February 25, 2021

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JP Morgan Values Bitcoin By Cost of Production? Wall Street Has No Idea What This Stuff Is Featured

People have been asking me, "How did you manage to score such a monumental crypto patent before all of these billion and  trillion dollar companies?". The answer is actually quite simple. I understood what crypto and blockchain were, early on.

These videos were all made in the first week of 2014 - over 7 years ago - before the birth of Ethereum!

Foresight and understanding enabled me to see what many others couldn't or didn't. That was back in 2013. Fast forward to 2021, and some of the biggest names on Wall Street still don't have a clue. This means that I still have a distinct advantage!

Reuters reports: Bitcoin is 'economic side show' and poor hedge against stocks: JP Morga

For one, you know there's a problem if someone is trying to value a paradigm shifting, inter-industry protocol by using its "production costs"! 

It shows a blatant misunderstanding of how platform-based, paradigm shifts behave - or even of what they are.

Let's take a look at using that logic as applied to the last protocol-based paradigm shift.

What is the "production cost" of the Internet? We can back into that by quantifying the complete operating costs of those entities that actually supply the Internet.

  1. The Blended Telecomm net profit margin is 8%
  2. Global broadband revenues are $395B (alternative source).
  3. Thus, rough, all-in cost of production is about $363B ((199% - 8%) * $395B).

This is the Internet Protocol's applied production cost (the cost to actually use the value of the protocol in real life) - $395B.

Now, how much is the Internet worth? A common sense view...

At a glance

  • The value of the internet is difficult to assess, but economists believe its services are worth much more than the cost of internet subscriptions.
  • It presents a significant consumer surplus, which is the gap between how much something is worth to us and how much we pay for it.
  • Deeply ingrained in society, it is almost impossible to put a monetary value on the internet.

The internet became a global commercial network in the 1990s. Less than three decades later, it is everywhere. Now that we’ve created it and come to rely on it, we inevitably wonder: what is it worth?

Well some studies say in excess of $10 trillion, others $7.8 trillion - all account for.... just the US! As the US is roughly 20% of global GDP, multiply that by 5, and.... you will find that $40 to $50 trillion is a lot more than the cost of production at $395 billion. But wait...

As excerpted from "How Much is the Internet Worth?"

... Most recently, yet more economists – this time Erik Brynjolfsson, Avanish Collis and Felix Eggers – tried yet another tack: in 2017, they asked people already on the internet whether they would give up a particular internet service in return for money.

On average, respondents said they would forgo services such as search engines for US$17,530, email for US$8414 and maps for US$3648.

This study tells us a lot about what people value most about the internet. It also gives us a figure for internet consumer surplus across the US: almost US$8 trillion a year in an economy with a US$20.5 trillion economy.

Source: Internet Association data from BEA.

Source: Internet Association data from BEA.

 Indeed, a real-world example now shows what happens when you remove internet access. India’s government turned off internet access in Muslim majority Kashmir in August 2019 in a bid to reduce public protest. The effect even in this poor region was immediate: pharmacies quickly began to run out of medicine; students could not study; news about the region dried up, even within the region itself. The New York Times quoted one local as saying: “There is no life without internet, even in Kashmir.”

At this point, Greenstein says, valuing the internet is a task for which economics lacks the tools.

“It’s no longer a partial equilibrium,” he explains. Or in plainer English: “It’s not a well-grounded question anymore.”

The internet, it seems, is now too deeply ingrained in our society to be assessed with mere money.

Why am I comparing the Internet to Bitcoin? Because I truly understand what Bitcoin, distributed ledger protocols, and the crypto industry are really about. It's the underpinnings of a global value transfer network that has the real potential to easily dwarf the Internet Very much like the Internet exists as the result of its underpinnings in information transfer protocols (IP, or Internet protocol), it is a utility with unprecedented global reach and ability.

It is not a commodity, nor an investment or a security. It is much too monumental to be measured in mere materialistic, one-dimensional Wall Street parlance. Big banks, regulators, investors, the media - many have this all wrong. This is how I was able to score the patent. I knew what it was that I was patenting., while nearly everyone else was looking at price charts and thinking money remittances. Granted, that was almost 8 years ago. Fast forward to today, have the big investment houses learned their lesson?

The Ultimate Flip Flop: JP Morgan Validates Cryptocurrency

www.linkedin.com › i-told-you-jp-morgan-phil-nagy
 
Feb 21, 2019 — I hate to say, “I told you so”, but JP Morgan…I told you so. They just announced that they're creating their own cryptocurrency to use in house ...

JP Morgan Continues Crypto Flip-flop Amidst Square's $50M ...

coincrunch.in › 2020/10/16 › jp-morgan-continues-cry...
 
Oct 16, 2020 — The latest statement by JP Morgan on the price of Bitcoin has left multiple in dilemma. But is this something to worry about?

JPMorgan Completes Surprise Bitcoin Flip—And Calls A Price ...

www.forbes.com › sites › billybambrough › 2020/06/13
 
Jun 13, 2020 — JPMorgan, one of Wall Street's biggest banks and up until recently an outspoken bitcoin critic, has changed its tune on the world's number one ...
Missing: flipflop ‎| Must include: flipflop

JPMorgan Flip-Flops Again, Says Bitcoin May Hit ... - LaptrinhX

laptrinhx.com › jpmorgan-flip-flops-again-says-bitcoin...
 
Jan 5, 2021 — Back at the start of November, JPMorgan quant NIck Panigirtzoglou - perhaps tasked with being the skeptic in-house bitcoin strategist ...

zerohedge على تويتر: "JPMorgan Flip-Flops Again, Says ...

twitter.com › zerohedge › status
 
Jan 4, 2021 — JPMorgan Flip-Flops Again, Says Bitcoin May Hit $100,000 "But Such Price Levels Would Be Unsustainable" ...

Bitcoin May Never Go Above $ 40,000 Again, JP Morgan ...

www.reddit.com › CryptoCurrency › comments › bitco...
 
Jan 27, 2021 — 1.7m members in the CryptoCurrency community. The official source for CryptoCurrency News, Discussion & Analysis.

 

JPMorgan Flip-Flops Again, Says Bitcoin May Hit $100,000 ...

remarkboard.com › jpmorgan-flip-flops-again-says-bitc...
Back at the start of November, JPMorgan quant NIck Panigirtzoglou - perhaps tasked with being the skeptic in-house bitcoin strategist - predicted that based on ...

 

In the meantime, JP Morgan advisory customers, with friends like these, who needs enemies???.

  

Now, I'm not a Bitcoin maximalist, nor do I even think that Bitcoin is the most valuable crypto, but that doesn't mean that I will just sit back and ignore the spread of misinformation! If you want to know what I'm into, then just Imagine having the keys to the internet back in 1995. Well, that's where I feel we are in 2021, with the same Luddite movement acting the role o f the naysayer! For my take, read "A Most Powerful Invention Comes to Life"

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Last modified on Friday, 19 February 2021 20:01
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