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Warren Buffett Predicts 'Bad Ending' for Cryptocurrencies (cnbc.com)
"97% of all bitcoins are held by 4% of addresses," reports Credit Suisse (in an article cited by Slashdot reader CaptainDork). And elsewhere this week, Warren Buffett told CNBC that speculation in bitcoin and other cryptocurrencies "will have a bad ending," adding that looking out five years he'd gladly bet against all of the cryptocurrencies.
Meanwhile, CNBC senior analyst Ron Insana has his own skepticism: I am predisposed to view them as just speculative tokens in a cryptocurrency bubble that has inflated more quickly than any other in financial market history. Admittedly I'm green with envy for failing to foresee the explosive rally in the price of bitcoin when it was first brought to my attention several years ago. Having said that, there are many things I find quite ironic about how bitcoin and other "cryptos" are described. First, they are largely denominated, or discussed, in U.S. dollar terms... If the dollar is archaic, as the crypto-enthusiasts believe, why not speak only in crypto-terms...?
It's much easier to buy and sell dollars, stocks or commodities than it is to trade bitcoin and its brethren. The conversion of one crypto to another is relatively easy on these embryonic exchanges. But getting your digital wealth converted into cold hard cash is more problematic... And while the growth has been impressive, it remains very difficult to walk into any establishment and exchange a digital token for goods or services.
The article notes that the U.S. dollar still accounts for 65% of all global economic transactions, due to its status as the world's reserve currency, and concludes that "The adoption of cryptocurrencies as a global source of funds has a long way to go before staking a claim to the world's economy."
Meanwhile, CNBC senior analyst Ron Insana has his own skepticism: I am predisposed to view them as just speculative tokens in a cryptocurrency bubble that has inflated more quickly than any other in financial market history. Admittedly I'm green with envy for failing to foresee the explosive rally in the price of bitcoin when it was first brought to my attention several years ago. Having said that, there are many things I find quite ironic about how bitcoin and other "cryptos" are described. First, they are largely denominated, or discussed, in U.S. dollar terms... If the dollar is archaic, as the crypto-enthusiasts believe, why not speak only in crypto-terms...?
It's much easier to buy and sell dollars, stocks or commodities than it is to trade bitcoin and its brethren. The conversion of one crypto to another is relatively easy on these embryonic exchanges. But getting your digital wealth converted into cold hard cash is more problematic... And while the growth has been impressive, it remains very difficult to walk into any establishment and exchange a digital token for goods or services.
The article notes that the U.S. dollar still accounts for 65% of all global economic transactions, due to its status as the world's reserve currency, and concludes that "The adoption of cryptocurrencies as a global source of funds has a long way to go before staking a claim to the world's economy."
He's right in the fact that this is likely a bubble. It will likely correct. I highly doubt bitcoin will ever return to zero (unless there is a nuclear war and then so will the dollar). Every market corrects, even the stock market.
He's wrong in the fact that he thinks of bitcoin as a fiat currency. Its not and never will be. Bitcoin will be like diamonds in the regard that it will carry a constantly changing value. Bitcoin although called a crypto-"currency" should be considered a crypto-"stock".
Mike @ The Geek Pub. Let's Make Stuff!
The USD is currently important, but when it tanks it will also have a bad ending. All currencies, all governments, and all species will end. It seems like we are consistently in denial about the fact. That's the nature of existence.
When all his investments depend upon a piece of shit currency called the US dollar which is on the brink of being destroyed by the yuan.
Just wait what happens when China switches the oil trade to the yuan.
Just wait.
He doesn't understand cryptocurrency so he is in fear of it.
a crypto stock that leaves a trail distributed all over the world...
Meanwhile, I have the bitcoin challenge. Take every cent you have, the retirement accounts, banking accounts, refi the house, and put it all into bitcoin. It's a no brainer, and you can't lose.
And watch how quickly I'll get modded as troll, and no one takes the challenge.
The shepherds did so well protecting the flock that the sheep no longer believed that wolves existed.
