Still thinking about “Crypto-Currency”

In theory, ONE company would create this currency and hold a limit on how much they created to avoid hyper-inflation. Now The Japanese, (who proved their banking system is worse than ours,) are welcoming cryptocurrency. The Chinese are banning it. The Indians are afraid of it. There are a great many companies making cryptocurrencies with no license and nothing to stop them from producing all they think they can earn.
I’m seeing more stupid fat guys with loud voices and dumb fake smiles telling everyone they have a handle on everything. Meantime they put themselves and everyone else into bankruptcy.

 
 

A  collective insanity has sprouted around the new field of ‘cryptocurrencies’,…

causing a totally irrational worldwide gold rush. It has reached the point that a big percentage of stories in the financial news and questions in Mr. Money Mustache’s email inbox are about whether or not we should all ‘invest’ in BitCoin.
We’ll start with the answer: No, you should not invest in Bitcoin. The reason is that it’s not an investment. Just like gold, tulip bulbs, Beanie Babies, 1999 dotcoms without any hope of a product plan, “pre-construction pricing” Toronto condominiums you have no intent to occupy or rent out, and rare baseball cards are not investments.
These are all things that people have bought in the past, and driven to completely irrational prices, not because they did anything useful or produced any money and value to society, but solely because they thought they would be able to sell them to someone else for more in the future.
When you make this kind of purchase, which you should never do, you are speculating, which is not a useful activity. You’re playing a psychological, win-lose battle against other humans with money as the only objective. Even if you win some money through dumb luck, you have lost some time and life energy, which means you have lost.
Noticed this ad on the corner of a website recently … because we ALL need daily updates on an obscure piece of niche software technology!
Investing means buying an asset that actually creates products and services and cashflow for an extended period of time. Like a piece of a profitable business or a rentable piece of real estate. An investment is something that has intrinsic value – that is, it would be worth owning from a financial perspective, even if you could never sell it.
Jan 2, 2018448 comments
Why Bitcoin is Stupid
Well, shit. I’ve been watching this situation for a few years, and assuming it would just blow over so we wouldn’t have to talk about it here in this place where we are supposed to be busy improving our lives.
But a collective insanity has sprouted around the new field of ‘cryptocurrencies’, causing a totally irrational worldwide gold rush. It has reached the point that a big percentage of stories in the financial news and questions in Mr. Money Mustache’s email inbox are about whether or not we should all ‘invest’ in BitCoin.
We’ll start with the answer: No, you should not invest in Bitcoin. The reason is that it’s not an investment. Just like gold, tulip bulbs, Beanie Babies, 1999 dotcoms without any hope of a product plan, “pre-construction pricing” Toronto condominiums you have no intent to occupy or rent out, and rare baseball cards are not investments.
These are all things that people have bought in the past, and driven to completely irrational prices, not because they did anything useful or produced any money and value to society, but solely because they thought they would be able to sell them to someone else for more in the future.
When you make this kind of purchase, which you should never do, you are speculating, which is not a useful activity. You’re playing a psychological, win-lose battle against other humans with money as the only objective. Even if you win some money through dumb luck, you have lost some time and life energy, which means you have lost.
Noticed this ad on the corner of a website recently … because we ALL need daily updates on an obscure piece of niche software technology!
Investing means buying an asset that actually creates products and services and cashflow for an extended period of time. Like a piece of a profitable business or a rentable piece of real estate. An investment is something that has intrinsic value – that is, it would be worth owning from a financial perspective, even if you could never sell it.
Now, with that moral sermon out of the way, we might as well talk about why Bitcoin has become such a big thing, so we can separate the usefulness of the underlying technology called “Blockchain”, from the mania about how people have turned Bitcoin it into a big dumb lottery.
This separation is important because the usefulness of Blockchain is the primary justification people use for the big dumb Bitcoin lottery. 
Once you make this separation in your mind, you can see that Blockchain is a simply a nifty new software invention (which is open-source and free for anyone to use), whereas Bitcoin is just one well-known way to use it.
Blockchain is just a computer protocol, which allows two people (or machines) to do transactions even if they don’t trust each other or the network between them. It can have applications in the monetary system, contracts, and even as a component in higher level protocols like sharing files. But it’s not some spectacular Instant Trillionaire piece of magic.
As a real world comparison, I quote this nifty piece from a reader named The Unassuming Banker:
… imagine that someone had found a cure for cancer and posted the step-by-step instructions on how to make it on-line, freely available for anyone to use.
Now imagine that the same person also created a product called Cancer-Pill using their own instructions, trade marked it, and started selling it to the highest bidders.
I think we can all agree a cure for cancer is immensely valuable to society (blockchain may or may not be, we still have to see), however, how much is a Cancer-Pill worth?
 
