Fun

‘The Black Swan’ author says Bitcoin a poor hedge against market meltdown

News Feed - 2024-08-07 03:08:45

Alex O’Donnell5 hours ago‘The Black Swan’ author says Bitcoin a poor hedge against market meltdownNassim Nicholas Taleb says gold still stands apart as a store of value.1426 Total views18 Total sharesListen to article 0:00NewsOwn this piece of crypto historyCollect this article as NFTCOINTELEGRAPH IN YOUR SOCIAL FEEDFollow ourSubscribe onNassim Taleb, author of The Black Swan and adviser for Universa Investments, said during CNBC’s Squawk Box on Aug. 6 that the cryptocurrency market’s abrupt downturn on Aug. 5 shows Bitcoin (BTC) is a poor hedge against a systemic meltdown.


“Bitcoin is proving once again that it’s not a hedge against your assets melting,” according to Taleb, whose book The Black Swan explores the science of randomness and extreme outliers.Taleb is the author of “The Black Swan,” a bestseller exploring extremely rare events. Source: Penguin 


On Aug. 5, the entire crypto market saw a $510-billion drop in total market capitalization amid a marketwide downturn. Following the sell-off, over 60% of the top 50 cryptocurrencies lost all the gains made during 2024, according to CryptoQuant.


Other asset classes bled, too. The S&P 500, an index of large stocks in the United States, fell by more than 5%, and Japan’s Nikkei plunged by around 12%. However, according to CoinMarketCap, BTC’s fall was worse, dropping by some 18% on the day.


Related:How the Bank of Japan wrecked the yen carry trade — and crypto markets


Bitcoin performed worse than other assets because it is “a speculative asset that seems to behave like high-price real estate in Manhattan,” existing mainly to “track the stock market,” Taleb claimed. He said gold is a superior store of value because with “a gold chain, if you put it on the ground 10,000 years, it will still be gold.”


Bitcoin is sustained by a global decentralized network of miners estimated to comprise approximately 1 million individuals. It has proven highly resilient since its launch in 2009, but anxieties persist about Bitcoin’s longevity, especially as its fixed supply of mining rewards — 21 million BTC in total — dwindles.


The crash was triggered by the Bank of Japan’s July 31 interest rate hike and a subsequent spike in the price of the yen in currency markets. This drove up costs for foreign borrowers with yen-denominated debt, $2 trillion of which was outstanding just before the crash, according to a report from ING Bank.


It fell especially hard on the crypto market, which collectively borrowed nearly $40 billion to finance risky leveraged trades, according to CoinGlass.


Magazine: Clicker games to fade post-airdrop, Is Hamster Kombat any good? Web3 Gamer# Bitcoin# Cryptocurrencies# Bitcoin Price# Investments# Adoption# MarketsAdd reaction

News Feed

Portal introduces ‘PortalPay’ interoperability for blockchain gaming
Vince QuillJul 11, 2024Portal introduces ‘PortalPay’ interoperability for blockchain gamingPortal aims to become the “Stripe of crypto” by lowering common barriers to entry for players eyeing blockchain video gam
Bill Gates: Crypto Is 100% Based on Greater Fool Theory — ‘I’m Not Involved in That’
Bill Gates: Crypto Is 100% Based on Greater Fool Theory — "I"m Not Involved in That" Microsoft co-founder Bill Gates says crypto is an asset class that is 100% based on the Great
Venezuelan Authorities Shut Down Power Supply to Bitcoin Miners in Key State
Venezuelan Authorities Shut Down Power Supply to Bitcoin Miners in Key State Regional authorities in one of the key states of the country, Carabobo, suspended th
Derek Andersen3 hours agoGalxe replacing 110% of funds users lost in recent front-end hack, over $400KThe platform was the victim of a phishing scam that routed users to a website that drained their wallets after they ap
Martin Young3 hours agoBinance urges users to convert euros to USDT after Paysafe debankBinance’s European debanking woes continue as it urges Paysafe users to convert their euros to digital dollars.2259 Total views22
‘Ecstasy Kingpin’ From Brockton Forfeits $2.3M in Bitcoin to Massachusetts Law Enforcement
‘Ecstasy Kingpin’ From Brockton Forfeits $2.3M in Bitcoin to Massachusetts Law Enforcement A man from Brockton, Massachusetts was sentenced to eight years in prison and forced
Tom Blackstone8 hours agoOpenAI staff tells board to resign after Sam Altman ousting: Report505 out of 700 employees reportedly signed a letter stating that the board undermined the company’s mission by firing Altman.1
AMC to Accept Bitcoin for Movie Tickets and Concessions by End of 2021
AMC to Accept Bitcoin for Movie Tickets and Concessions by End of 2021 AMC Entertainment Holdings, Inc., plans to accept bitcoin by the end of 2021 according to
President Zelenskyy Signs Ukraine’s Law ‘On Virtual Assets’
President Zelenskyy Signs Ukraine’s Law ‘On Virtual Assets’ President Volodymyr Zelenskyy has signed the law “On Virtual Assets” which aims to regulate the cryp
Gareth Jenkinson14 hours agoBitcoin Depot Q2 revenue jumps 18% YOY, eyes growth after Nasdaq listingBitcoin Depot records $197.5 million in revenue in the second quarter of 2023, spurred on by partnerships with various U
Microstrategy’s Bitcoin Holdings Reach 140,000 BTC After Acquiring 1,045 More Bitcoins
Microstrategy"s Bitcoin Holdings Reach 140,000 BTC After Acquiring 1,045 More Bitcoins Nine days after publicly listed company Microstrategy purchased 6,455 bitcoins, the firm
William Suberg8 hours agoBitcoin rejects at 21-day trendline — How low can BTC price go?BTC price fails to protect the $30,000 mark after a brief resurgence, and Bitcoin traders are not confident of new highs.3779 Tota