Bitcoin Crashing

(12/18/2013) After Chinese government officially challenged the validity of Bitcoin, the value of Bitcoin continued to drop further. Today (12/18/2013), the Bitcoin dropped 17% when "the People's Bank of China (PBoC) has ordered third-party payment providers to stop using the virtual currency." Without a trusted central financial institution (like US Federal government), the users of Bitcoin have to transact on a software follows Bitcoin Protocol. "Users send payments by broadcasting digitally signed messages that transfer ownership of bitcoins, the unit of currency." I never have trust on Bitcoin, and even doubt its function to be used as a transaction currency. Look at the historical value of Bitcoin, if its value fluctuates so dramatically, how can it be used as a currency? Bitcoin itself has become a speculation commodity like gold or oil. When an influential player (like China) challenges its validity, it crashes. It eventually proves to be just a bubble.

Bitcoin historical price accessed on 12/18/2013

Bitcoin price on 12/18/2013.

(3/5/2014) Not only Bitcoin's volatility is a concern, it's safety just damaging the currency's credibility even further. One week ago, the world's biggest bitcoin exchange, Mt. Gox,  filed bankruptcy as nearly half a billion dollars worth of bitcoins were stolen due to computer hacks. Today, another bitcoin exchange, flexcoin.com, is shut down due to another hack and a loss of around $600 K worth of currency. The Japanese government now considers a regulation "adding that banks and securities firms will not be able to handle bitcoin as part of their main business, suggesting the crypto-currency will be treated more as a commodity, like gold." It may means the day that bitcoin survives as a currency is soon to be over.

Money, Money, Money

(10/17/2012) Money is always a game changer in business. To be more exact, what I mean is that the currency exchange is a game change in international business. Is Chinese RMB (Renminbi) still manipulated at a very low level? That is one of crossfire topic last night in the presidential debate between Romney and Obama. This article provides you some evidence that RMB has been relatively appreciate its value in the last several year.

I often hear that American accuses Chinese government currency manipulation that causes their trade imbalance and job loss issue in the U.S. Then the Chinese accuses American (people and government) spending too much money and own a lot of debt to foreigners. In Chinese, it says "一個銅板不會響", which means that you cannot make noise with just one quarter and both sides should be blamed. I agree with that. However, who will eventually win? Well, I think American, RELATIVELY.