Connect with us

Blogs

John McAfee vs. Jamie Dimon: Who’s right about cryptos?

Published

on

McAfee vs Jamie Dimon
READ LATER - DOWNLOAD THIS POST AS PDF

Cryptocoins have been quite controversial since the very beginning, and they remain so. Even as Bitcoin, Ripple, Verge, and Ethereum have soared in value over the last few months (the market is down again for the last couple of days, though), there are still plenty of detractors and skeptics who attack the currencies at every chance.

But there’s the other camp. Some really influential people in the digital world have become champions for cryptocurrencies and the blockchain technology. Most famous among them is probably John McAfee, the eccentric computer programmer, and entrepreneur who founded the first cybersecurity firm and gave the world the first anti-virus program.

The champion: John McAfee

Mr. McAfee has been very optimistic about both the blockchain technology and the cryptocurrencies based on it. In his view, the development of the blockchain is right up there as one of the main events in human history and culture. His words read,

“An event seldom changes our culture in ways that can be clearly seen, measured and felt.

In the past 200 years, there have been two events. The first was The Industrial revolution. The second was the digital revolution. I think that the Blockchain will dwarf both.” While this is a very bold statement, it comes from one of the individuals that have been at the heart of the digital revolution.

Mr. McAfee thinks that the power that the blockchain brings about by decentralizing processes will allow us, humans, to accelerate our evolution. In his words,

“If existing companies transformed to operate on the blockchain, all functions would be distributed. There would be no more bosses, no hierarchical organization, no power of influence greater than anyony [sic] else.”

The blockchain’s potential as a disruptor is huge. It can transform every hierarchical power system into a distributed system. It’s a democratizing force; it changes things from vertical to horizontal through the power of mathematics and cryptography.

It can get us very far indeed if we, as humans, become flexible enough to accept that change and leave behind our traditional power structures in favor of something that’s more efficient, powerful and decentralized.

We will need to learn how to live and work in environments in which central authorities (or authorities of any kind) do not count all that much, but the benefits we could get from that are real, and they’re here already.

This technology is morally neutral, as any piece of knowledge or technology usually is. Mr. McAffee is very clear in stating that it can be used for good or bad. It’s not the tech itself but how you handle it, he uses nuclear energy as an example, it can give you nuclear energy or nuclear bombs.

“The blockchain is a magic wand. What world would you like to see appear before your eyes? Think carefully before you wave it.”

One of Mr. McAffee’s most famous statements concerns Bitcoin’s future value. He’s predicted that every Bitcoin token will reach a value of $1 million by 2020. This has been very controversial, but there actually is a website that’s doing the math behind this prediction and tracking Bitcoin’s progress in order to find out if Mr. McAffee will be right. As of now, it just looks plausible. 

According to Bircoin.top (they have done the math behind Mr. McAffee’s prediction), if Bitcoin grows by 0.48% daily, they will hit the million dollar line by 2020 as per McAfee’s foresight. The thing is, this exactly more or less how Bitcoin has been behaving over the last months, so it’s just possible that McAffee’s prediction will indeed hit the target. Keep an eye on it; it might just become a reality in only eighteen months.

Jaime Dimon: The skeptic

Of course, there’s the opposite camp. The leading voice in opposition to cryptocurrencies (but not the blockchain technology) is JPMorgan’s CEO and chairman, Jamie Dimon. I think he’s wrong, but I will give you his point of view anyway.

Mr. Dimon has been just as vocal as Mr. McAfee about his views on cryptocurrencies (especially Bitcoin) except he is utterly pessimistic and thinks it’s all about the hype, and they will never amount to anything. In fact, Mr. Dimon’s opinions about cryptocurrencies are so loud and harsh that they could be construed as positively violent.

The strangest thing about this is that it comes from him, the CEO of a bank that everyday moves six trillion dollars around the world by means of the blockchain technology and digital currencies. That is not my opinion, Mr. Dimon has said that himself in several interviews.

While Mr. Dimon likes and respects the blockchain technology, he believes in fiat currencies only. In his mind, digital currencies are worth nothing, and they’re going to be crushed by the world’s governments sooner or later. This seems paradoxical because it implies that Mr. Dimon, who should be an expert, doesn’t understand how fiat currencies work.

