Bitcoin Is Backed By Nothing
Updated
Many Bitcoin traders thought that the Fed money printing and shortage of coin drives Bitcoin price up. However if you take a grain comparison of Bitcoin prices vs Fed supply of money M0, M1, and M2; the growth of Bitcoin can't be justified at all. If this is driven by devaluation of dollar, it should somehow close to the trend value of Gold. However it doesn't anywhere close to the sensible growth value by any measure. Bitcoin is dangerously overvalued! What will happened if all 21 million of coins are mined? Currently there are 18.5 million coins already in circulation. There are remaining 3.5 million to be mined. Mining the remaining Bitcoin is getting extremely hard computationally. And if the rewards from mining doesn't cover the cost, many miners are going bankrupt and close down their business. So Bitcoin network are doom to disappear along with all your money! This is just a pure speculation and massive bubble.
Note
Correction: "There are remaining 2.5 million to be mined."
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