‘Bitcoin Is Worth Zero’ — Kenyan Communication Strategist Warns African Investors to Be Wary

A Kenyan communications strategist, Mwotia Ciugu, has told African investors to be wary of investing in bitcoin which he claims is worth zero.

Bitcoin Structurally Incapable of Delivering on Its Promise

In an op-ed published by The Elephant, Ciugu insists bitcoin (BTC) is structurally incapable of delivering on its promise of becoming an alternative store of value or a hedge against inflation. In addition, the strategist also claims bitcoin fails both as a currency and an investment.

Although he concedes that Africa has one of the highest cryptocurrency adoption rates, Ciugu cautions, however, that the top cryptocurrency’s volatility and scalability issues mean it cannot act as a currency. Ciugu is quoted explaining:

Bitcoin fails as a currency because of two things: volatility and scalability concerns. In its 12 years of existence, bitcoin has maintained extremely high levels of volatility i.e. 60 per cent to 100 per cent annualized.

To further support this point, Ciugu makes reference to the U.S. dollar which he claims “has an annualized volatility of 17 [percent].” Concerning the crypto asset’s scalability problems, Ciugu predictably regurgitates the common arguments about bitcoin’s inefficient use of electricity and how this disqualifies it as a currency for day-to-day transactions.

Bitcoin Useful for Cross Border Remittances

Meanwhile, the strategist denies that bitcoin is now being used extensively in El Salvador, the first country in the world to declare bitcoin legal tender. According to Ciugu, the U.S. dollar is still the dominant currency in El Salvador. Despite putting forward these arguments, Ciugu surprisingly agrees that sending remittances via bitcoin is more cost-effective than using regular sending channels. He explained:

The use of bitcoin in that country is primarily for remittances by citizens working abroad to their families back home. These citizens rely on bitcoin for cross-border money transfers to avoid the high costs that come with such transactions, and also because most citizens of El Salvador, i.e. 70 [percent], don’t have bank accounts.

On why he thinks the cryptocurrency is worth zero, Ciugu uses billionaire investor Warren Buffet’s past comments about bitcoin to argue his point. In his previous remarks, Buffet had intimated the crypto asset had hallmarks of a pyramid scheme because it produces nothing. Just like Buffet, the strategist also believes bitcoin investors have no expectations of making any future earnings except through engaging in zero-sum games with other speculators.

The strategist also makes reference to how bitcoin crashed when Elon Musk voiced his concerns about the crypto asset’s energy use. Such a reaction according to Ciugu means bitcoin is more susceptible to sentiments than actual fundamentals.

The strategist ends this long article by conceding that bitcoin will probably hit the US$100,000 mark in the near future as some analysts are predicting. However, Ciugu argues that even if bitcoin were to reach such a milestone, this will have “no bearing on the intractable truths” he has articulated.

Do you agree with Ciugu’s views? Tell us what you think in the comments section below.

Link Source

Carla

Carla

Leave a Reply

Your email address will not be published. Required fields are marked *

Share:

Share on telegram
Share on facebook
Share on twitter
Share on linkedin
Share on whatsapp

Related Posts

bitcoin
Bitcoin (BTC) $ 41,842.00
ethereum
Ethereum (ETH) $ 3,114.90
tether
Tether (USDT) $ 1.00
binance-coin
Binance Coin (BNB) $ 463.99
usd-coin
USD Coin (USDC) $ 1.00
cardano
Cardano (ADA) $ 1.41
solana
Solana (SOL) $ 138.25
xrp
XRP (XRP) $ 0.744805
terra-luna
Terra (LUNA) $ 77.70
polkadot
Polkadot (DOT) $ 24.35
dogecoin
Dogecoin (DOGE) $ 0.167036
avalanche-2
Avalanche (AVAX) $ 84.60
shiba-inu
Shiba Inu (SHIB) $ 0.000028
matic-network
Polygon (MATIC) $ 2.08
binance-usd
Binance USD (BUSD) $ 1.00
crypto-com-chain
Crypto.com Coin (CRO) $ 0.443217
wrapped-bitcoin
Wrapped Bitcoin (WBTC) $ 41,845.00
terrausd
TerraUSD (UST) $ 1.00
near
Near (NEAR) $ 17.44
cosmos
Cosmos (ATOM) $ 36.92
chainlink
Chainlink (LINK) $ 22.04
litecoin
Litecoin (LTC) $ 136.23
dai
Dai (DAI) $ 1.00
algorand
Algorand (ALGO) $ 1.30
fantom
Fantom (FTM) $ 2.85
bitcoin-cash
Bitcoin Cash (BCH) $ 377.19
uniswap
Uniswap (UNI) $ 15.77
tron
TRON (TRX) $ 0.068100
okb
OKB (OKB) $ 24.93
stellar
Stellar (XLM) $ 0.253144
ftx-token
FTX Token (FTT) $ 44.31
internet-computer
Internet Computer (ICP) $ 27.82
staked-ether
Lido Staked Ether (STETH) $ 3,106.17
axie-infinity
Axie Infinity (AXS) $ 72.68
vechain
VeChain (VET) $ 0.072976
hedera-hashgraph
Hedera (HBAR) $ 0.260709
magic-internet-money
Magic Internet Money (MIM) $ 1.00
ethereum-classic
Ethereum Classic (ETC) $ 33.49
theta-token
Theta Network (THETA) $ 4.27
filecoin
Filecoin (FIL) $ 28.22
compound-ether
cETH (CETH) $ 62.38
the-sandbox
The Sandbox (SAND) $ 4.31
decentraland
Decentraland (MANA) $ 2.84
monero
Monero (XMR) $ 202.86
klay-token
Klaytn (KLAY) $ 1.39
elrond-erd-2
Elrond (EGLD) $ 177.06
tezos
Tezos (XTZ) $ 4.00
harmony
Harmony (ONE) $ 0.299174
leo-token
LEO Token (LEO) $ 3.64
cdai
cDAI (CDAI) $ 0.021832