It’s better to stay away from Bitcoin, which is rising rapidly again.

Bitcoin is going crazy again , which is related to the recent expectation of the Fed's interest rate hike. But it is obviously a closed market with ups and downs, so ordinary people should stay away from it.

On May 29 , the price of Bitcoin once rose to nearly 4,000 yuan per coin, a 30% surge in a week . It is really a one-off speculative hype after the stock market, gold and other commodities. Bitcoin, with its "advantages" such as anonymity and complete decentralization, has entered the financial market after being beautifully packaged. In the past few years, it has been enthusiastically sought after by Europe, the United States and Japan, and the price has soared from almost "zero" to $ 1,216.73 (about 8,000 yuan), exceeding the price of gold at the time!

However, due to the uncertainty of Bitcoin's trading platform, large fluctuations in delivery, and illegal use, such as scandals involving smuggling, drug trafficking, pornography, money laundering, and illegal transfer of assets, it has been suppressed by governments around the world.

As governments around the world continue to strengthen their regulation of Bitcoin and as market makers take profits, its price has plummeted from a high of $ 1,216.73 to below $ 250 , a drop of nearly 80% .

In the past two years, Chinese investors have played a pivotal role in the small “market” of Bitcoin. As early as in September -November 2013 , within just three months, the price of Bitcoin once rose from RMB 800 to RMB 8,000 per coin , a nine- fold increase that attracted a large number of Chinese speculators to pour in.

When Bitcoin was invented, it was expected to replace legal tender, but when it entered the market, it went against the original intention! Now, anyone who invests in Bitcoin, in addition to illegal use, often hopes that it will continue to appreciate, or hopes to continue to speculate and make profits. But Bitcoin can't even play the role of currency, how can it replace legal tender?

In fact, there are two kinds of "Bitcoin" in the market: The first kind of Bitcoin is the fantastic blockchain- technology Bitcoin . This is a future form of currency, that is, virtual currency . Currently, companies related to it in the world (including Silicon Valley) have invested hundreds of millions of dollars on this basis to establish a business model for frictionless mobile assets.

What is virtual currency? The European Banking Authority defined it in 2014 as: "A currency that is neither issued by a central bank or public institution nor necessarily linked to a legal tender, but is accepted as a means of payment by natural or legal persons and can be transferred, stored or traded electronically."

From this we can see that Bitcoin is neither a real currency nor a real commodity.

Hinrichs, CEO of international payment application TransferWise, recently bluntly stated that "Bitcoin is dead", and even Mike Hearn, a member of Bitcoin's core development team, believes that "Bitcoin has failed."

In an interview with the media, Hearn said: "Now no one uses Bitcoin, there are no transactions, and the entire system is on the brink of technological collapse." Strictly speaking, Hearn meant that apart from illegal transactions such as pornography, gambling, drugs, money laundering, and the buying and selling of Bitcoin itself, few people really use Bitcoin... As early as December 2013 , China issued the "Notice on Preventing Bitcoin Risks", pointing out that Bitcoin is a specific virtual commodity that does not have the same legal status as currency, and cannot and should not be circulated and used as currency in the market.

Bitcoin trading is a commodity trading behavior on the Internet. Ordinary people have the freedom to participate under the premise of bearing their own risks. However, from the fact that 80% of Bitcoin is concentrated in the hands of big players who entered the industry early, and only a small part is in the hands of retail investors, it can be concluded that this is a completely shallow, non-circulating closed market. It is not difficult for anyone with a discerning eye to see how narrow this trading market is.

According to market analysts, the renewed "madness" of Bitcoin this time is related to the recent expectation of the Fed's interest rate hike, which will lead to a stronger US dollar index and pressure on the RMB exchange rate. As a result, the expectation of RMB depreciation has stimulated a surge in demand for Bitcoin among Chinese investors, and the huge amount of personal deposits from China are looking for new investment destinations, and Bitcoin may be one of the alternatives.

At this point, I saw that Bitcoin has fallen again, and has fallen back to nearly half of its previous rise. It is really ups and downs! In view of this, I once again advise ordinary people to stay away from Bitcoin!