We all know somebody who has been sucked into the black hole known as Bitcoin. We all know them. They are the ones ranting and raving on social media about how great of an investor they are. They are usually computer nerds who have never invested in anything other than their gaming system. Now if you can’t tell I’m a little upset at the whole situation. At first, I was impressed. Now I’m mortified. Here’s the thing bitcoin has risen in value a ridiculous amount. At the time I wrote this article the price was at $15,830. Now I agree that Bitcoin is a cool new concept. But it’s just that a concept. It’s not practical. But yet millions of Americans are getting rich of a currency that they can’t see, can’t touch, Is not backed by anything, and cannot be used to even buy anything. Heck a Chuck E. Cheese token is worth more than bitcoin.
So why is Bitcoin so expensive? The simple answer if the value of something is not always was it actually is but what it is perceived to be. For example, a house that only costs $200,000 can sell for twice as much. Why? Because people may perceive the value as that much because it’s a good neighborhood. Or the house was previously owned by a celebrity. This can add more value. The same goes for Baseball cards. The card itself only costs a couple cents but its value can be so much more. Depending on if it’s signed, the edition of the card, and who’s on the card. The same goes for Bitcoin. It’s pretty much worthless but everyone perceives it as priceless. The old saying goes the price will always rise if you find someone stupid enough to pay for it.
So why are all these billionaires raving about how good it is? Well, they’ve seen this play done many times and they’re in on the scheme. It’s called the Pump n’ Dump. A little phrase that means everybody raves about how good this useless investment is, which raises the price so more people buy into the scam, then quickly sells off when the price is high known as dumping. And when this happens everyone is left high and dry.
Now if you know whats going on you can be a part of the pump and dump and make money along with the people running the play. Just know when to pull out. People are saying bitcoin will rise to $1 million. Yeah right! it’ll crash way before then. Especially considering bitcoin will be traded on the stock exchanges this coming year in 2018. When the big boys get in the game the value will come crashing down. And there will be many who will make money when it all comes crashing down.
So don’t lose your money in the scam. Be smart and scheme and you could make money on the collapse. Don’t be caught holding the bag when everyone dumps.
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