Our Banker friend goes on to explain that the first Cancer-Pill might initially see some great sales. Prices would rise, especially if the supply of these pills was limited (just as an artificial supply limit is built right into the Bitcoin algorithm.)
But since the formula is open and free, other companies would quickly come out with their own cancer pills. Cancer-Away, CancerBgone, CancEthereum, and any other number of competitors would spring up. Anybody can make a pill, and it costs only a few cents per dose.
And yet imagine everybody started bidding up Cancer-Pills, to the point that they cost $17,000 each and fluctuate widely in price, seemingly for no reason. Because of this, newspapers start reporting on prices daily, triggering so many tales of instant riches that you notice even your barber and your massage therapist are offering tips on how to invest in this new “asset class”.
But instead of seeing how ridiculous this is, even more people start piling in and bidding up every new variety of pills (cryptocurrency), over and over and on and on, until they are some of the most “valuable” things on the planet.
NO, right?
And yet this is exactly what’s happening with Bitcoin. And if you haven’t been digging into the cryptocurrency world much, it gets way weirder than this. Take a look at this shot from the website coinmarketcap.com, and observe the preposterous herd behavior in real life:
Fig.1: Various cryptocurrencies, ranked by how many people have been fooled.
“Holy Shit!” is the only reasonable reaction. You’ve got Bitcoin with a market value of $234 Billion Dollars, then Ripple at $92 billion with Ethereum right behind at $85,792,800,592.
These are preposterous numbers. The imaginary value of these valueless bits of computer data represents enough money to change the course of the entire human race, for example eliminating all poverty or replacing the entire world’s 800 gigawatts of coal power plants with solar generation. Why? WHY???
An Aside: Why should we listen to you, Mustache?
I’m only a mediocre computer scientist. But coincidentally, after I got my computer engineering degree I ended up specializing in security and encryption technologies for most of my career. So I did learn a bit about locking and unlocking information, hacking, and ensuring that independent brains (whether they are two adjacent CPUs on a circuit board or two companies negotiating across the Pacific) can trust each other and coordinate their actions in lockstep. I even read about these things for fun, with Simon Singh’s The Code Book and the Neil Stephenson novel Cryptonomicon being particularly fun shortcuts to pick up some of the workings and the context of cryptography.
But that’s just the software side (Blockchain). Bitcoin (aka CancerPills) has become an investment bubble, with the complementary forces of Human herd behavior, greed, fear of missing out, and a lack of understanding of past financial bubbles amplifying it.
Mustachianism – the mental training that gets you to very early financial freedom – requires you to evaluate inefficiencies in our culture and call bullshit upon them. Even if you are the only one in the room willing to do it.
In the field of personal wealth, this means walking your children past the idling lineup of your neighbors’ Mercedes SUVs, over the snowy grass and up to the door of the school – and being confident that you are doing the right thing. Even if you’re the only one doing it.
When evaluating investment bubbles, it means looking at where everyone is throwing their money – no matter how many billions – and being willing to say “Bull. Shit. Guys. Not going to do this with you.”
So I also read a lot about investment bubbles and fundamentals and how to tell those apart. One book that I found very useful in understanding the greed-fear cycle (and Central Banking and the Federal Reserve system to boot) is the 2001 classic Towards Rational Exuberance by Mark Smith. For a shortcut to understanding good investing, you can also simply look up Warren Buffet’s thinking on almost any topic – he’s careful enough about offering opinions that by the time he makes a statement on something, you can be pretty sure it will be among the best answers out there.
And of course, the purpose of this whole aside is that I want to establish credibility with you, so you will give this article some consideration. I believe the current Cryptocurrency “investment” mania is a huge waste of human energy, and our rate of waste has been growing exponentially.
The sooner we debunk the myth and come to our senses, the richer our world will be. So we need more credible people to speak out against it. If you’re one of these credible people, please do so in the comments or in a blog post on Medium that we can all read.
Why was Bitcoin Even Invented?
Understanding the motivation is a big part of understanding Bitcoin. As the legend goes, an anonymous developer published this whitepaper in 2008 under the fake name Satoshi Nakamoto. It’s well written and pretty obviously by a real software and math person. But it also has some ideology built in – the assumption that giving national governments the ability to monitor flows of money in the financial system and use it as a form of law enforcement is wrong.
This financial libertarian streak is at the core of Bitcoin, and you’ll hear echoes of that sentiment in all the pro-crypto blogs and podcasts. The sensible-sounding ones will say, “Sure the G20 nations all have stable financial systems, but Bitcoin is a lifesaver in places like Venezuela where the government can vaporize your wealth when you sleep.”
The harder-core pundits say “Even the US Federal Reserve is a bunch ‘a’ CROOKS, stealing your money via INFLATION, and that nasty Fiat Currency they issue is nothing but TOILET PAPER!!”
It’s all the same stuff that people say about Gold, which is also a totally irrational waste of human investment energy.
Government-issued currencies have value because they represent human trust and cooperation. There is no wealth and no trade without these two things, so you might as well go all-in and trust people. There are no financial instruments that will protect you from a world where we no longer trust each other.
So, Bitcoin is a protocol invented to solve a money problem that simply does not exist in the rich countries, which is where most of the money is. Sure, an anonymous way to exchange money and escape the eyes of a corrupt government is a good thing for human rights. But at least 98% of MMM readers do not live in countries where this is an issue.
So just relax, lean into it, and grow rich with me.
OK, But What if Bitcoin Becomes the World Currency?
The other argument for Bitcoin’s “value” is that there will only ever be 21 million of them, and they will eventually replace all other world currencies, or at least become the “new gold”, so the fundamental value is either the entire world’s GDP or at least the total value of all gold, divided by 21 million.
People then go on to say, “If there’s even a ONE PERCENT CHANCE that this happens, Bitcoins are severely undervalued and they should really be worth, like, at least a quadrillion dollars each!!”
This is not going to happen. After all, you could make the same argument about Mr. Money Mustache’s fingernail clippings: they may have no intrinsic value, but at least they are in limited supply so let’s use them as the new world currency! 
Why not somebody else’s fingernail clippings? Why not one of the other 1500 cryptocurrencies? Shut up, just send me $100 via PayPal and I’ll send you a bag of my fingernail clippings.
Let’s get this straight: in order for Bitcoin to be a real currency, it needs several things:

