"In plain english that’s the same as throwing cheap dollars at bitcoin, pump it higher (by preventing a dollar squeeze from ever emerging) at the same time as lining up investment funds and passive investors to dump the coins onto later.
If you’re thinking at least with bitcoin there’s no prospect of over-investment leading to the sort of over-production that could stifle the bull case in the long run, you’d be wrong. Every penny diverted from productive investments over to non-productive bitcoin, is a penny diverted from the productive sector to the consumption sector without any compensatory output guaranteed.
When the cost of dollars goes up accordingly to compensate, which it will eventually have to do, the opportunity costs of not being invested in the productive sector will be too great to ignore. Funds will then cash in their bitcoin gains and transfer over. The latter’s gain will be the former’s loss. But unlike the commodity market there won’t be an obvious fundamental floor to stop at on the way down.
If all this, meanwhile, is coupled with a boom in wider cryptocurrency production, the crash might come even quicker." from
Meanwhile Tim Taylor has a long post Blockchain: new frontiers
Check also the old Post from Economist's View
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