Fiat currencies don’t have any value on themselves either. They are used in their countries because law mandates it but since Nixon dropped the gold standard there’s nothing supporting the USD or any other fiat currency, but for the government’s promise to pay back interest to the central bank (the Federal Reserve in the US case). So why is this not a problem for fiat currencies according to Mr. Dimon but it is for alt-coins?

There’s more. Other comments by Mr. Dimon include,

“If you’re stupid enough to buy it, you’ll pay the price for it one day; he says,

He also believes,

“The only value of bitcoin is what the other guy’ll pay for it”

He even said that Bitcoin (and by implication all other digital coins) are just a fraud that will not end well.

The irony in the situation is that Mr. Dimon says he couldn’t possibly care any less about Bitcoin in particular and digital currencies in general, but if this is so then why can’t he stop talking about them? You can have a look at his comment’s full vitriol at this page where there is a full transcript of Mr. Dimon’s remarks. I encourage you to go there, read the full text and make your own mind about this.

The Verdict: McAfee is right, here’s why

Jamie Dimon has not been the first financial world celebrity to express skepticism about cryptocurrencies. People like Howard Marks, Warren Buffet, and Seth Klarman are also skeptics, but Mr. Dimon is not merely skeptic but sarcastic.

I, as a crypto and blockchain enthusiast, believe that skepticism is ok, I like it. A healthy dose of skepticism makes you smarter and keeps you on your toes. We’re all for that. But I also believe that Mr. McAfee is on the right in this, and Mr. Dimon is not.

I will give you the facts shortly but it all boils down to this: Mr. McAfee has done the math, knows what he’s talking about and he has a deep understanding of the blockchain technology, digital coins, and the digital world while Mr. Dimon is (should be) an expert on finances but is not that competent when it comes to digital technology, so he’s just talking about his personal and very subjective opinion about a topic he does not really understand.

So, we have several reasons to line up with Mr. McAfee, and I’ll explain them to you. For a start, Mr. Dimon and other skeptics criticize crypto coins because they’re not a good retail product such as Visa or Paypal. And they’re right about that, but they’re missing the point.

Cryptocoins have never been about becoming a retail currency but about providing the world with an offshore banking system that is fully democratic, decentralized, safe and reliable. In this regard, crypto coins could become some serious competition for JPMorgan sometime soon, which could help explain why Mr. Dimon attacks them so vehemently.

Let’s now have a look at Mr. Dimon’s specific claims and arguments, because they are very easily debunked.

He said about Bitcoin that “eventually, it will be closed.” This just shows he doesn’t understand the first thing about the blockchain technology. It’s just ridiculous, even laughable. 

There is no central authority for Bitcoin (which was the whole point from the beginning), and that means you can’t just shut it down. It runs on almost ten thousand nodes that are spread the world over.

The only way to shut Bitcoin down would be to shut the whole internet down or for every government in the world to go against Bitcoin in a coordinated effort. This hasn’t happened to achieve world peace, or in the fight against global warming. You just can’t get most of the world’s governments to work together on anything, so Bitcoin will stay around.

He also accused Bitcoin of being “a fraud.” As stated before, it’s not more of a fraud than any other fiat currency in the world today. We use them because of a convention, not because of intrinsic value. It’s true that some weird stuff goes on at times in the crypto world. There are speculations and shady dealings, but doesn’t that happen every bit as much with fiat currencies?

No fiat currency has ever been used to deal under the table and finance crime and war? But in a system that’s so widely distributed around the world as Bitcoin is, fraud is just impossible. Every user keeps a full copy of the blockchain. Perpetrating a fraud would require a single powerful person to have his way with every Bitcoin user in the world, and that’s just impossible.

Bitcoin was designed from the beginning to avoid that very problem. You cannot defraud the Bitcoin network just because you can’t control it. It’s as simple as that. Even Satoshi Nakamoto (he, or she, or they, at this point it’s more of a mythical character than a real person) couldn’t do it if he wanted. He can’t. Developers can’t. Miners can’t.

Mr. Dimon also stated that Bitcoin is a better currency than fiat only in places like Ecuador, North Korea or Venezuela. I kind of agree with him on that. These are countries in which the local economy is such chaos that Bitcoin could actually improve their conditions if they adopted it. But these very examples also show why the fiat currencies are no silver bullet; they can fail as well, and then digital currencies could take things over and make things better for everybody, so Mr. Dimon’s own declaration ends up biting its own tail.