• easy and frictionless trading between people 
• to be widely accepted as legal tender for all debts, public and private
• a stable value that does not fluctuate (otherwise it’s impossible to set prices)

Bitcoin has none of these things, and even safely storing it is difficult (see Mt. Gox, Bitfinex, and the various wallets and exchanges that have been hacked)
The second point is also critical: Bitcoin is only valuable if it truly becomes a critical world currency. In other words, if you truly need it to buy stuff, and thus you need to buy coins from some other person in order to conduct important bits of world commerce that you can’t do any other way. Right now, the only people driving up the price are other speculators. The bitcoin price isn’t rising because people are buying the coins to conduct real business. It’s rising because people are buying it up, hoping someone else will buy it at an even higher price later. It’s only valuable when you cash it out to a real currency again, like the US dollar, and use it to buy something useful like a nice house or a business. When the supply of foolish speculators dries up, the value evaporates – often very quickly.
Also, a currency should not be artificially sparse. It needs to expand with the supply of goods and services in the world, otherwise we end up with deflation and hoarding. It also helps to have wise, centralized humans (the Federal Reserve system and other central banks) guiding the system. In a world of human trust, putting the wisest and most respected people in a position of Adult Supervision is a useful tactic.
Finally, nothing becomes a good investment just because “it’s been going up in price lately.”
If you disagree with me on that point, the price of my fingernails has just increased by 70,000% and they are now $70,000 per bag. Quick, get me that money on PayPal before you miss out on any more of this incredible “performance!”
Figure 2: Random people on Twitter doing some deep, useful Investment Analysis on Bitcoin.
The world’s governments are not going to let everyone start trading money anonymously and evading taxes using Bitcoin. If cryptocurrency does take off, it will be in a government-backed form, like a new “Fedcoin” or “G20coin.” Full anonymity and government evasion will not be one of its features.
And you don’t want it for this purpose anyway – after all, do you currently hide your money in offshore tax havens and transact your business on black markets? Do you practice illegal tax evasion as your primary wealth strategy? Probably not, because life is better and wealthier when you aren’t living a life of crime.
The Cryptocurrency bubble is really a replay of the past: A good percentage of Humans are prone to mass delusions which lead to irrational behavior. This is a known bug in our operating system, and we have designed some parts of our society to protect us against it.
These days, stocks are regulated by the SEC, precisely because in the olden days, there were many, many stocks issued that were much like Bitcoin. Marketed to unsophisticated investors as a get-rich-quick scheme. The very definition of an unsophisticated investor is “Being more willing to buy something, the more its price goes up.”
Don’t be one of these fools.
Further Notes
About the Comments Section: Normally, I try not to publish comments that are just emotional reactions or totally uninformed. For this article, I have set the bar much lower to show you the religious conviction that crypto speculators have.
People are genuinely mad at me for calling out this speculative aspect (note that I did not criticize blockchain at all, just the idea of uninformed people betting on future price increases for the arbitrary “coins”).
The general trend seems to be accusing me of “not doing enough research”, even after I dug into this stuff pretty deeply for a long, long time. I remain open to more information on the uses of Blockchain, but I’ve never seen a valid fundamental reason for betting on future increases in the prices of these things.
And just as a warning, I am always going to tell you that price speculation is a bad way to spend your life. This part of it is ideological to me: You Must Earn Your Money By Creating Value for Everyone.
