BITCOIN is more of a “speculative vehicle” than a real currency able to survive in the traditional trading world, according to Ira Epstein, Director at Linn & Associates.
Bitcoin will not have a traditional trading use in 2018, said Director of the Ira Epstein Division at Linn & Associates, Ira Epstein.
The financial chief laughed at people trading bitcoins during the Christmas holidays when the cryptocurrency suffered a major fall back.
In an interview with Bloomberg, he said: “On Christmas day I couldn’t believe it, I was watching the market and there they are. These people are all trading.”
Mr Epstein said that the problem that bitcoin has are its exchange contracts, “specifically the Chicago mercantile at five bitcoins and even the CBOE at one, both should become smaller size contracts,” he added.
“What makes bitcoin so appealing to people is you don’t have to buy a full bitcoin, you can buy it in partial sizes and they trade in volume.
“As I see it, the business model for the exchanges are fees. They make a fee off of each transaction. Lower the amount of the sizes that people can buy, you get more people playing, you’ll have more fees.”
Mr Epstein explained: “What we both know is there’s no delivery. So without a delivery of a physical good item, it’s all cash. The fear that people have, of course, is that the market starts going up and what’s to stop it? You can’t throw gold at it, you can throw anything at it, it’s a bitcoin.
“So we’re in the learning process. I heard Goldman Sachs will have, by June, a full cryptocurrency desk up and operating, so it’s going to get more of the traditional players approaching it but because there’s nothing to really hedge, I question the traditional use of it.
“I think it’s really more of a speculative vehicle. It has no purpose right now other than speculation.”
He mocked the cryptocurrency: “I cannot go to McDonald’s with my bitcoin and get some coffee.”
Mr Epstein is not the only financial expert to ridicule bitcoin and its virtual wallet holders.
Chief Strategist of Bubba Trading Todd Horwitz also teased the cryptocurrency aficionados saying people are currently trading in the “Wild West Trade” with bitcoin.