He said he was too dumb to foresee the rise of Amazon, Google, etc. Will he say he was dumb to see the potential of cryptocurrencies 5 years from now?
https://www.cnbc.com/2017/05/06/warren-buffett-admits-he-made-a-mistake-on-google.html
Crypto currencies are fantastic investments, with their value pegged to the price of Dutch Tulip Bulbs...
Ken
You are encouraged to use new addresses for each transaction.
Fucking noobs.
...is there a single crypto where I can buy a stick of gum with it, and not incur a $30 transaction fee? No? Then these things are worthless.
Goldman Sachs, the central bank of South Korea, the central bank of Japan and others are treating bitcoin as a commodity, not a currency. Except regular commodities such as gold have a lot more liquidity than bitcoin, so it's kind of a second-class commodity. Like tulips, for example.
Bitcoin is another tulips. Some cryptocurrency will always have value, just as tulips still sell for as much as $10. But they once sold for literally 10x the annual income of a skilled craftsmen.
My personal favorite is the wikipedia's page list of what was exchanged once for a single tulip bulb, which included (among other things) four tun of beer and two hogshead of wine AND a silver cup to drink it (1 hogshead = 79 gallons, 4 hogshead = 1 tun, so clearly a beer lover).
A mania is basically when non-professionals enter the market for speculative purposes, rather than because they want/need the core item.
This is clearly happening with the cryptocurrencies. The only question is, what will their real value end up after the mania has ended.
excitingthingstodo.blogspot.com
S/He asked politely.
If Buffett knew jack he would not live in Omaha!
Buffett's barber advised him to get on top of "bitcoin thing" b/c that's where the big money is being made right now.
He's got MS DOS 6.x advice for a 4.X kernel world. The game done changed. Crypto is here to stay.
I mean, if he's so smart, why ain't he rich?
You are welcome on my lawn.
saying 97% of bitcoin is owned by 4% of addresses is a actually a pretty useless stat when you think about it.
If only I'd ignored the naysayers on Slashdot I could have held onto my APPL instead of selling at 16 all those years ago. Instead I listened to all those negative people and lost out.
Welcome to hindsight bias 101.
Looking forward, these are an asset bubble. The claimed value is "useful for exchange", but then there's an infinite number of crypto currencies possible, so that's an unlimited supply.
Go ahead, buy into it. ignore my naysaying and buy it, NOBODY stopped you buying into it, they pointed to the bullshit nature of the underlying asset claim, This is the reality of asset bubbles, people buy into it simply because they believe THE PRICE will go up, ignoring that the underlying UTILITY is going down (the utility is the usefulness, which is going as more cryptocurrencies are created diluting any unique nature of bitcoinium).
You'll also notice I used the word "bitcoinium", did you assume I was referring to Bitcoin?... i.e. the value of Bitcoin is really nothing more than a trademark that's easily confused. Bitonion, Bitnickle... how many crypto currency chains can be made? An infinite number.
Go ahead. Nobody making excuses and blaming slashdottees, buy the crap, any of it, all of it, nobody is really stopping you by explaining the comedically comic nature of asset bubbles and the suckers they suck in.
Buffet is completely ignorant on crypto. This dinosaur will be insignificant in a few years. Buffet like all other oligarchy dollar rich guys will not be in a position to participate in what is coming. Notice that he hasn't "bet" against the sure thing.
Old man yells at cloud
Task Mangler
Guy made billions by being conservative. You are internet guy with nothing. Your advice I take with grain of salt and shot of wodka.
Even Andrew Carnegie at the end of his life held what was essentially a potlatch when he realized he couldn't take it with him. THE PROBLEM with bitcoin is that you do take it with you and poof instant inflation will occur and I do not see a way to pay for public infrastructure or all the other perks of our modern society with bitcoin or other crypt-currencies that are in truth nothing more than short sighted TAX DODGES that are becoming popular with the SNAKE OIL speculation crazed morons that trade in them!!!!