So it’s Bitcoin ultimately going to succeed? We don’t really know; I can’t possibly tell at this point. But it has momentum going for it, it’s acquired value, it’s a reliable system, and you just can’t stop it.

Listen to Mr. John McAfee. He understands the digital world; he understands the blockchain, and his predictions have been backed up by facts until now. So if we have to choose between Dimon’s and McAfee’s opinions, we have to go for McAfee’s. And so should you.

For the latest cryptocurrency news, join our Telegram!

Disclaimer: This article should not be taken as, and is not intended to provide, investment advice. Global Coin Report and/or its affiliates, employees, writers, and subcontractors are cryptocurrency investors and from time to time may or may not have holdings in some of the coins or tokens they cover. Please conduct your own thorough research before investing in any cryptocurrency and read our full disclaimer.

Image courtesy of Gage Skidmore via Flickr

Bitcoin

Investors Beware: Another Large Bitcoin Crash Might Be Coming

Published

on

Bitcoin crash
READ LATER - DOWNLOAD THIS POST AS PDF

The crypto prices have surged quite high in the last few months. Of course, their progress is nowhere near the one seen in 2017, but they appear to be getting there, one day at the time. However, things might not be as simple as that, and according to recent performance — it is more than possible that a major Bitcoin crash is incoming.

The fact is that cryptos saw a massive amount of growth in a very short period. Bitcoin itself more than doubled its price in only two months. Now, the rally is starting to crash in on itself, and the coin is already about $1,000 lower than last week. If such development does come to pass, a lot of people will experience quite large losses, although experienced investors might find some opportunities, and leverage in order to enhance their holdings’ long-term value.

For example, Bitcoin dominance is expected to crash very quickly, which will work in favor of quite a lot of altcoins. While this does not seem to be the best time to invest in BTC, altcoins are another story, and diversifying a portfolio now might end up being very profitable in days to come.

Bitcoin behavior mirrors the pre-bear market situation

The crash that analysts are predicting right now comes as a direct consequence of all the hype that has been building up in…

Continue Reading

Altcoins

Top 3 Coins to Buy Before They Go Big

Published

on

coins
READ LATER - DOWNLOAD THIS POST AS PDF

Crypto bulls are back, that much is clear. The long-lasting, harsh crypto winter is gone, and the new era in digital currency sector opens up some rather interesting opportunities. With many more bull runs expected to come in months ahead, a lot of coins are likely to blow up and maybe even hit new all-time highs, although that still remains purely theoretical.

On the other hand, the fact is that numerous coins are seeing prices that were not achieved since early 2018, and the overall momentum remains bullish. With that in mind, even if new records do not come for a very long time — chances are that many of the coins will blow up enough for investors to see some serious gains in months to come. As a result, investing in some of these coins now might be a very profitable decision, for those who have the patience to wait a few months. Here are some of the projects believed to have the greatest potential to go big in the second half of 2019 and beyond.

1. TRON (TRX)

Putting TRON on the list should not really surprise anyone, as the project constantly comes up with new project updates, partnerships, and alike. It also constantly breaks records, as is becoming one of the biggest players in the dApp and smart contract development sector.

In the past few…

Continue Reading

Blogs

Can Crypto Credit Cards Disrupt the Fight Against Financial Crime?

Published

on

crypto credit cards
READ LATER - DOWNLOAD THIS POST AS PDF

It is commonly known that the world of finances has the biggest problem with the crime of all existing industries around the world. It has been so throughout history. While the financial world has evolved, so did the criminal activities, and they continue to be an issue. With the arrival of cryptocurrencies, many were hoping that financial crime might be disrupted. However, for now, at least, it appears that cryptos themselves cannot find a way to resolve issues such as international money laundering.

In fact, when it comes to money laundering, the crypto sector appears to be the weakest link, especially because of the nature of digital currencies. The anonymity that cryptos are being praised for means that anyone can get a payment from an unknown source from anywhere in the world. This method can then be used for financing drug trafficking, cyberattacks, terrorists, and more.

Until recently, it was not easy for bad actors to make use of cryptocurrencies obtained for illegal purposes. The number of merchants willing to accept the coins was low, and criminals were forced to find a way to exchange crypto into fiat currencies. However, this came with a set of issues, such as taking foreign exchange risks and then sending the money through wallets and exchanges to a banking system that would allow withdrawal. The banking account was the biggest obstacle here,…

Continue Reading

Elite