Is Bitcoin a pie or a trap?

In recent years, Bitcoin, as a digital currency, has caused waves in the global financial market. Its drastic price fluctuations have attracted the attention of countless investors and sparked widespread controversy from all walks of life. Some people see it as a "pie" for acquiring huge wealth, but after delving into its underlying logic and potential connection with the US dollar, we will find that Bitcoin is more like a thorny "trap" with huge risks hidden.

1、 Potential correlation and background between Bitcoin and the US dollar

At the beginning of Bitcoin's birth, under the banner of decentralization and anonymity, it seemed to be an innovative product that was detached from the traditional financial system. However, as mentioned, when we focus on the global status of the US dollar and the trust crisis it faces, the emergence and development of Bitcoin seem to have a different meaning. As the most important reserve currency in the world, the US dollar has long dominated many fields such as international trade and financial transactions. However, with the rising scale of US debt, fiscal deficits and other issues have become increasingly prominent, and the credit foundation of the US dollar has begun to shake. In this context, the emergence of Bitcoin makes it difficult not to doubt whether it is a "chess piece" quietly laid out by Eagle Sauce (the United States) to cope with the possible greater crisis of the US dollar in the future.

2、 The appearance of Bitcoin as a 'pie'

For some people, Bitcoin does have a tempting side like a pie.

From the perspective of investment returns, the myth of Bitcoin's price increase is astonishing. Many early participants in Bitcoin investment have achieved returns of hundreds or thousands of times. For example, someone once spent very little money to purchase a large amount of Bitcoin, sold it during its skyrocketing price, and instantly achieved a huge accumulation of wealth, transforming from an unknown person into a millionaire or even a billionaire. This wealth effect has attracted countless people who aspire to quickly achieve financial freedom to flock to the Bitcoin investment market. In their eyes, Bitcoin is a "golden pie" that can easily change their destiny.

In addition, the blockchain technology on which Bitcoin relies has many innovative aspects. The decentralization and distributed ledger characteristics of blockchain theoretically make transactions more transparent, efficient, and do not rely on traditional financial intermediaries. This to some extent aligns with people's demand for de authority and increased autonomy in financial transactions, as if foreshadowing a promising direction for future changes in the financial field. It also makes many people look forward to Bitcoin as a powerful tool for promoting financial progress and a "technological pie" worth exploring in depth.

3、 The huge risk hidden behind Bitcoin is essentially a 'trap'

Firstly, the price fluctuations of Bitcoin can be described as insane. It lacks a stable value foundation like traditional currencies, and its price is entirely dependent on market supply and demand as well as investor sentiment. In the past few years, the price of Bitcoin has experienced multiple rollercoaster like fluctuations, which may skyrocket several times in a short period of time, and then plummet without warning, often reaching a drop of tens of percent or even more. Such extreme price fluctuations mean that investors face enormous uncertainty, and may be immersed in the joy of asset appreciation one moment, but lose everything the next. Ordinary investors who enter the market with a speculative mindset often find it difficult to withstand such risk shocks and ultimately become victims of this financial game.

Secondly, there is a significant gap in the regulation of Bitcoin. Due to its birth in the virtual network world and its anonymity, it provides a breeding ground for illegal activities such as money laundering and illegal transactions. Many criminals use Bitcoin for cross-border illegal fund transfers, evading the pursuit of regulatory authorities and seriously disrupting normal financial order and social stability. Moreover, regulatory policies for Bitcoin vary globally, with some countries recognizing its legitimacy while others strongly resist it. This chaotic regulatory situation further exacerbates the risks of Bitcoin, making it difficult for investors to accurately determine its future direction and ensure its legitimacy.

Overall, although Bitcoin has some attractive features on the surface, giving people the illusion of a "pie", when we break through the layers of fog and deeply analyze the economic logic, regulatory status, energy consumption, and currency attributes behind it, we will clearly see the huge risks it carries, more like a carefully disguised "trap".