Raoul Pal Slams Bitcoin: “It’s Not The Store of Value People Thought It Was.”

Source: Peter Diekmeyer | Sprott Money

Raoul Pal Slams Bitcoin: “It’s Not The Store of Value People Thought It Was” - Peter Diekmeyer

Raoul Pal, one of the most effective critics of mainstream economics, is cashing in his Bitcoins. Gold is a better wealth preservation tool, says Real Vision Television’s co-founder.

Yesterday Pal, who once thought that Bitcoins could eventually be worth as much as $1 million each, informed Real Vision Publications subscribers that he was selling the digital currency.

“Bitcoin not a store of value people thought it was,” he told Sprott Money News, in a telephone interview this morning from his Cayman Islands home. “If core developers are talking about changing the Bitcoin code or how it works, what happens if – at some future point – they decide to allow the number of coins to expand?”

Pal also cited lack of a Bitcoin “killer app,” and the commoditization of blockchain technology – as new players chip away at the market – as motivating his thinking.

Those who have been following Pal’s advice regarding Bitcoin, which he has been pushing hard on Real Vision TV – through the prominence that he has given sector advocates, such as Trace Mayer – haven’t done that badly.

The digital currency is up more than tenfold in the last two years.

Mainstream economics “does not work in the real world”

However, Pal’s dimming view of Bitcoin is particularly important to gold investors, because he and partner Grant Williams, in their legacy platforms and the recently-launched Adventures in Finance podcast series, have been among the global financial system’s most astute critics.

Pal is particularly vociferous about the opaque econometric models pushed by mainstream academics and central bankers, who don’t sufficiently warn the public of the dangers involved.

He cites economists’ use of the qualification “ceteris paribus” (which means “all other things being equal”, but which, Pal jokes, really means “it does not work in the real world”).

This, despite the fact that while insiders understand the jargon, profession politicians and the public are left insufficiently informed by economists about the risks of policies such as rising debts and quantitative easing.

Bitcoin: like gold, except . . .

Pal’s call is also important for another reason: if Bitcoin’s allure as a store of value and a hedge against systemic collapse is dimmed, this would increase the relative value of other solutions.

That includes gold, for which Pal’s partner Grant Williams has been a particularly strong backer.

Pal’s fascination with Bitcoin echoes that of many alternative investors, who seek a hedge from what some suspect is a “Krugman Con” – sustained long-term

increasing government spending, borrowing and money printing at a pace that exceeds economic growth.

Bitcoin met many of those hedging characteristics. Despite its wild fluctuations, the digital currency provided a partial store of value outside the banking system and its encryption technology reportedly kept away prying eyes.

Read More Here: Pal Slams Bitcoin: “It’s Not The Store of Value People Thought It Was.” – Peter Diekmeyer | Sprott Money

Categories: Medium of Exchange, REAL Money

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