You’re Saying Bitcoin Is a Pump-and-Dump Scheme, but There’s No Better Asset To Dump It Into (Robert Breedlove)
Choose your Bitcoin commentator carefully.
You’ll hear few people articulate a better response to the value of Bitcoin than Robert Breedlove.
Breedlove is an American philosopher, businessman, and author who only advocates for Bitcoin when it comes to cryptocurrency.
If I’m honest, he takes Bitcoin maximalism to a new level of geekiness that hypnotises you.
The type of hypnosis that makes you run on hot coals at a Tony Robins conference or run away with a cult.
Breedlove talks about Bitcoin as if it’s a religion protecting you from the tyranny of governments. His mission is to maximise humanity’s freedom through Bitcoin’s store of value.
His views are pretty deep.
Never will there be an asset that divides people more than Bitcoin, especially during this discovery phase.
Like many Bitcoin evangelists, Breedlove attracts his fair share of criticism from people calling Bitcoin a pump-and-dump scheme.
Pump and dump is a form of fraud that involves artificially inflating the price of a stock or asset through misleading and primarily false statements.
After their false positive claims, the offender would look to sell the cheaply purchased stock or asset at a higher price when there’s no underlying value.
“Many people have accused Bitcoin of being a pump and dump scheme, but when you get into the rabbit hole, you start to understand the nature of money and the history of money, the desire to the properties of money.
You realise that Bitcoin cannot be a pump-and-dump scheme because there’s no better asset to dump it into.
It’s a pump scheme.
It just goes up.”
If you bought the top of the market 12 months ago, you might think Breedlove is talking nonsense.
Bitcoin has corrected 80 per cent from all-time highs. But interestingly, its lows never go below the previous cycle’s low.
And it always reaches higher highs in each new cycle. Macroeconomic investor Raoul Pal covered this in a recent Tweet.
Below, the Bitcoin chart measures each new low, beating the previous high dating back to 2012.
Like many of the top Bitcoin commentators, Breedlove uses clever historical references and compares the properties of Gold to Bitcoin.
He says Gold, once pegged to cash, and Centralised financial institutions like the government have printed more money, undermining Gold’s value.
“Bitcoin is taking us back to the principle that underlies Gold, that’s what Gold was, it was a proof of work money, and then we built a proof of stake institution called the central bank everywhere we have made that proof of stake institution things have gotten really bad.”
Breedlove says he’s not forcing you to use Bitcoin and would never tell people to go out and buy it.
People need to think for themselves and have their thesis, but looking into the history of money, Gold, and their properties will indicate Bitcoin’s value.
“No one is ever forced to use Bitcoin. Using Bitcoin is always a choice, an option.
But it’s an option that becomes more valuable to individuals as other options are taken away through government intervention.
This is the osmotic pressure pushing people into Bitcoin over time.
(Defined as the minimum pressure which needs to be applied to a solution).
Breedlove says that Bitcoin shares five properties of money and aces each area.
“Since money is insurance against uncertainty, its demand is centred on the relative certainty of its monetary properties; and Bitcoin optimises for all five.”
I like Breedlove’s comparisons to the properties of a store value. Bitcoin, he says, is a better version of Gold.
Gold isn’t easily divisible. We pegged fiat money to Gold to create that divisibility and make it fungible. We have also printed off so much money that it makes us question scarcity.
Gold’s supply still needs to be discovered.
And lastly, he believes Bitcoin has better portability when it comes to transferring value across the world.
I can agree with all these things because they can be measured, and you can apply standard logic. Of course, it’s better to transfer Bitcoin to another person in another country than to send them the same value in Gold.
Here’s where he loses me, and my cult radar is on max alert.
“Bitcoin is Hope, and hope is the wind. Fiat currency ruins our relationships with fellow humans and nature.”
I’ll be honest this takes me to the edge of my comfort zone, getting philosophical about an investment.
And a gentle reminder that Breedlove, for all his knowledge and online following, is a man who lives in America with an estimated net worth of $5 million.
He was also a successful businessman before his exposure to Bitcoin.
His dialogue does inspire you, and even though sometimes too extreme, for me anyway, he says things that make you challenge your thinking.
“Hope moves us forward, and our values chart the way. Money is intended to be a safe harbour for economic value — not a constant cause of stress, worry, and entrapment, as it is today.
Fundamentally dishonest money, fiat currency ruins our relationships with the intrinsic entropy of nature and our fellow humans.
To rejuvenate hope for more harmonious human action in the world, we must set our sights upon the invaluable aims of honest money, entrepreneurship, and civilisation.”
It would help if you chose your messiah carefully.
Or not choose one at all. Independently make your own decisions based on your research.
I agree. Bitcoin is hope for people who do not have property rights, are charged expensive banking fees to draw their money and have no way to store value.
People in well-developed countries who get free banking and have access to a vast amount of financial tools, including borrowing, should consider speaking less about economic freedom.
I see Bitcoin as an investment.
Not a religion. And I’m yet to connect the dots between wind and nature.
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This article is for informational purposes only; it should not be considered financial, tax or legal advice. You can consult a financial professional before making any significant financial decisions.
You’re Saying Bitcoin Is a Pump-and-Dump Scheme, but There’s No Better Asset To Dump It Into… was originally published in DataDrivenInvestor on Medium, where people are continuing the conversation by highlighting and responding to this story.
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