The argument for bitcoin as a medium of exchange also doesn’t hold up, except in a few isolated cases, Cembalest said. He quoted a 2021 paper from the University of Technology in Sydney and the Stockholm School of Economics that found 355 cases of pump and dump schemes in a six month period in 2018 involving 23 million people across two exchanges and 197 different currencies.Īnd that’s not the only other issue confronting cryptocurrencies, according to Cembalest, who pointed to front running by miners and their attacks on exchanges. Bitcoin now trades around $44,000 - down more than a third since its peak last fall of almost $68,000.Ĭembalest said this volatility is partially driven by the pump and dump schemes that proliferate in the space. He noted that cryptocurrency volatility is much greater than either gold or the stock market, as its recent performance illustrates. “Central banks and Treasuries have created a massive confidence void,” he wrote, noting that venture capitalists “have been plowing money into crypto at an accelerating pace, rivaling other innovation categories.”īut Cembalest argued the main case for crypto - as a store of value - won’t hold water until more people use it, “its volatility settles into a range consistent with store of value investing,” and “it goes up or remains stable when systemic risks and/or inflation are rising.” In a new report called “The Maltese Falcoin: On Crypto and Blockchain,” Cembalest says he understands why people are interested in cryptocurrencies, given the levels of debt and fiat money since the financial crisis in 2008. The fervor over cryptocurrencies is something like that, according to Michael Cembalest, chairman of market and investment strategy for J.P. ![]() But when the devious characters played by Sydney Greenstreet and Mary Astor finally obtain the Maltese Falcon, it turns out to be a fake. ![]() The 1941 movie The Maltese Falcon - based on the Dashiell Hammett novel - is about a desperate attempt to obtain a precious statue encrusted with rare jewels.
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