It was 2017 when cyber security expert John McAfee proclaimed that a single bitcoin would be worth $1 million by the end of the decade. His claim was seen as a wild fantasy at the time, with Bitcoin being worth only about $5,000 when he made the prediction. Since then, a small number of other notables have jumped on the $1 million band wagon.

That kind of price sounds pretty inviting, doesn't it? But even as Bitcoin hovers around $5,200, it would have to increase 20,000% between now and the end of 2020 to realize McAfee's prediction. The vast majority of crypto investors do not see that as being even a remote possibility. McAfee claims his prediction is based on math. His critics say his math is flawed.

So who's right? It's impossible to say until we reach the end of 2020. But the big money is on those who don't put any stock in McAfee's prediction. The critics rightly point to market forces and the history of investing to bolster their position that a $1 million bitcoin is highly unlikely in just over a year-and-a-half.

Assuming the critics are right, one has to ask why a small group of investors would make such bold claims about any kind of investment. The answer is as obvious as the nose on your face - if you know anything about investing. It's called pump and dump.

Pump and dump explained

Pump and dump is an investment strategy that existed long before there was cryptocurrency. It has been around for as long as stock exchanges have been trading securities. Moreover, it is a strategy that has made a lot of people a lot of money.

The strategy begins with choosing a particular asset that is currently not worth a lot of money. You buy as much as you can without raising alarms from people who pay attention to such things. Then you begin a campaign of aggressively promoting that asset to other investors. With any luck, you will be joined by a small handful of like-minded investors who will help you pump up the excitement.

Your goal here is to encourage people to start buying the asset in large volumes. You want a lot of people buying the asset all at once because that drives the price higher. You keep on pumping until the asset's price reaches a point where you think it is no longer sustainable. Then you sell.

By the way, that's the dump portion of the program. You make a lot of money by selling while the people you convinced to buy are left to deal with the losses of a plunging price.

It's already happening in crypto

We are not saying that John McAfee and those who agree with him are guilty employing a pump and dump strategy. We have no way of knowing what their motivations are. But we also know that pump and dump is already being perpetrated in the cryptocurrency arena.

Just look back on the last couple of years of cryptocurrency news and you will read plenty of stories of ICOs being shut down for employing pump and dump. In fact, new ICOs are finding it more difficult than ever before to arrange financing because so many investors have been burned by pump and dump. Those investors are no longer willing to invest any more cash in ICOs.

If you have been paying attention to the crypto news lately, you also know that numerous exchanges were recently exposed for artificially manipulating trade volumes. Such artificial manipulation is nothing more than pump and dump with a different name. It is essentially the same practice but worked from a different angle.

The nature of crypto doesn't matter

One of the arguments used against people who say Bitcoin will never reach $1 million relies on comparing the nature of cryptocurrencies to that of more traditional securities. McAfee himself has stated many times that Bitcoin is not a stock. And because it is not a stock, he says you cannot apply the same "stock paradigms or formulas" to predict where Bitcoin will go.

While it is true that Bitcoin is very different from a stock in its nature, McAfee's argument doesn't hold water. As an investment, the coin is a store of value the same way a share of Amazon stock is. It is only worth what people are willing to pay for it. There is no different formula or paradigm you can apply to Bitcoin that makes it any different from a stock.

Does it matter that Bitcoin is decentralized? No. Decentralization has absolutely no bearing on the cost of a single coin. Does it matter that Bitcoin is traded via centralized and decentralized exchanges? Once again, no. Trading is trading whether it takes place on a cryptocurrency exchange or a stock exchange.

We could go on and on in explaining how the nature of cryptocurrency doesn't matter here. The bottom line is that there is nothing inherent to Bitcoin that provides ample reason to believe its price will shoot up 20,000% in just over 18 months.

Now, that is not to say it cannot happen. It can. But if it does happen, the most likely cause will be an unrealistically bullish outlook. And such an outlook could easily be created through an aggressive pump and dump strategy. That is the part that worries so many crypto investors.

Why pump and dump is bad

We have discussed why pump and dump is bad for crypto in other blog posts, but it bears repeating. For starters, engaging in pump and dump is illegal in most parts of the world. It is considered artificial market manipulation worthy of prosecution because it harms innocent investors.

If there is anything to remember about pump and dump it is this: every dollar or coin one person makes through pump and dump is a dollar or coin lost by another investor. That's why the strategy requires aggressively promoting the asset in order to cause other people to buy it. Any money pump and dump investors earn comes directly out of the pockets of those they convinced to buy.

Aside from being illegal and immoral, pump and dump is also bad from an economic standpoint. Any artificial manipulation of the market is. The key to this point is remembering that assets like Bitcoin are controlled mainly by supply and demand.

Bitcoin has no intrinsic value on its own. If there hadn't a sudden rush to buy bitcoins in 2017, the price never would have ballooned to nearly $20,000. And remember that once people began selling off their coins, the price plummeted considerably. You know the drill; we don't have to explain it to you.

The problem with pump and dump is that it artificially inflates the value of the asset in question. This is especially problematic in cryptocurrency because said assets do not have any intrinsic value. Artificially inflating the price of Bitcoin only leads to a more dramatic price drop once the bottom falls out. That means more people are harmed in the end.

Maintain a proper perspective

Most regular readers of the Coinbet.com website are people who like to gamble online. Their experiences with Bitcoin and other cryptocurrencies is typically limited to buying digital coins so they can play slots and other casino games online. We are fine with that. Our advice to those readers is to maintain a proper perspective of cryptocurrency.

For you, cryptocurrency is a monetary system rather than an investment. That's great. Did you know that Bitcoin was originally created for that very purpose? Indeed, Satoshi (the person who created Bitcoin) never intended his creation to become an investment asset. He wanted it to be an alternative monetary system that enabled people to transact business online in a safe, secure, and decentralized environment.

Whether or not Bitcoin ever reaches the $1 million mark isn't likely to matter to you as an online gambler. You don't think of it in those terms. If it does jump 20,000% between now and the end of 2020, any bitcoin you own will be worth more. That's great. But if it doesn't climb that high, no worries. You can still purchase whatever amount of BTC you can afford and still enjoy a good game the slots.

Not enough active users

In closing, we want to refer you to a great article published on the CCN website recently. It deals with the $1 million prediction in detail. The post closes with some raw facts that do not make for good news if you are expecting McAfee's prediction to come true.

The article cites sources that say the current number of active Bitcoin users now stands at about 7 million. That may sound like a lot, but it is not enough to push Bitcoin to $1 million. If the $1 million mark is going to be reached, billions of people will have to start buying and selling crypto in the next 18+ months. That seems highly unlikely.

There are only two ways to get that many people involved in Bitcoin that quickly. The first is to get so many merchants to adopt Bitcoin payments that consumers have no choice but to get on board. The other option is pump and dump. If Bitcoin does reach $1 million at the end of 2020, which strategy do you think will have been responsible for it?