This message was not sent from an iPhone because Peter Sellers really was a deviated prevert without a dime for the call
There's almost too much incorrect information in that summary to even address. Nobody cares about bitcoins. The alternate and better cryptos have a higher combined market value by far and aren't owned by 4% of wallets. The big exchanges have been around for years, it's easier to send crypto around the world than cash which is exactly the point, crypto cannot crash below the cost of hardware+electricity for long without rebounding, it has an upwards trend because of reward splitting schedules, and I demonstrated for 3 people today that I can convert BTC from a wallet to USD in a bank account in 100 seconds. So Warren is clueless and fed wrong information not to mention projecting what he wished was true into what's actually true.
If I bought 100 bitcoins back when they were worth pennies I'd have $1.3 million right now. I could be cashing out $50k a week on the exchanges. But oh no Slashdot said and still says they are worthless...
Only the State obtains its revenue by coercion. - Murray Rothbard
Why should a certain string of digits have a special value because it satisfies some arbitrary mathematical equation, even a fancy one? There in an infinite supply of digit strings and also an infinite supply of equations. The notion of "mining" is that there is some sort of scarcity involved, but infinite is infinite, NOT scarcity.
The fundamental premise of cryptocurrency is fatally flawed. Just a speculative bubble on the theory that someone will pay a higher price in the future.
Of course that's also the state of the stock market prices right now. It will be interesting to see which bubble bursts first, but I think the stock market can't burst as completely as the cryptocurrency bubble will.
Freedom = (Meaningful - Coerced) Choice != (Speech | Beer^2), and sad sock puppets' bad mods avail them naught.
Why should a certain string of digits have a special value just because it sits on a harddisk platter of a bank, even a fancy one ? There is an infinite supply of digit strings, and also an infinite supply of harddisks. The notion of "printing money" is that there is some sort of scarcity involved, but infinite is infinite, NOT scarcity.
The fundamental premise of fiat money is fatally flawed. Just a speculative bubble on the theory that someone will pay a higher price in the future.
The line "97% of all bitcoins are held by 4% of addresses," is completely uninformed. A great deal of that 97% is bitcoins held on exchanges. For better or worse, a good amount of people store their coins in the custody of exchanges. On the blockchain, they appear to belong to one person because the exchange pools them all together, but they no more belong to a single person than deposits are owned by a bank.
Currently, Cryptocurrencies are a means of allowing gamblers to gamble. This is highly constructive and productive for the general markets for a few good reasons.
Volatility in trading is a major problem. Classically, gamblers (investors) have creatively attempted to carve out niches that have had devastating impacts on society. For example, the price of grain isn't driven by supply and demand. The price of grain is driven by commodity trading. This means that if the gamblers on the stock markets who actually do not care what the price of grain is for practical reasons can generate enough trading volume to increase volatility of the share for any period of time, then due to trends, the price of grain can either be artificially forced upwards or downwards causing mass disruption in the supply chain or the commodity cost.
Let me explain, people like Warren Buffet, Icann or others of their ilk invest in companies and people who they believe in with the interest of seeing a stable and predictable return based on the performance of the companies they invest in. As such, a company with an investor like Warren Buffet will issue shares and Warren Buffet will take an interest in the company. If the company performs badly, he will along with other investors alter the management structure of the company through actions of the shareholders and the board to improve the performance of the company or change the structure of the company to dissolve it gracefully to give the best return on the investment. What Warren does is theoretically a form of inside trading as he is directly profiting from influencing the performance of the company. But trading regulations are in place to force him to act generally ethically. So for example, he can't short sell the share if he knows the shareholder report will kill the share value. He would instead have to publicly announce his trades in time to prepare the market for his change in interest and generally provide a reason for it.
The majority of traders out there however act on trends.
