Nassim Taleb’s ‘Antifragile’ is the Answer to ‘The Black Swan’ Author Dumping Bitcoin Due to High Volatility
“There is no long-term stability without short-term volatility,” writes Taleb and then dumps Bitcoin due to its high volatility.
Nassim Nicholas Taleb, author of “The Black Swan,” took to Twitter on Friday to share that he has been getting rid of his Bitcoin.
A currency isn’t supposed to be more volatile than what you buy and sell with it, said the former options trader, adding that goods can’t be priced in the cryptocurrency. “In that respect, it’s a failure (at least for now).” Taleb also said in a separate tweet that Bitcoin has failed as a hedge against central bank policies.
“It was taken over by Covid denying sociopaths w/the sophistication of amoebas,” said Taleb, adding that the other problem with the digital currency is that “the appeal of a cryptocurrency depends on some opacity, its ability to facilitate tax fraud and money laundering.”
While one can anonymize a gold coin by re-melting it, the same isn’t possible with Bitcoin, which “is more tractable than cash,” he said.
Bridgewater Associates founder Ray Dalio also said last month that “Bitcoin will unlikely be as private as some people surmise.” While calling the cryptocurrency a “long-duration option on a highly unknown future,” Dalio saw this lack of privacy as a risk as,
“It is, after all, a public ledger and a material amount of Bitcoin is held in a non-private manner. If the government (and perhaps hackers) want to see who has what, I doubt that privacy could be protected.”
Meanwhile, the Bitcoin community is working on a major upgrade to Taproot that will increase privacy on the network. However, for Taleb, the issue is also of volatility as he noted,
“BTC Volatility is not dropping with time/at higher price, exactly what you don't don't need.”
Interestingly, Yassine Elmandjra, a crypto asset analyst at Ark Invest, had the perfect solution for Taleb: read Antifragile by Nassim Nicholas Taleb, which says,
“There is no long-term stability without short-term volatility.”
Naval Ravikant, the founder of AngelList and a crypto proponent, also suggested Taleb reconsider by classifying Bitcoin as “an out-of-the-money call option on becoming hard-to-seize digital gold. As such, it will remain extremely volatile for a long time.”
Crypto Twitter (CT) was also quick to chime in and point out how Bitcoin is not a currency, and that volatility is not inherent rather the result of the market being nascent. Qiao Wang of DeFi Alliance said,
“If you bootstrap a new currency or any other type of asset and let the market do its thing, volatility is a certainty until real mainstream adoption. In fact, the only certainty.”