Everyone Is Wrong About Bitcoin: “Have Fun Staying Poor!”

That's going to zero. That's going to zero. This is going to zero too. Euros are going to zero. The Yen's going to zero. The Chinese currency is going to zero. It's all going to zero against Bitcoin. It's worthless artificial gold. I would short it if there was an easy way to do it. We're getting ready for another big dump. It's all about pump and then dump.

What's up, you guys? It's Grahe here. So I'm finally going to talk about one of the most requested topics on my channel by far over the last few months, and that would be Bitcoin. After all, in the last year, it's rallied from a low of 26,000 to a high of almost 74,000. It was consistently the best performing asset over the last decade, and because of that, it's also the most controversial asset over the last decade.

He said if you're trading this, it's like watching other people trading turds and deciding you want to get a piece of that. We've got the Bitcoin thing, don't we? Got it. They don't. That's right. Without exaggeration, this is the one subject that people either love or they hate with all of their being, and as a result of that, you have some wildly different opinions in terms of its value.

Like, on the one hand, you have several analysts who soon believe it could be priced at over a million dollars, while others compare it to smoking cigarettes or rat poison. When Warren Buffett wouldn't even pay $25 for all the Bitcoin in the world. So given the extremes felt on both sides, let's discuss the Bull and Bear cases at today's value, the realistic dangers that need to be taken into consideration, and then finally what the EXP experts believe it could be worth in a few years.

Because if they're correct, it's absolutely mind-blowing. Although, before we go into that, as usual, if you appreciate these videos or you just find them interesting, do me a quick favor and hit the like button or subscribe if you haven't done that already. It helps with the channel tremendously, and as a thank you for doing that, I'll show you a picture of a blue termit crab. So thanks so much, and also big thank you to Experian for sponsoring today's video, but more on that later.

All right, so as a super quick background for anyone who isn't aware of what's going on or how we even got here, let's discuss the beginning of Bitcoin. Because once you understand this, everything else is going to make a lot of sense. The entire concept of Bitcoin was anonymously created during the middle of the great financial crisis as a way to create a currency that was completely detached from mainstream Banks and government.

Bitcoins like this were generated using computers that solve complex algorithmic puzzles that progressively get harder and harder to solve over time. The premise is that there's only ever going to be 21 million Bitcoins in existence, and that's it. Like, as it is right now, it's estimated that 19.4 million of those Bitcoin have already been solved and mined for, leaving just 1.6 million units left.

However, because the mining process gets progressively harder over time through a process known as the halving, it's established that the final Bitcoin won't be mined for another 100 years until the year 2140. Although even though Bitcoin's price has gone up 23 million percent in the last 14 years, it wasn't without its hiccups. For instance, there have been three times in the last decade that it's ended the year more than 50 to 60% down.

But here we are yet again near all-time highs. So why? Well, lately, most of this could be attributed to one single word: demand. See, when Bitcoin was originally created, most of the demand was between people who believed in the concept, exchanged it as a currency, or saw it as a long-term investment opportunity. But now that technology is really being embraced, it as more than just a currency and instead as an international store of value, prices have taken off.

For example, in the last few years, El Salvador and the Central African Republic adopted Bitcoin as their legal tender. Elon Musk and Tesla were reportedly holding on to 1.3 billion worth. Institutional investors are beginning to pile in, and the most significant of all of this came recently with the Bitcoin ETF. This works by essentially creating a publicly traded holding company that offers exposure and tracks the price of Bitcoin without you having to actually go and buy the Bitcoin yourself.

Or basically, in really simple terms, you can buy into a fund that owns Bitcoin, and by owning some of the fund, you thereby own a corresponding amount of that Bitcoin. That has proven to be such a popular business model that in the last two months, BlackRock's Bitcoin ETF passed Michael Saylor's entire stockpile; inflows easily pass a billion dollars in 24 hours.

And with soon to be only 450 Bitcoins mined per day after the halving, there might just not be enough Bitcoin to go around for everybody without the price continuing to go up. Like, as Yahoo points out, since the beginning of February, ETFs have purchased an average of 35 to 4,300 coins each day. That's considerably more than the 900 coins being created each day by the Bitcoin network over the same period.

On top of that, since Bitcoin's supply is fixed, meaning more can't magically be produced beyond the initial 21 million, experts believe that this will be the reason it keeps going even higher. Although not everybody agrees. Although before we go into the critical arguments against Bitcoin and why some experts believe it could be worth zero, let's talk about the positives.

The fact is, even though the U.S. dollar is backed by the full faith of the U.S. government, along with the strongest economy in the world, its value has long-term declined. Like, as you could see over the last 100 years, the purchasing power of your money has consistently fallen as more of it gets printed into the economy. On the other hand, Bitcoin's supply is capped at 21 million, so there's no inflationary pressure to rot away its value.

