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Black swan

Bitcoin’s Decline Signals An Impending Collapse, Says ‘Black Swan’ Author

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Nassim Nicholas Taleb, the­ influential author of “Black Swan,” has issued a cautionary stateme­nt regarding Bitcoin’s recent de­cline. According to him, this cryptocurrency’s downfall indicates an immine­nt collapse. He views cryptocurre­ncy as an open Ponzi scheme sustained by market manipulation.

Taleb took to Twitter to share his views on BTC performance­ and highlighted a significant drop of over 85% in its trading volume from its pe­ak, indicating a loss of interest and liquidity. He warns of easier manipulations with dwindling volume, though manipulators will eventually exit.

Taleb has also accuse­d Bitcoin supporters of exhibiting cult-like be­havior and irrationality. He argues that they te­nd to disregard the flaws and limitations of Bitcoin, resorting inste­ad to personal attacks when faced with criticism.

In a bold stateme­nt, Taleb remarked, “This is how Ope­n Ponzis implode.” Notably, his observations align with rece­nt data from Coinbase. The­ platform’s Q2 earnings report for 2023 reve­aled a drastic decrease­ of consumer and institutional trading volumes by 70% compared to the­ previous year.

The­ industry now faces additional challenges such as an ongoing “crypto winte­r” and numerous lawsuits filed by the Se­curities and Exchange Commission (SEC). These­ factors further compound the existing difficultie­s faced by the platform.

Bitcoin’s Price Lacks Volatility And Momentum

The appre­hension toward Bitcoin grows due to its current stability, or rathe­r the lack of volatility, in its price. A market analysis firm calle­d Glassnode has highlighted the ongoing “e­xtreme volatility compression” within the­ market, suggesting more predictable price movements and potential decline in demand and supply.

Additionally, as of August 11th, Bitcoin’s price re­mains below the crucial $30,000 mark—a significant support barrier in the­ past. A breach of this level could impose­ further downside pressure­ on Bitcoin and lead to testing new lows.

Blackfridge­’s CEO, Mike Crosbie, warns that BTC precariously hove­rs just below this critical threshold. While the­re is still a possibility of an upward break at this leve­l, each passing day diminishes that chance.

It is important to note­ Taleb’s skepticism towards cryptocurrencie­s considering his role as a longtime critic. In June­, he humorously compared Bitcoin to the mafia by claiming that unlike­ it, which tends to deliver on its promise­ for protection.

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Black Swan’s Nassim Taleb Slams Crypto Fans As DimWits

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The well-known mathematician Nassim Taleb recently expressed his disapproval of the bitcoin sector on Twitter. Crypto enthusiasts were mocked by Taleb as “miswired technoheads” and “dimwits.”

He said that although he initially had great expectations for cryptocurrency, as he learned more about blockchain, he grew more and more disillusioned.

Taleb said, in what appeared to be a criticism of the bitcoin industry’s false promises,

“I have never been blinded by hope,”

Asiff Hirji, a former executive at Coinbase, echoed this sentiment when he bemoaned the abundance of frauds and schemes in the industry. Hirji, however, thinks that blockchain may significantly enhance and streamline financial activities.

For a long time, Nassim Taleb has been a harsh critic of Bitcoin, repeatedly labeling the leading cryptocurrency a worthless speculative bubble. He described it as “a magnet for imbeciles” in July. In a paper titled “Bitcoin, Currencies, and Bubbles,” released in June 2021, Taleb offered his pessimistic argument for the largest cryptocurrency in June. The former options trader claimed that Bitcoin had failed as a currency and an inflation hedge after earlier praising it for not being governed by any government.

Nassim Taleb Defines BTC As A “Tumor”

Taleb stated earlier this year that prolonged periods of low-interest rates were to blame for the formation of bubbles like those in the Bitcoin market. Nassim Nicholas Taleb, a Lebanese-American statistician, and risk analyst referred to Bitcoin as a “disease” in a recent interview with CNBC.

Nassim Taleb asserts that the U.S. Federal Reserve’s extraordinarily accommodating monetary policy, which he compares to Disneyland, is the reason why the largest cryptocurrency was able to spread.

The age of low-interest rates was prosperous for the first cryptocurrency. In order to boost the economy in the wake of the global financial crisis, former Fed Chairman Ben Bernanke cut interest rates almost to zero just before it was launched.

The Lebanese-American academic claims that while bitcoin is currently going through a crisis, the real cause is a lack of money moving through the system. According to him, it doesn’t matter what the market price is as long as the company can turn a profit.

Despite all the excitement, cryptocurrency hasn’t been able to produce anything “remotely practical” that can generate cash flow.

The revenue is circular, with some suckers in the midst, claims Nassim Taleb. Some skeptics believe that bitcoin is solely sustained by a speculative activity because Bitcoin doesn’t generate earnings or cash flows for its buyers.

Here’s Why Cryptocurrency Is In Crisis According To “Black Swan” Author

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Cryptocurrency has gone from being the hottest new thing to experiencing a complete catastrophe. Whether their bitcoin, dogecoin, and other tokens are safe should be the first thing crypto owners should be asking themselves right now. If you hold them with the incorrect broker or custodian, they could disappear into a protracted bankruptcy procedure and possibly never reappear.

Author of “Black Swan,” Nassim Nicholas Taleb, refuted the notion that the cryptocurrency market is experiencing a liquidity crisis in a recent Twitter discussion.

The Lebanese-American scholar contends that while cryptocurrency is currently experiencing a crisis, it is actually because of a shortage of financial flow. He contends that as long as the business can make money, the market price is unimportant.

Cryptocurrency hasn’t succeeded in creating something “remotely usable” in order to generate cash flow, despite all the hype.

According to Taleb, the revenue is circular with some suckers in the middle. Because Bitcoin doesn’t produce earnings or cash flows for its buyers, some skeptics think that cryptocurrency is only supported by speculative activity.

Bill Gates’s Opinion On Cryptocurrency

Bill Gates, a co-founder of Microsoft, recently asserted that non-fungible tokens are an investment that falls victim to the “greater fool argument.”

Gates said that those who spent a lot of money on monkey artwork would be able to change the world for the better.

The latest market correction has caused the NFT bubble to inevitably bust, with the floor price for a Bored Ape Yacht Club lately falling to its lowest level since last August. Within just two months, entry costs have dropped by approximately 80%, leaving investors who paid considerably more to purchase the hot NFT stocks in the dust.

The value of other well-known NFT collections, such as e CryptoPunks, has also fallen.

Even while NFTs have had a lot of celebrity endorsements, some well-known figures decided to reject them at the height of their appeal. For instance, Canadian actor Keanu Reeves thought it was absurd to spend a lot of money on pieces of art that could be readily copied.

Given that Gates has long criticized cryptocurrencies, his pessimism shouldn’t come as a surprise. The billionaire allegedly stated in May 2018 that he would be open to short Bitcoin. Given that he lamented cryptocurrencies’ lack of intrinsic worth in a Reddit post, it appears that Gates hasn’t warmed up to them.

Despite being a bear, Gates insists he hasn’t shorted Bitcoin.