Here’s a great description of the whole scene by Chain CEO Adam Ludwin. You’ll note that without prejudice and emotion, he describes the actual uses of the technology, without getting into how we should all place uninformed bets on its future value. 
The real test of if you should be a cryptocurrency supporter: would you be exactly as passionate and spend the same amount of time thinking about it, if Bitcoin were still an obscure piece of code, worth less than one cent, and offered no chance of ever earning you any money? Because if you’re going to be an evangelist for anything, it needs to be purely based on the underlying merits, not what you hope it will do for your personal fortune.
This YouTube Video is one of the best shortcuts I found for explaining how Blockchain (and Bitcoin) works.
This Vice article explains yet another ridiculous aspect of Cryptocurrency: running the transaction network (called “Mining”) involves a deliberate computer-intensive crypto challenge syetem called “proof of work”. This inefficient design is now wasting more electricity than many entire countries. Doing one transaction burns 215 kilowatt-hours of electricity, enough to run the entire MMM household for more than a full month, or to power an electric car for more than 800 miles of driving.
Another interesting side-effect of bitcoin mining: big sales of computer graphics cards, and theft of electricity and cloud computer services. One of my coworkers at MMM-HQ works for nVidia, and part of his job is hunting down mining thieves who comandeer virtual servers (cloud computing) to mine coins on their behalf. Some of my conversations with him inspired the research in this article.
I enjoyed this analysis by Aswath Damodaran, a thoughtful investor and Professor at NYU school of business
Another intelligent case by highly experienced crypto business lawyer Preston Byrne. Favorite quote:
“Bitcoin’s growth is not based on its technology alone (which, while powerful, is open-source and therefore easily replicable) but rather on the strength of virality, encouraged by the vested interests who held early and invested in marketing it; with no genuine business underlying it, it acquires its (very substantial) memetic potency only from the evangelism of those who hodl and preach.”
David Webb’s great explanation: Bitcoin: the World’s First Decentralized Ponzi Scheme
Preston Byrne again (brilliant guy!): the Problem with calling Bitcoin a Ponzi Scheme
As the Bitcoin revolution continues to spread throughout the world, there are still some places where buying or using Bitcoin is illegal and can get you in trouble.
BITCOIN STILL ILLEGAL IN SOME COUNTRIES
As Bitcoin’s popularity continues to grow throughout the world, some governments are beginning to realize its benefits and potential and are integrating Bitcoin and cryptocurrencies in their economy, rather than trying to punish those that use it with restrictive policies and exaggerated taxes.
Japan, for example, has recently passed a law that makes Bitcoin a legal form of online payment, removing taxes and setting up a regulatory framework for Bitcoin-based businesses. Australia has also taken a stance in favor of cryptocurrencies and removed the double-tax that was penalizing average Bitcoin users.
However, not all countries are as forward thinking especially when it comes to cryptocurrencies. Believe it or not, Bitcoin is still illegal in some countries, which says a lot about Bitcoin as a disruptive technology.
To be clear though, the world’s first decentralized cryptocurrency is not illegal because it poses any risk to the citizens of the countries we will list. Rather, it provides an alternative, open, P2P monetary system — and an exit for some  — which is seen as a threat to their centrally-controlled, legacy monetary system.
All of the countries listed below banned Bitcoin in 2014, following the Mt. Gox disaster. As Bitcoin begins to gain traction throughout the world, it’s possible that these countries may eventually change their stance on Bitcoin and digital currencies.
VIETNAM
Although Bitcoin can be freely used by citizens, the State Bank of Vietnam issued a statement in February 2014 warning against the use of Bitcoin and prohibiting credit institutions to deal with the cryptocurrency.
The statement reads:
All bitcoin exchanges that allow users to trade anonymously, therefore, can be used to launder dirty money, sell drugs, hide from paying taxes, exchange and pay for illegal activities.
