoin in less than 24 hours.
The reasons for the sales are unknown. Some feel that the sales pushed the value of Bitcoin down by more than USD 200 in minutes. The sales also demonstrate the lack of liquidity in the crypto marketplace at times.
Tim Draper is another tech visionary who backed successful startups like Tesla Inc., Hotmail, and Skype. Over the next four years, Mr. Draper thinks that Bitcoin will rise to the USD 250,000 level and overtake fiat currency.
He used an Intelligence Squared U.S. debate to expand on his view that Bitcoin will be “bigger than the internet,” and that in a few year’s time, people who still use government-issued currencies would invite public ridicule.
Opposite him at the debate was Financial Times Managing Editor Gillian Tett, who voiced similar concerns to Bill Harris. Chief among them is that Bitcoin is widely used by criminals, and this is a massive problem for governments and law enforcement.
Interestingly, Mr. Draper acquired his collection of around 30,000 bitcoins at an auction by the U.S. Marshals in 2014. He affirmed that he is still in possession of these Bitcoins, which would be worth more than USD 250 million at present market prices.