How useful and dangerous accommodation in bitcoins
Method of raising Finance in cryptocurrency startups through embed the ICO (Initial Coin Offering, by analogy with the public offering of shares — IPO or Initial Public Offering) is gaining immense popularity in the world, the volume of funds can become comparable with the classic exchange financing.
I admit that the further development of ICO's business could lead to a third world war. In the rapid development of business, the ICO has a really comparable risks. Little known, but nevertheless, it is a historical fact, is that one of the main economic causes of the Second World war was the U.S. stock market crisis, because the economy is the root cause of most of the military conflicts, which we know from sociology, peace and conflict studies, the works of V. I. Lenin and Ayn Rand.
If simply, after the First world war reparations drove Germany into severe economic conditions, then in the 30s on the stock market in the United States swelled to an extraordinary size bubble. The exchange was full of scams and many stocks were bought on credit. Bubble at some point burst, the crisis occurred, the US imposed sanctions against Europe, of course the sanctions, and Europe has entered the reverse sanctions against the United States (sounds incredible!). In the time to figure out who is cooler failed and the economies of both continents plunged into economic chaos. The latter was a prerequisite to the coming to power of the Nazis in Germany. Clouded thoughts about "hungry stomach" Europeans believed in anything.
On another continent in the 30 years of the Great depression, which redefined the role of gold and means of payment in the economy. Gold before the era of mechanization was the perfect equivalent exchange to work - hard to get required mainly for decorations, corny beautiful, and the beauty of people tend to think on a full stomach, in between a good looting neighbors. That is, gold was hard to get over that and turned it into the equivalent economic power.
After the era of mechanization (closer to the XX-th century) the value of gold began to change dramatically, human labor was widely replaced by machine. In the first place began to emerge energy: coal, oil and other fuel for cars. The process has accelerated nowadays (Fast forward). Money is no longer backed by gold. Gold was the oil. For how long? In the 2017th quite possible that the plant in a decent country work people produced 15,000 cars a year, as people are replaced by robots. Bitcoin is the equivalent of unnecessary for the operator of computer power and could reflect economic power. In a sense, is a return to gold.
Bitcoin does lots of other advantages is its cross-border proceeds from a fundamentally different model of trust, built on confidence in mathematics, and not the reputation of a third party. The primary appeal of projects in the blockchain is independent from the reputation system, trust is based on mathematics. Blockchain – a distributed system for storing data in the blockchain is impossible mathematically to fake the data recorded in the blockchain do not require assurances from any third parties including States.
Traditional trust system is a system built on reputation, trust, so the maximum degree of confidence offers the state. In fact, if you put the question, and why exactly the state trust – the answer lies in the concept of "power", the ability of the state to coercion of his will of citizens, and also the power to dictate terms to other States. We trust the government, not because it is right, but because it can force us to agree with him anyway. That is a reputation-based trust model is largely "power" model, confidence is the military power of the state. The mathematical system of trust based on mathematics, which as you know is an exact science and the exact opposite of the truth is always one.
Reputational model contains excessive cost – the cost of reputation. By and large it is the cost of "power" that provides a level of confidence. The cost of reputation is a price barrier that does not allow to expand a circle of participants of the investment market over the existing one. For example, the highest reputation has a Bank with a state license and state guarantees. But a modern Bank, 80% of staff is compliance, that is, in essence "force" to ensure his reputation. That is why the thus constructed system of relations does not allow to raise funds in small and medium — sized business is logically and financially contrary to the very concept. The higher the reputation, the more expensive it is. The audit from PwC is expensive.
The backbone of the economy is the product and its cost. In any investment process, there are liquidity measures in reducing which to a certain level, when investments in non-liquid product reaches a certain level of investments in liquid, inevitably there comes a collapse.
A prototype of a possible crisis of the model of the bitcoin happened in the famous dot-com crisis in the 2000s. His main reason for investment was brought under the alleged new economy, in which the word "Internet" actually changed the real product. The main value of the Internet from an economic point of view is the reduction of product cost by saving on transport and communications. So survived and developed those companies where cost-Internet component was the real saving factor, for example, Amazon or Ebay.