Other comparisons have also been drawn to that of gold, which is limited by the amount that could be mined from the earth. In this case, some projections believe that soon Bitcoin will be harder and scarcer to access. It also seems as though Bitcoin is increasingly being used as a store of value in response to the banking crisis since it's fairly decoupled from traditional finance.

Of course, in terms of why this gives it value, Investopedia notes six attributes that all successful currencies must have. This includes scarcity, divisibility, acceptability, portability, durability, and uniformity. In terms of how Bitcoin stacks up, well, it ranked the highest in every single category with the exception of being issued by a government, which one could argue is probably for the best. After all, I think it's for that very reason why so many people see it as a beacon of freedom and as a way to break away from mainstream finance.

On top of that, Blockworks even took it a step further to say that the 21 million supply cap is simply a boomer myth, as they estimate the true number of Bitcoins in circulation is actually significantly lower. For example, Bitcoin's creator, Satoshi Nakamoto, amassed more than a million coins, of which only 10 are left, and that was more than a decade ago. So in essence, just right there, 7% of Bitcoin's entire supply is inaccessible.

In addition, Coin Time Economics believes that anywhere from 3.9 to 4.8 million coins could be considered lost. This estimate includes Satoshi's holdings as well as the zombie coins, bringing the total supply down to just 17.1 million. This also doesn't include people who just keep buying with the intention of holding it forever and never selling it. All of this combined with excessive demand, worldwide usage, and mainstream adoption could give it what it needs for the price to continue going higher.

Although, like I mentioned earlier, not everyone agrees with this, and there are many highly respected investors who universally believe the same thing: that Bitcoin is worthless. But before we go into that, even though there's certainly a debate on how much the price of Bitcoin is actually worth, I think there's one thing that we could all agree on. Chances are you're wasting a lot of money paying for monthly subscriptions that you don't even use.

For example, a recent survey found that the average U.S. household is spending almost $1,000 a year on streaming. Most Americans are spending $211 more a month on subscription costs than they think they do. And in a way, this is almost like financial death by a thousand cuts. Like, sure, one single recurring subscription isn't going to be that big of a deal, but multiply it by 10 or 20, and all of a sudden, it begins adding up to something substantial.

So what's the solution? Well, there are now ways to easily cut back on this or even save on services that you're already paying for. With a sponsor, Experian, they start by analyzing your payments to automatically identify subscription charges, and then you're able to have them directly canceled with no additional work on your end. Experian takes care of it all for you so this way you could focus on saving as much money as possible.

On top of that, you could also have them negotiate bills for you. They'll keep an eye out for any new deals or savings opportunities, and then they'll negotiate a better price with your provider on your behalf. This includes categories like your internet, phone, cable, home security, or radio. It usually takes just 3 to 5 business days, and so far, 81% of bills have been lowered.

Of course, in terms of how much this could add up to, the typical customer has $670 a year of anticipated savings between subscription cancellation and bill negotiation. Not to mention, with Experian, they do all the work for you, and you get to keep 100% of the savings. All of this has resulted in more than $10 million saved across their users. Like I said, most people have no idea what they're paying. They've completely forgotten about the subscriptions they've signed up for, and they're quietly being billed in the background without even realizing it.

That's why it's crucial to take the guesswork out of your money and get to the bottom of how much you're actually spending. So get started today with Experian's subscription cancellation and bill negotiation by going to experian.com/slave or using the link down below in the description. Enjoy! Thank you so much, and now let's get back to the video.

All right, so like I mentioned earlier, not everyone agrees that Bitcoin is a viable investment, and there are many other highly respected investors that all universally believe the same thing: that Bitcoin is worthless. To break this down, let's start with one of the most renowned investors in the entire world, Warren Buffett. He's famously said that you can't value Bitcoin because it's not a value-producing asset.

If you buy something like Bitcoin or some cryptocurrency, you don't really have anything that's produced anything. You're just hoping the next guy pays more. In essence, this is why he has repeatedly referred to it as a gambling token. To clarify that even further, he then went on to say that assets that have value have to deliver something to somebody, and there's only one currency that's accepted.

You could come up with all kinds of things and we could put up Berkshire coins, but at the end of the day, this is money, and there's no reason in the world why the United States government is going to let Berkshire money replace theirs. Even though this seems like a fairly rational explanation, Charlie Munger feels a lot stronger. In the past, he's referred to Bitcoin as rat poison that'll go to zero, that it's crazy stupid gambling, and anyone who disagrees is an idiot.

He compares it to, and I quote, "somebody else is trading turds, and you decide I can't be left out." The CEO of JP Morgan, Jamie Dimon, also agrees with this, slamming it as worthless and a tool for criminals. And then famously drawing a comparison to that of smoking, where you have a right to do it, but it's not good for you.

However, other leading economists have their own separate views as to why Bitcoin could potentially be worthless. For instance, Nouriel Roubini asks how could something that falls 20% one day and then rises 20% the next to be a stable store of value? An economics professor at Harvard also made the argument that people in power will move to regulate anonymous transactions, that you could be sure of, which would take away a massive selling point to using something that isn't as closely tracked as the traditional banking system.

