During the COVID-19 Shelter In Place directive, I took the advice of a friend and started (binge) watching a show called The Black List. In Episode 5 of Season 3, Bitcoin was used as payment on the Dark Web. This would have been edgy in 2014 when the episode was shot, and even in 2015 when it was broadcast. What caught my attention was the USD equivalent for the Bitcoin. The offer was “2,800BTC or $700,000 USD”!
I double-checked and indeed the scriptwriters had their facts correct. In 2014 and 2015, a Bitcoin was a few hundred dollars. This was when Mt.Gox was hacked and shut down, diminishing confidence in Bitcoin.
Today the price of a Bitcoin bounces between USD $6000 – $10,000. Although this price is less than half of its peak in December 2017 where it hit $20,000 USD. Anyone who bought Bitcoin between December 2017 and January 2018 but didn’t sell immediately would have lost money – some lost a lot of money. But thinking back to that The Black List episode, if that Dark Web payment of $700,000 USD in 2015 was accepted in the form of Bitcoin, its value would be $18,000,000 USD today.
Indeed the episode is fictitious, but the math is real. It provides comforting context that Bitcoin does hold its value given a sufficient timeline. Transacting with terrorists is not in my plans, but I do intend to hang onto my digital currency to see where it is in 5 years, maybe while binge watching another show, hopefully not during another pandemic lock down.
The highly respected weekly financial newspaper Barron’s published a great article “Bitcoin Storms Wall Street” by Avi Salzman on Dec 2, 2017.
This exhaustive, analytical, and well researched article quotes hedge fund managers, derivatives experts, Goldman Sachs analysts and appears to paraphrase one of my blog posts.
The 39th paragraph of this Barron’s article discusses the risks of trading cash-settled Bitcoin futures and uses the SAME ANALOGY I USED COMPARING BITCOIN TO FRIENDSTER! I would like to point out I published my blog post on November 28 (5 days BEFORE the Barron’s article published).
Here’s what I published on Nov 28, 2017: “Bitcoin may have been the first, but it may not be the long term winner. Do you wish you invested in Facebook? Its IPO was around $32 and today it’s $180. You could have quintupled your money. But before Facebook was MySpace. And before MySpace was Friendster. Friendster was first – do you remember Friendster? Exactly. If you put your money on Friendster, you would have lost. Maybe Bitcoin is Friendster or MySpace. Maybe an altcoin will be the next gold standard and Bitcoin will be the next generation’s punchline.”
Here’s what Barrons published Dec 2, 2017: “A danger is that Bitcoin could end up being the Friendster of the crypto world, while the Facebook – the real winner – may still be in development somewhere.”
Does Avi Salzman read my blog? I am flattered (but a credit or even a heads up would have been nice). If anyone finds other articles that closely resemble what I wrote, please let me know, I find these things gratifying.