This means that without any knowledge of the company, they buy and sell shares which weren't issued to them by the company, but instead buy and sell shares which were owned by others through open trading. They are not gambling on the performance of the company. They have no interest in the health of the company. Instead, they are gambling on the value of the share. Often times, their behavior hurts the companies far more than they help. See, a trader will buy and sell based on whether the stock is going up or down. In some cases, dividends can be used to convince the shareholders to take an invested interest in the performance of the company, but generally, the average trader will have no particular interest in the long term aspects of the firm. Many investors buy into a company simply long enough to reap the rewards of the dividend and then dispose of the share shortly after.
I can go on, but in general, trend traders which are basically nothing more than gamblers trying to sell high and buy low based on upwards and downward trends have major negative impacts on the shares. Consider the "Essential Phone" which was just another Android phone. The leaders of the company managed to hype the share so much that the market cap of the company reached a billion dollars long before it ever sold a single device. The people who hyped the share, even if it completely tanks will still manage to walk away with a lot of money on their pockets. Many people will lose their investments but several people, thanks to an amazing stir and incredible management of selling the share will walk away wealthier than ever and start their next venture.
Cryptocurrencies provide a new gamblers hotbed. Thanks to the insane volatility of coins and lack of regulation, buy low sell high is an easy game to play. People excited about upward trends can ride it out several times a week. If they can manage to shift money in and out of the currencies, they can produce amazing returns on investment. These people have
Please address your question to Adobe, Autodesk and others. Their software is "just a string of digits".
a tether is backed a by a usd. and what is a usd backed by ? It's turtles all the way down. Tether doesn't solve any problem. It scams people by giving the impression of solving a problem.
Speculating wildly, I wonder if the data associated with a bit coin value COULD be used for mass surveillance. Like either adding an additional value onto some other data string, OR creating a value that would match other patterns that match not only one, but multiple patterns (depending on how the value is processed in the first place), that when processed might give clue, not to some single specific coin value as such, but other tag like values that could tag you or the things you pay for such that the money is secretly marked. as for example having been used for drugs, large money values, foreign transactions etc.
Having said that, I know next to nothing about crypto currencies, but I do not trust people that either comment on, design, or working with computing, software and anything to do with building or regulating the current infrastructure of the internet.
It all seems like a horror show to me.
if Warren would short all the Crypto's, he should also short the dollar. The dollar is being printed to infinity and is losing value fast. It has lost 93% of its value since 1913. These coins at least have a limit, so their value vs. the dollar will probably increase if anything
The difference being that fiat money is backed up by a government institution. Of course, the actions or inactions of that government could damage the fiat money (Zimbabwe), but many governments are trusted globally (USA), at least from an economic point of view.
The society itself becomes dependent on the fiat money, and those in the government as well as all of the individuals subject to the laws of that government have alot to lose personally if it fails - therefore they will do everything they can to prevent that from happening.
The problem with cryptocurrency is that there is no one to be held accountable. If it all goes tits-up, then the only losers are the people who are left holding it, society as a whole will continue.
If you could only have one, which would you rather hold, gold, government-backed currency, or Bitcoin? Only two of those are going to be able to pay for your next meal right now, and only one easily.
In the first great bank panic in the United States, the Panic of 1819, Murray N. Rothbard, now an intellectual fig-leaf for the anarcho-libertarian alt-right, noted the stress on the flourishing banking system, which could legally print its own scrip, had as those convertible into specie (then gold or silver) enjoyed a premium over those that could not, causing a carry trade that eventually sapped the Second Bank of the United State and finally a general run and collapse.
I think it a weird privilege to see the biggest financial bubble in history play out, despite the suffering it will cause--and not just to those holding Bitcoin.
OK... where to start. A lot of what you said about Bitcoin, is alrightish. Everything you said about the stock market is pretty much dead wrong.