It's also easy for critics to point to the fact that just 100 addresses hold roughly 15% of circulating Bitcoin in total value, so it's still relatively centralized. Although all of that pales in comparison to the one investor who's inspired the title of this video, and that would be Peter Schiff. I think it's going to be the biggest crash we've ever seen. And as long as there's a supply of greater fools, the fools that bought earlier can sell out to a greater fool who buys later.

He's an economist and investment adviser who's been fairly open about his distaste for Bitcoin dating all the way back to 2017. Recently, his headline has gone somewhat viral. He said, "This might be your last chance to sell your Bitcoin and buy gold and silver at favorable prices. If you fail to act, have fun staying poor." Of course, in his defense, recently gold has done fairly well, as in it's up about 10% this year, which means it's barely outperforming the S&P 500.

But the more I started digging into this, the more it became apparent that Peter Schiff really does not like Bitcoin, and he hasn't for more than 7 years. Why? Well, back then he posted a debate against the Bitcoin enthusiast Max Keiser, and his reasoning went something like this: "You've got to ask what's wrong with yourselves. I don't get it. I'm a smart guy, and so maybe I don't get it because there's nothing to get. People keep saying, 'Well, you just don't understand it.' Maybe I understand it, and that's why I don't buy it."

"You know, Bitcoin will probably not go to zero. It'll probably be a few pennies because there will always be an optionality there. You know how much where Bitcoin's going? It's going to $1,000, dude, and you're going to be on the Connecticut train station looking at your watch saying, 'How the did I end up with this?'"

"It's going to $100,000, Zimbabwe style." Of course, Max counters all of these points, albeit in a very extreme way, probably to try to get attention, but I'll let you be the judge. "I propose all you take your fiat money out tonight and burn it. Make a full commitment to Bitcoin. There's no going back! Don't ever go back! It's a brand new breakthrough in technology. Your kids are going to be wondering why their dad didn't see the value. They'd be like, 'Dad must have been on drugs because you never saw the value!' This is a cult of Bitcoin! This is your guru!"

Anyway, at the end of the day, long-term gold has been a fairly safe and stable store of value. But as an investment, it doesn't even come close, with just about every other asset class outperforming since 1974. Personally, I tend to believe that even though gold and Bitcoin could share some commonalities, as in people want a place that they could securely store their money, fundamentally they are completely different to the point where it's like comparing apples to oranges.

That's why I don't think Peter Schiff is wrong for liking gold, but I don't think it's a substitute for Bitcoin, and vice versa. They both serve separate needs, and that's why some people believe it's going up from here. For example, let's talk about price predictions. The asset manager of 3IQ said that his mid to high price range target for Bitcoin this year is between $160,000 and $180,000. Next year, it anticipates an eye-popping target of $350,000 to $450,000.

Another analyst also arrived at a $150,000 price target by assuming $1 billion worth of inflows for 2024 and another $60 billion for 2025. Cathie Wood even believes that a million-dollar Bitcoin could be possible by 2030. Now as far as the highest price prediction I've seen, Robert Kiyosaki so far takes the win by believing that a single Bitcoin will one day be worth $2.3 million. How did he arrive at that number? I have no clue.

However, to be fair, others are still quite skeptical, like Deutsche Bank, whose customers firmly believe it'll fall below $20,000 by the end of the year. Harry Dent says that the U.S. economy's biggest crash will send Bitcoin to $200, and Jamie Dimon still thinks that it's like owning a pet rock. Personally, though, even though there are a lot of critics out there, I see the appeal.

Like, Fortune recently published a fantastic piece on how cryptocurrency is seen as an intergenerational revenge on the financial system. For the first time, people could take complete ownership of their money. Younger people also increasingly see cryptocurrency as a way of providing a financial future by taking matters into their own hands and investing in something their parents wouldn't even consider.

Of course, that does come with some potentially disastrous risks, but for anyone who's bought Bitcoin and held so far, it's worked out well. Now, the problem as I see it is that some of the most vocal Bitcoin proponents also tend to be the most eccentric, and as a consequence of that, it could turn people off who otherwise would have been receptive to it, like the Max Keiser example.

Sure, he has so far been right, but even though tearing up money is certainly memorable, it probably causes some people not to take him seriously. Although then again, we are talking about him because of that, so he probably wins. This is why I believe that something like Bitcoin has a purpose, and one day it could be worth a lot of money. But as time and time has shown us, it could also drop a substantial amount, and that needs to be considered.

So with that said, let me know what you guys think down below in the comments. And don't forget that just for the month of April, you could get a $20 bonus when you go to an affiliate link at acorns.com/grr. It's only applicable for the month of April, and then after that, it's going away. So if you're interested, enjoy that $20 down below in the description. Thank you so much, and until next time!