The process that is currently taking place to ICO close with a story of dotcom, because the funds involved in fact, the word "blockchain" - without the real use of the nature of the blockchain in the product fails the primary purpose of the new technology in any product – saving.
How to predict bitcoin crisis and future global drama? The famous investor Warren Buffett popularized ratios — stock market capitalization to GDP. It is possible to compare the economic performance of the current time and the period preceding the First world war — the US GDP and stock market capitalization (FCC) in the United States, with market capitalization of technology companies NASDAQ: 1929 US GDP was $103 billion, the stock market capitalization of $89 billion (or 86% of GDP) and in 2016 GDP is $of 18.56 trillion, stock market capitalization $23,8 trillion (or 128% of GDP), and the capitalization NASDAQ — $6.8 trillion
Capitalization of the US stock market exceeds its GDP by almost 30%. Last megacrisis came only when the figures came closer to each other, the dotcom crisis the ratio of capitalization to GDP was 150%, but the dotcom crisis did not end until the destruction of the twin towers and the introduction of the famous Patriot Act. Now the high-tech market capitalization is 28% of the capitalization of the entire stock market in the United States, and 36% of the US GDP, in other words, the rapid development of high-technology market after the dot-com and gave a very long delay in waiting for liquidity products and its realistic assessment. It is not infinite.
If you compare bitcoin with the main economic indicators, the total cost of 16 million bitcoins (btc) in circulation at the rate of $1350 (at the time of this writing) is $21.76 billion, which is less than 0.1% of the capitalization of the stock market in the United States, or 0.32% of the NASDAQ. Therefore to capitalization of bitcoin compared for example with the NASDAQ in the future, the rate should be about 300 times higher, i.e., $405 000 for bitcoin.
According to forecasts from April 2017 first investor in Snapchat billionaire Jeremy Lew and co-founder of the largest technology companies Blockchain Peter Smith, the famous entrepreneurs from Silicon Valley, who publicly listened to politicians Barack Obama and David Cameron, the cost of bitcoin will exceed $500 000 by 2030, and will be approximately $8.1 trillion (or 126% of the capitalization NASDAQ in 2017). In other words, the ratio of capitalization to GDP, if capitalized bitcoin will be mainly in the United States may be on the order of 200%. Perhaps even capitalization of bitcoin organically submenu capitalization of the NASDAQ.
Currently, the bitcoin economy exists de facto in a parallel reality. All or almost all projects funded are in pre-seed stage. In fact, in the real economy, this process is not involved. Therefore, a turning point, contrary to the opinion of other experts, I do not believe the introduction of bitcoin in a legal plane in Delaware, Japan or Switzerland as a means of payment. Turning point is a model of the development of the ISO business that is essentially a model of penetration in the real economy, the moment when bitcoin will be invested funds in a real working business, on the same Facebook.
Here it is at this stage and appears a fork in the possible ways of development – whether in the model of capitalization of the real economy is already inherent logical flaw? Then the product cost will actually increase due to the use of new technologies illogical way, not decrease, instead saving trust, on the contrary will have to pay three times more auditors for the auditing of the blockchain and to keep their taxes increased three times the number of government parasites that will control the turnover of bitcoins.
Thus on the basis of forecast Jeremy Lew, (including growth rate to 2030) in General, the whole technology sector investment is already capitalized bitcoin. If you go bankrupt Google and Facebook capitalized bitcoin, probably, in a global sense, nothing bad will happen, as was the situation with dotcanada. 2030-WMD is highly likely we will all move on Tesla running Linux on Google maps, and if in 2030, the year will bankrupt Facebook and Google, because the mechanism of investments in the digital economy at the stage of development of the ICO was there is a logical error, the consequences of the inevitable collapse of the bubble will be comparable to the great depression in the 30s, which in turn can cause a military conflict on a comparable scale.
How to be a pioneer in this industry? They will be those entrepreneurs who will be able to transfer the existing enterprises completely in the blockchain based on the real value of technology, this new digital economy.
In my opinion the real ICO blockchain project without creating the effect of bubbles may take into account the following factors
the author of the news: Paul Wroblewski
Forbes Contributor
source link:http://www.forbes.EN/company/343901-blokcheyn-ico-human peril-tretey-mirovoy