Warren Buffet isn't a regular trader. He is a hybrid between a lender and trader. His funding doesn't come from purchasing the same shares as you or I would. He gets special control, walkout clauses, and schedules. He also has restrictions like not being able to do shareholder control, or having to hold the shares for X time (similar to CEOs). So he might give a company $9 million in funds, but he won't be able to sell them for 5 years or he can if the price goes below $X (many times even above $Y). He might give it based on the the company focusing in a specific market sector or putting it into R&D, etc. He might guarantee that he will provide the funding over the next 10 years on a $1 million per year basis but that the price can't fluctuate outside a certain window. Etc.
Mr Buffet doesn't do trading like we do. A elephant can't move like the mice in a glassware shop.
The vast majority of the institutions that act in the stock market are government/company pensions, retirement accounts, insurance accounts, escrows, and rich entities (ie: trusts, rich people/companies, estates, etc). If they played on buy low, sell high, they would just be stealing funds from each other. They aren't stupid, nor foolish to believe one will beat the others. If that's all the stock market is, they can stick to far more fun games (ie: commodities trading, futures, & currencies). These entities are also well regulated (so is Buffet), they aren't allowed to do pump & dump, nor invest widely in unregulated entities like Bitcoin (thou they can still plan regulated exposure).
This is why private unregulated hedge funds were and still are so popular. The majority are them are very successful but some get too big. Of course its a winner-loser game for them so losses are spectacular (ie: Madoff, Cohen, Rajaratnam, ...).
"97% of all bitcoins are held by 4% of addresses,"
And how is this different from stocks or bonds? An enormous fraction of all wealth is owned by the wealthiest 4%, like Warren Buffet.
I think the staying power and value of bitcoin will be continue to be due to people in nations like South Sudan and Venezuela with high inflation rates and limited access to trading in other currencies.
"97% of all bitcoins are held by 4% of addresses"
Oh, so concentration of wealth is a stability concern with cryptocurrencies? Warren Buffet is one of the top eight people who hold as much wealth as the bottom half of the human population. Didn't seem to stop him from becoming a billionaire, which is a level of wealth concentration that serves nothing more than Bigger Dick syndrome.
All of this doesn't really matter anyway. Obscene Greed will continue to drive automation and AI to replace the concept of human employment. The justification of higher education will erode. UBI will become the worlds most popular form of income, which will create the global welfare state. Probably won't take long before unrest sets in, and the concept of Eat The Rich comes to fruition.
Unless we find a cure for the disease of greed, we won't have to worry about the crypto-toys used in the economy game.
So have you (and the other responder) invested any real money in cryptocurrency? If so, you're welcome to your gold rush. Don't say I didn't warn you.
I actually think there is still time to profit from the foolishness. However I do NOT think I am smart enough to know when the bubble is going to burst. Once you start gambling, it's just too easy to play one more more hand and put down one more bet.
As regards your "substantive" reply, please tell me what function you think is performed by a bitcoin or any other cryptocurrency. I already know many functions that actual software performs.
Freedom = (Meaningful - Coerced) Choice != (Speech | Beer^2), and sad sock puppets' bad mods avail them naught.
You can use companys that trade fractions of gold like goldmoney.com and then yes you can buy a stick of gum with gold and a .05% transaction charge.
If you're asking for $14,000 USD in exchange for it then yes; I'd turn you down. Giving it to me for free? For sure I'll take it.
The premise of the Credit Suisse article is wrong. A bitcoin "address" does not mean a "person". Some addresses are pools held by exchanges or funds for a great many people. (Just like stock held in street name ... so you'd think these wall st guys would get it.) Some individual people have many addresses. So addresses to people is not 1:1. It can be many:1 or 1:many, and you can only learn a limited amount about concentration from the blockchain.
What is it about Bitcoin that makes people throw logic completely out the window? It's a really obvious bubble, and in many ways worse than most bubbles because there is literally nothing of value underneath it all. For example the housing bubble(s) (plural because it's pretty cyclical, seems like we're on the up-rise of another one now) -- at least when it pops, you have land & structures to show for it. Did you pay too much for that at the top of the bubble? Yes, but you can still turn those into income to help cut your losses. Stock bubbles -- same thing, history has shown that if you play the long game, the bubbles and their popping aren't really as devastating as they seem.
