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In a recent Reuters story http://www.reuters.com/article/us-usa-banks-conference-jpmorgan/jpmorgans-dimon-says-bitcoin-is-a-fraud-idUSKCN1BN2KP, JPMorgan's Jamie Dimon threw a bomb at the emerging cryptocurrency.
In the story he states, "The currency isn't going to work. You can't have a business where people can invent a currency out of thin air and think that people who are buying it are really smart."
He goes on to compare Bitcoin to the 17th-century Dutch tulip bulb situation.
Is he right, or is he just shilling for the present system of imaginary-value fiat currencies?
[Separately, according to Bloomberg, Bitcoin has been on a five-day decline: Bitcoin Crashes After Chinese Exchange Says It Will Halt Trading. --Ed.].
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JPMorgan's Jamie Dimon Says Cryptocurrency a Fraud, Bound to Fail
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When I met th'POPE back in '58, I scrubbed him with a MILD SOAP or
DETERGENT for 15 minutes. He seemed to enjoy it ...
(Score: 3, Insightful) by Grishnakh on Friday September 15 2017, @02:03PM
Where does its ability to purchase goods and services come from?
From the same place any other currency's ability to purchase goods and services comes from: people agree the currency holds value, and are willing to trade based on that perception of value. It's a lot easier to trade currency than to barter with other things (e.g., I want to buy the piece of furniture you're selling on Craigslist, and I think it's worth 35% of the refrigerator I'm selling. How do I give you 35% of my refrigerator for it, and what if you don't want my fridge anyway?).
The big difference is that normal currencies are backed by nation-states, while cryptocurrencies are backed by nothing more than a bunch of computer geeks agreeing it has value, plus the fact that generating the currency requires significant computation (which prevents you from just "printing" it willy-nilly like nation-states can with their currencies). So if people decide BitCoin is worthless, its value plummets, though this is also true of regular currency. But regular currency has a nation-state and its whole economy backing its claim to value, and is managed by that nation-state's central bank, so the nation-state has every incentive to maintain its currency's value (it may devalue it some to pay back debt easier, but it won't go too far because then they won't be able to trade effectively).