Thursday, June 5, 2014

MIT Review: Bitcoin Price Driven by Speculation Not for Use as a Safe Haven Alternative to Gold

MIT Review reports:

Ladislav Kristoufek at the Charles University in Prague, Czech Republic, who has studied the link between bitcoin prices and various other financial yardsticks...says there is good evidence that the price of bitcoins has been driven by speculation, both in the long run and in short term rises and falls. “During the episodes of explosive prices, the [speculative] interest drives the prices further up, and during rapid declines, it pushes them further down,” he says.

His analysis also found no evidence that investors use Bitcoin as a safe haven like gold.


  1. I must have missed Ladislav's phone call because he didn't check with me. I use it as a safe haven alternative to gold and it's worked just fine. Anyone who's held bitcoin over 12 months (at any time in its entire history) has see their purchasing power rise.

  2. I think people who make statements about "speculation" on bitcoins don't really understand what they are talking about.

    For example, I if I buy and hold copper because I think the price is going to go up, am I speculating? Perhaps I am; however, the supply side of copper could change for all sorts of reasons. Let's say the price does go up, which spurs more production. At this point, real resources are being diverted into copper production and more copper will result from this. Then there is the whole demand side to the equation where someone could create some new invention that everyone must have that utilizes a ton of copper.


    There are no supply side fluctuations, and there are no demand side uses that burn bitcoins. When people buy them and hold them, the price goes up. Even if no one were to buy anything with them, the price would go up and stay up because the supply side can't increase in proportion to demand.

    This is kindergarten simple stuff here. I can't believe so many people are having such a hard time comprehending this.

  3. What an _ss, so he went to all the wallets that have not spent there coin and asked them why they are saving them? No, he did not, stay as a professor buddy, the real world is cold and unforgiving.