I’m glad that someone else finally chimed in on the bitcoin craze. Shervin Pishevar recently went on a tweet rant that lasted more than 21 hours. He touched on a lot of points, but his tweet about bitcoin has gotten lost. It echoes something I’ve been saying for years.
Proponents of bitcoin like to tout the online currency’s unregulated status. Essentially, bitcoin lovers believe that the online currency is inherently valuable because it is not under the regulatory eyes of any government. Instead, it exists online in something called the blockchain.
The blockchain is simply data that is stored on millions of computers around the world. You probably have some of this data on your computer if you are dabbling in bitcoin. This distribution of data makes bitcoin impossible to hack. It also makes it impossible to control.
Shervin Pishevar does not think bitcoin is completely untethered. In fact, his tweet storm says otherwise. He thinks the online currency will drop rapidly over the next few months alongside the stock market to create another recession. This goes against everything bitcoin proponents love about the online currency.
Shervin Pishevar, like me, knows that bitcoin is tied to the stock market. It has no inherent value. Gold, on the other hand, has tangible value. It’s something you can hold, admire and bury in your backyard in case of a crisis. That’s why gold will skyrocket in value as the economy tanks.
People won’t want to hold their bitcoins when things get bad. In fact, there’s nothing to hold. It’s an abstract idea, and, as Shervin Pishevar says, its value is tied to the stock market. It’s not some independent currency that will sore in value when the times get tough.
I’m just glad that Shervin Pishevar is back. He’s disappeared for a while due to some personal issues, but he’s one of the great market minds of today. His tweet storm marks the return of an investment giant. He was smart enough to invest in Uber early, and he set up his own investment business called Investment company. He certainly knows what he’s talking about.