In December 2016, the government of Vietnam stated that it will consolidate cryptocurrency regulations as its current provisions “fall short.”
ICELAND
Bitcoin’s legality in Iceland is not very clear. According to a statement issued in March 2014 by the Central Bank of Iceland, dealing with Bitcoin may violate the Icelandic Foreign Exchange Act, which specifies that Icelandic currency cannot leave the country and that foreign currency cannot be used in the country.
Bitcoin mining is legal in the country and so is transacting with Bitcoin, but apparently if those Bitcoins cannot be purchased from a foreign exchange or have to be mined in Iceland. This leaves a lot of room for questions. The statement reads:
There is no authorization to purchase foreign currency from financial institutions in Iceland or to transfer foreign currency across borders on the basis of transactions with virtual currency. For this reason alone, transactions with virtual currency are subject to restrictions in Iceland.
BOLIVIA
In May 2014, the country’s central bank, El Banco Central de Bolivia, officially banned any and all currencies not issued and/or regulated by the government, specifying Bitcoin, a few other altcoins and any other currencies that do not belong to a state or economic zone.
The statement reads:
It is illegal to use any kind of currency that is not issued and controlled by a government or an authorized entity.
ECUADOR
Ecuador not only banned Bitcoin and all other cryptocurrencies, but it did so while establishing guidelines for the creation of their own virtual currency.
The National Assembly of Ecuador passed a bill that amends the country’s monetary laws in July 2014, banning cryptocurrencies and allowing the government to issue and transact in its asset-backed “electronic money.”
KYRGYZSTAN
In Kyrgyzstan, using Bitcoin as a form of payment is illegal, although no law prohibits users from buying, selling and using. In August 2014, the National Bank of the Kyrgyz Republic, issued a statement in which it noted that the use of Bitcoin and other cryptos as a form of payment is illegal given that the only legal tender in the country is the country’s Kyrgystani Som (KGS).
The statement reads:
Under the legislation of the Kyrgyz Republic, the sole legal tender on the territory of our country is the national currency of Kyrgyzstan som. The use of ‘virtual currency’, bitcoins, in particular, as a means of payment in the Kyrgyz Republic, will be a violation of the law of our state.
BANGLADESH
Bitcoin is not legal in Bangladesh. Transacting with any type of decentralized cryptocurrency can get you up to 12 years in jail and it has been so for almost three years.
In September 2014, the Bangladesh Bank issued a statement regarding the use of Bitcoin and warning that it is punishable by law. Bank officials said that anyone found guilty of dealing with Bitcoin or any other cryptocurrency could be jailed for up to 12 years under current anti-money laundering laws. The central bank went as far as to request citizens not to “spread information about it.”
The statement reads:
Bitcoin is not a legal tender of any country. Any transaction through bitcoin or any other cryptocurrency is a punishable offense.
Do you believe these countries will change their stance on Bitcoin and build a regulatory framework around it? Let us know in the comments.
(SN) I’m not a math genius nor a computer technician of any sort. However, I can think through a problem analytically and come to some conclusion that may be useful. The author said there is an artificial limit placed by Bitcoin on how much currency they’ll “produce.” But they cannot control all the other companies producing cryptocurrencies too! The affect would be like producing counterfeit $20 bills by the millions. It turns into hyperinflation and finally a collapse of the entire faith, trust in, and use of this type of currency.
Nations that have had terrible experiences with collapsing currencies have banned these currencies and I think their caution is well founded. My advice is to avoid everything related to cryptocurrencies. Invest in something real, something people will always want and need.
https://www.cnbc.com/2017/12/22/bitcoin-china-singapore-japan-issue-cryptocurrency-warnings.html