I'm not sure -- did people behave like this when the beanie baby craze was going on in the 90s? Did they react with insults and call you stupid if you tried to point out that it's a bubble? I knew lots of people who were in that bubble, and none of them are rich now -- do YOU know any beanie baby millionaires? Possibly the CEO of Ty...
So Bitcoin is obviously a pure speculation market and has no intrinsic value -- what scares me more is how defensive people get when you say that. Look at the above comments for examples, there are plenty!
My advice to BTC prospectors: Get out now. If you got into BTC early, great -- you should be able to turn that into a ton of spendable/investable cash! "But won't it cause a crash if everyone gets out now?" you ask -- possibly, but first of all it's better to be the cause of the crash by protecting yourself than the victim of the crash by waiting too long. Also, since 97% of BTC are held by a few people, the crash isn't likely unless those 4% start selling off, too...
$600 per BTC
If you're paying more than that, you're giving your money to some rich dude or some BOFH.
The US$ is backed by the economy and military might of the USA.
expect crypto currencies to plummet. A huge part of their value is making exchanges on the black market. If you add to that a crackdown on ransomeware like they did to botnets in the 2000s and a money laundering crackdown all you've got left are the speculators, who'll jump ship when the black market financial base of the trading networks. That just leaves legitimate businesses and hobbyists. Businesses will just use it as a lark since they'll find it too slow and too volatile to use and a few hobbyists won't keep the whole thing going.
It really comes down to politics. What's mildly worrying is that bitcoin is so valuable now that it's possible the big players may throw in with the Pharmaceuticals and private prison industry to keep drugs illegal. If I was a bitcoin billionaire or even millionaire it'd be worried about it.
Hi! I make Firefox Plug-ins. Check 'em out @ https://addons.mozilla.org/en-US/firefox/addon/youtube-mp3-podcaster/
Gold's other various uses do add some inherent value but only a fraction of it's valuation. Most of its valuation is about rarity and tradition.
Ethereum has an infinite number of other possible uses with contracts and sub-currencies. It also has rarity. The contracts can actually by any kind of programming. Sub-currencies can be any kind of blockchain thing, as Crypto-Kitties have shown.
I view Ethereum as the future of blockchain currencies. The others are essentially immortal but may likely reduce or at least hold more still in value in the long term. Another exception might be those that target anonymity for the sake of things like, illegal transactions or highly private transactions.
Bitcoin has fewer flaws than any crypto currency. There is one fundamental "flaw" most people complain about ...
Here's the one fundamental flaw that gets little attention: mining is not decentralized.
;-) Blockchain technology is like internal combustion engine technology. Bitcoin is like the Ford Model T, an early user of the technology, the first to gain wide acceptance and mindshare, but entirely replaceable by the inevitable competitor with newer and better technology.
Bitcoin has deviated from its design and its security is compromised. The security of the bitcoin blockchain is based on the assumption of a globally distributed network of ordinary users using their computers to maintain the blockchain (mining). There are two deviations. First, mining is dominated by a small group of individuals/organizations with expensive specialized hardware (ASICs). This makes a 51% attack plausible should a cartel form, note that a mining pool reached 50% a few years ago. Secondly, 70% of miners are located in a single country and dependent upon government supplied inexpensive electricity. This makes government interference or manipulation plausible. With distributed mining cartel and government interference was not plausible, but with the current mining situation both are plausible.
This is fixable, it is software after all. However the necessary software updates (ASIC resistant mining algorithms, updated as necessary - already in use by other coins; maybe a move from PoW to PoS - we'll see how that goes with etherium; etc) have to overcome inertia, politics and greed - the voting on such changes will be done by the miners who like the current system and have expensive ASiC hardware that need to be paid for. Users can only abandon bitcoin and move to another coin.
Bitcoin may be replaced in the short/medium term, I don't know about Buffets 5 year timeframe but in general he is likely correct. The future is blockchain technology, any individual coin is just a user of that technology and entire replaceable.
