[Cryptography] Cryptocurrency: CME Approved, Coin Paychecks, FED, OpenBazaar ZEC BCH

[Ray Dillinger]

I am concerned.

A lot of money is going into Bitcoin.  This is harmless - even good for
the crypto market, as long as the investors are solvent.

But the current crop aren't. A lot of that money is borrowed. They're
borrowing money to get in.  They're trading futures.  They're buying
bitcoin on their credit cards and paying 20% interest.  They're
mortgaging their houses.  And now banks are borrowing to hold bitcoin in
their portfolios....

A lot of the institutions holding that bitcoin for their customers don't
have anything like the amount of USD on hand that they'd need to cash
the customers out in case something happened that shook their confidence
even a little bit and, say, 10% of them wanted out.

In order to lay hands on that amount of USD, of course they'd have to
sell Bitcoin.

Bitcoin is thinly traded.

A large sell-off in a thinly traded asset would cause a market shock.

The customers would get less money than expected for their coin due to
the market shock.

The market shock, and the cries of anguish from customers who feel that
they were "cheated", might prompt more customers to want to sell.

 Bitcoin was a reaction (If I understand Satoshi's intent correctly) to
the 2008 debt market crash, intended to be something where debt wasn't
possible.

But when people are in debt to own something and want to sell the thing
to pay off their debts and the people holding it for them are in debt
and would have to sell it to get the money to pay them, and the people
they'd have to sell it to are banks who have leveraged positions that,
in a falling market, would want to sell it themselves.....  It's
starting to sound a lot like those funny mortgages people were writing
in 2007.

				Bear





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