In July we dedicated the KCS Fireside Chat to Bitcoin.  I wrote it as much for my education as that of our clients, prospects, and friends. In our a July article we wrote,”If you thought that bitcoins could become a store of value, then the sharp price volatility seen in this currency may just change your opinion.” Furthermore, “The main reason for this volatility is that there is no underlying object/support to which the value of the bitcoin can be pegged.”

Well, if we thought that we were witnessing volatility in July, just take a look at what occurred during the last several days.  Bitcoins experienced a 29% decline in price which resulted in a loss of “value” of roughly $35 billion. At the same time, Bitcoin cash saw its price quadruple. How ridiculous!

Since neither Bitcoin nor Bitcoin Cash is a store of value, we are witnessing a very public game of Russian Roulette. Wolf Richter, Wolf Street, recently penned, “instead of being usable currencies, cryptos – CoinMarketCap lists nearly 1,300 of them, with many of them already worthless – are a form of online betting based on a new technology, and they’re subject to different dynamics than classic online betting, but not regulated or forbidden by governments, unlike classic online betting.”

If you feel that you need to participate in some of this action, we’d suggest that you tread very, very lightly!