Is bitcoin real? Who’s in charge? And what will the price be at the end of 2018?
These are a few of the 3,500 questions Yahoo Finance readers asked when we ran a survey on bitcoin and asked what was on people’s minds. Many respondents asked similar questions, so we winnowed the list down to 74 and marshaled a team of Yahoo Finance journalists to provide the answers, which you can see here. In the podcast above, Jared Blikre, Alexis Christoforous and I discuss a few of the things readers are most curious about. (You can also download the podcast from iTunes or acast.)
In the podcast, we also address some econo-philosophical issues regarding bitcoin. Why do people place value in something with little usefulness in real life? Is it just mob psychology? Or a sign of something big? And what if bitcoin is just a fad?
Bitcoin itself will provide many of those answers over time, as investors test its value (and hackers probe its resilience). For now, bitcoin is a fascinating window into the way markets for new products form and the way society defines value. It may be the most consequential development in markets since the dawn of the Internet in the 1990s.
When we polled the Yahoo Finance audience, we also asked some questions about their views of bitcoin and other cryptocurrencies. Of more than 6,300 respondents, about 24% said they had purchased bitcoin or another cryptocurrency at some point during the last few years. Most said their holdings amounted to less than $10,000. But 11% said their holdings exceed $100,000 and nearly 5% said they owned more than $1 million worth of cryptocurrenices.
We also asked whether people think bitcoin is a bubble or an enduring asset. The most common answer: beats me. Here’s a breakdown:
In the podcast, Jared, Alexis and I also discuss what might happen if bitcoin is a bubble, and it bursts. A few bitcoin millionaires will be sorry they didn’t cash out, for one thing. If there’s a sharp plunge in bitcoin prices, some owners could have trouble selling, adding to a panic. And there are probably some speculators who have gotten in way too deep, by investing money they can’t afford to lose, and would suffer genuine hardship. If it turns into a bad year for bitcoin, we’ll find out who many of them are.
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Rick Newman, who owns a small amount of bitcoin, is the author of four books, including Rebounders: How Winners Pivot from Setback to Success. Follow him on Twitter: @rickjnewman