Thursday, September 28, 2017

The "Wolf Of Wall Street" Says Jamie Dimon Is Right About Bitcoin

Jordan Belfort
Jordan Belfort, the inspiration for Leonardo DiCaprio’s character in the 2013 Martin Scorsese film “The Wolf of Wall Street,” told the Street that he believes Dimon is right, adding that bitcoin “isn’t a great model.”

“Basically, the idea that it’s being backed by nothing other than a program that creates artificial scarcity it seems kind of bizarre to me,” he said/

He also claimed that he knows people who lost money in the Mt. Gox hack, and that the incident served as a wakeup call.

“They could steal it from you I know people who have lost all their money like that..."

He went on to say, and this should scare any libertarian, "If any digital currency demonstrates long-term viability, it will probably be one that’s backed by a central bank."


(via ZeroHedge)


  1. Bitcoin appeals to libertarians who don't want to face up to the fact that the government isn't just going to disappear because Computers.

  2. I have no strong opinion about the viability of Bitcoin as a long-term alternative currency. It doesn't seem that Mr Belfort has a justifiable one.

    His concerns are (1) it's backed by nothing; (2) it's artificially scarce; (3) it can be stolen.

    Subjective value theory implies the value of everything is backed by exactly the same nothing: human desire. Unless he's making some claim to Mises' regression theorem, I can't see that his first concern amounts to anything. Even if he is appealing to the RT, one can plausibly claim that the commodity being used as currency is computer processing time. I don't see any fundamental reason why compute time is any less viable as a currency than gold. It's fairly generally applicable across economic domains. It's portable. It's infinitely divisible. It's stores well. It's pretty homogeneous.

    I don't know what "artificial" scarcity means nor how it is any different than "real" scarcity. Does he think that anyone can come along and create bitcoins? Is that any different than someone coming along and mining new gold? Or printing new dollars?

    I can see how the ease which a commodity can be stolen impacts its ability to become a widely accepted currency and, here, Mr Belfort may have his strongest point but also the one most influenced by technical progress. Certainly, the problem is no more difficult than securing any electronic form of payment including bank accounts, credit card numbers, ACH routing codes and the like. There are very bright people (with lots of incentive) to create secure stores of all value online. Either bitcoin securability rides along with these other forms of payment or it may turn out that bitcoin is easier to secure than these others. In either case, bitcoin is no less secure than other forms of payment and, therefore, at no disadvantage in the marketplace of payments.

    There may be good reasons that bitcoin won't succeed as a dollar competitor. Personally, I think Mr Wenzel raised the most viable objection, that it is perfectly trackable. Mr Belfort's opinion on the subject is simply not justified.

  3. I agree with Mark A re scarcity. Scarcity is scarcity, whatever its source.

    The "it's not backed by anything" mantra is a red herring, neither is the dollar any longer and it's still used as money.

    That said, it seems bitcoin may be more of a speculative vehicle for now than money; when used in transactions it seems to be bought, transferred, then sold immediately in many, maybe most cases. The "store of (stable) value" attribute of money is missing.

  4. Bitcoin is in a bubble says the crook so famous they made a movie about him. He probably can't find a way to manipulate bitcoin like he did with stocks.

  5. Christian, crooks usually can spot a rigged game better than others. Its their skill.