From China to Singapore, Asian countries are increasingly uneasy with the rise of bitcoin

• Regulators in Asia Pacific, including those in China, Australia and Singapore have become increasingly uneasy with the rise of cryptocurrencies
• Japan, South Korea and Vietnam together accounted for 80 percent of bitcoin trading activity at the end of November, the Wall Street Journal reported
• Bitcoin has surged this year, prompting worries of a bubble that could threaten financial stability in the region

Yen Nee Lee
Published 12:56 AM ET Fri, 22 Dec 2017
 

cryptocurrencies such as bitcoin.

The latest to sound a warning was the Bank of Japan Governor Haruhiko Kuroda, who called the surge in bitcoin prices “abnormal” at a media conference on Thursday. His comments echoed warnings made by his counterparts in major economies in the region, including Australia, South Korea and Singapore.
Their worries are not unfounded as Asia accounts for the bulk of trading in bitcoin, the largest cryptocurrency by value.
At the end of November, Japan, South Korea and Vietnam contributed 80 percent of bitcoin trading activity globally, the Wall Street Journal reported, citing data from research firm CryptoCompare.
Getty Images
Sharp volatility in the price of cryptocurrencies is a particular area of concern for regulators.
Bitcoin’s price has risen by more than 1,500 percent this year. Prices have declined from their peak, and there are fears that a deeper plunge may reverberate around financial markets.
Despite that, the race to introduce financial products linked to cryptocurrencies has intensified with the likes of Goldman Sachsplanning to set up a digital currency trading desk, and CME Group and CBOE launching bitcoin futures contracts. 
In contrast, Asia Pacific economies have been less welcoming of cryptocurrencies, with many authorities issuing some of the strongest warnings. CNBC provides an overview of what some regulators have said:

China — Wants full control

China was quick to clamp down on cryptocurrencies, with authorities banning bitcoin trading and initial coin offerings (ICO) in September. Its central bank, the People’s Bank of China, said the unregulated market could pose major financial risks to the world’s second-largest economy.
Despite the country’s tough stance on privately-issued, decentralized virtual currencies, Beijing is actually in favor of the use of digital currencies. The PBOC said it was looking into issuing China’s own sovereign digital currency and has set up a team to develop one.
Thank empty Chinese cities for bitcoin’s rise  7:09 PM ET Tue, 23 May 2017 | 01:41
 

Japan — First-mover in legalizing bitcoin

Japanese lawmakers in April allowed the use of bitcoin and several other cryptocurrencies to make payments and in September officially recognized 11 cryptocurrency exchange operators. The country, however, has no plans yet to issue its own digital currency.
Recently, the Bank of Japan joined the chorus of warnings about the rapid rise in the price of bitcoin. Governor Kuroda said Thursday the price increase was “abnormal” and bitcoin is “being traded for investment or speculative purposes,” not functioning as a means of payment or settlement.

India — Worries about illegal usage

The Reserve Bank of India has repeatedly warned of the risks in trading virtual currencies. Regulators are also worried that cryptocurrencies may be used by people to evade tax, launder money or finance terrorism.
Last week, authorities widened their probe into possible wrongdoings linked to cryptocurrencies.

South Korea —  Monitoring financial institutions

South Korea has banned its financial institutions from dealing in virtual currencies, including buying, possessing or holding them as collateral. ICOs will also be outlawed, the Prime Minister’s Office said in a statement earlier this month.
The country accounts for some 20 percent of bitcoin trading worldwide, AFP reported.
About one million South Koreans, many of them small-time investors, are estimated to own bitcoin.

Australia — Bitcoin is a “speculative mania”

Reserve Bank of Australia’s governor Philip Lowe called the fascination with virtual currencies a “speculative mania” and added that bitcoin is more likely to be attractive to those transacting in the illegal economy, than consumers.
The central bank chief also talked down the possibility of issuing a digital form of the local currency in the near term.
Need to think of economic consequences when bitcoin bubble bursts: UBS  3:45 AM ET Tue, 12 Dec 2017 | 02:31
 

New Zealand — Bitcoin is “classic case” of a bubble

Grant Spencer, acting governor of the Reserve Bank of New Zealand, said the price movements in bitcoin are very volatile and a “classic case” of a bubble.
He said cryptocurrencies may have a part to play in the future, but not in the form of bitcoin. The central bank is looking into demand for the New Zealand dollar and assessing whether to replace it with a digital alternative at some stage.

Southeast Asia — Reeling from the 1997 crisis

Southeast Asia was the region most affected by the 1997 Asian financial crisis, and authorities there have issued some of the strongest warnings about the potential downsides of cryptocurrencies.
Indonesia, the region’s largest economy, has plans to ban cryptocurrency transactions starting from 2018 in a bid to protect its local currency, rupiah, the Jakarta Post reported. Its smaller peer, Vietnam, will also ban payments using cryptocurrencies next year.
Singapore, a major global financial center, said in a notice earlier this week that investors “run the risk of losing all their capital” given the speculative nature of cryptocurrency investment. The city-state’s sentiment was shared by Thailand, where the local stock exchange said there’s a risk of bubble forming in the digital currency space.
http://www.scmp.com/news/china/economy/article/2122691/beijings-bitcoin-ban-helped-china-dodge-scary-cryptocurrency

Beijing’s bitcoin ban ‘helped China dodge a scary cryptocurrency bubble’

PUBLISHED : Sunday, 03 December, 2017, 9:44pm
UPDATED : Monday, 04 December, 2017, 10:52am
If I haven’t completely lost you by now, this is my final wisecrack. Avoid Cryptocurrencies like the Bubonic Plague! 

If you are so wealthy that you can afford to trade and lose $50,000/day and laugh about it — my advice would be — open more small businesses. Open more little cafes, more optician shops, finance a doctor’s new clinic, finance 20 of them. Make your money work in something you can guide and control. This fake money stuff is absolute insanity.  sn

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