What we need is a car analogy.
Now some of you might be tempted to mention network effect. Network effect requires a high switching cost. Users have little switching cost moving from one coin to another. Miners have a high switching cost and that is why they will resist algorithm changes, but users are quite free to move on to something new.
It's his job. He and Elon Musk "make predictions of doom" which their cabals then cause directly. Because they told you about it first, they can proceed. It's their cult religion. Everyone knows the plan with Bitcoin is to sink it after everyone invests in it. All you have to do is take the computers offline.
Bitcoin addresses are trivial to create. I'm not sure about the methodology of the study, but even if it was counting addresses with "dust" in them and not addresses with "nothing" in them, it wouldn't be too surprising to find out that the vast majority of bitcoin addresses created have been discarded as worthless, over and over again. I'm about to transfer my bitcoin to a new address, for instance: at this point I represent probably 10 empty addresses and 1 address with some currency in it, and I never did any of that with some algorithm that created new addresses for some odd reason or other or anything like that.
This is the equivalent of saying bad ending for automobiles when Ford and co were just starting to get them out the door. 90% of the hate here is from people who just haven't gotten in or even gotten it. The markets are exploding upwards. More and more countries are getting on board. The technology is in use in other markets and by many many companies already. Employment is growing steady and so is education. You guys got to remove the frigging blind folds sometime and realize this is a fucking new industry not a damn tulip. Geez
Okay! Make a half million in 2 months and keep calling wolf. Easy money is easy and Warren is jealous of these young millennials starting to invest in something that is the future.
Gold's utility isn't significantly more than copper from an industrial perspective. Silver's is even less than copper.
It sure seems the early goers are reaping the reward of later investors. When ppl see this and stop paying in, the cryptos will fall
I'm not a lawyer, finance pro, anything like that, just a guy. None of this is advice. None of this is a financial advice or opinion. Now that the legal bullshit is out of the way...
Warren is a master with the traditional finance. However this is all new computer based currency, which he has no experience with. He's just like most of us are, stupid in the subject. We will be trading with something that computers can understand. May not be bitcoin, could be something like tron or many of the other currencies out there with a good backup. Many people don't even realize that these coins are backed by something. In the case of Tron there is a very active guy promoting and making it into something. Some others are shit coins. There is nothing behind them, they're a joke. There are scam artists out there, be careful. Good example of a coin to stay away from is doge coin. Not that they are scam artists, they did it as a joke years ago. However it's still out there and people are buying it not knowing.
I see that the first comment was modded down, the fact that Bitcoins are in satoshis. That shouldn't have been modded down, it's correct and shows the ignorance of people with mod points.
There will be a LOT of money made in this area. There will be a lot of losers as well. If you don't know what you're doing, don't do it. It's like the stock market. In fact very much like the stock market although it can be a lot more volitile and there are no regulations (right now). Someone can pump and dump and there's nothing you can do about it. You also have to make sure you're following tax laws. That is, every trade is a taxable event. You can't just trade one for the other and not do your paperwork/pay taxes. Understand that unlike your wages, Uncle Sam wants his money every quarter. So if you make a million in January/Feb, he's going to want his money now and not next year. If you wait, you could be in big trouble. It's called quarterly taxes.
If you get into this stuff, MAKE SURE YOU SEE A LAWYER/Tax Pro. Don't be like other criminals and think you'll get away with it. Jail is full of people like that. Don't let yourself be an example.
The strings of 1s and 0s in my bank account mean that I have control of a certain number of US dollars. These are valuable in that I have to have them to pay taxes and government fees and (potentially) court judgments. Moreover, everyone in the country is required to do basic accounting in US dollars, which makes it a very convenient currency to use around here. The US government has a vested interest in not letting the currency collapse, because that would allow me to pay taxes and government fees with worthless money.
"When you have eliminated the unacceptable, whatever is left, however improbable, must be the truthiness" - Holmes