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cryptocurrency
if you've been online for any amount of
time in the past few years you've heard
a thing or two about this thing
decentralized digital currency
decentralized means it's not regulated
or validated through a governing body or
bank and digital means yeah but the one
argument i see most often in defense of
it the core argument for why
cryptocurrency really matters just never
made any sense to me it's the idea that
crypto will one day replace
government-backed fiat currency we'll
stop using this and we'll start using
this to trade and engage in commerce and
the the us dollar will just be thrown
out who cares anymore so the first thing
you'll hear in this argument is that
real money isn't real it's fake it's
backed by nothing once we left the gold
standard money is just a fictitious
number given to work the only reason
that a dollar is worth a dollar is
because the government said so and
businesses use that to manipulate the
stuffs in the case of a digital asset
ones whose value is derived from the
people themselves rather than a large
governing shady institution it can have
more validity than this money isn't fake
just because it's not based on gold
doesn't mean it's not based on something
now any currency
since we left the bartering system has
to be based on
work work is a measure of time plus
effort generally in regards to producing
a good or providing a service granted a
lot of money is earned by individuals
who aren't providing that time or effort
but the money's innate value is still
derivative of that the work element is
important but the reason we even
associate work with these pieces of
paper is also important this is backed
by a government who does have tangible
means to well back it up let's take
the united states of america because of
of course that's what i'm gonna bring up
the dollar while it doesn't equate to a
specific amount of gold anymore still
does have some correlation to a real
world value you could argue that the
dollar is a fractional representation of
the total united states gdp the value of
all services and goods provided within
and by the country when viewed
individually it has no value but within
the context of that group it does on the
other hand cryptocurrency's value is
derived from
nothing it's unlocked through
meaningless computations that don't have
any correlation with work or any basis
beyond creating
cryptocurrency i know the argument is
that well we give it value we decide the
people for a while it was believed that
instability in the government or
especially inflation would correlate
with a higher price in cryptocurrencies
people would want to transition their
assets into something that would be
fundamentally uh
not tied to this and i'll admit for a
while i believed crypto would have
dysfunction but uh
no inflation rates are still really high
and crypto is just yeah many have said
once cryptocurrency stabilizes then it
can be used as a proper means of
transactions like it won't be jumping
around this much but that may never
happen see it would require that the
equivalent of trillions of us dollars
were being spent by people
using just a single cryptocurrency on
actual goods not speculative markets and
that can't happen you know unless it's
already stable because businesses won't
accept a speculative coin it won't be
used for trading because it's not stable
and it won't be stable because it's not
used for trading it's a catch-22
companies that have vested interest in
these coins will allow users even today
to buy stuff with them because they
expect it could increase in value and
then they can sell it for real money
these specific use cases is more about
taking advantage of the situation than
actually making this a new currency you
know some argue the decentralized nature
of crypto means it's no longer
susceptible to manipulation like
government-backed fiat currency but you
know
it still is even more so because no
regulations exist some entities do have
more control over this market than just
the people in early march 2020 it seemed
possible bitcoin could hit zero and it
may have but major trading sites stop
transactions at a rather convenient time
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a lot of problems are just because it is
a decentralized currency okay so uh
here's an example remember when ole elon
musk said he would accept bitcoins for
tesla well we know he had a large dash
of bitcoins already after he dropped the
news the value of the coin shoots up he
sells them all and then announces they
won't accept bitcoin anymore the price
falls he buys back in and remember when
he said dogecoin was great
and it shot up in value well dogecoin
isn't even a real cryptocurrency i mean
it's a joke based off real
cryptocurrency it can be infinitely
reproduced so it has actually no value
but if people buy it up faster than its
mind then its value increases elon musk
knows this so he bought a lot of
dogecoin values goes up and then sell
repeat the cycle and make profit now if
these were stocks this would be
incredibly illegal and get musk in deep
with the sec but coins aren't
protected again they're decentralized so
market manipulation is super easy and
that's what happened since i know people
will mention this in the comments i will
talk about what if the united states and
all governments collapsed due to some
horrific apocalyptic situation in this
scenario crypto would be ideal right
well if society did collapse in this
function uh it'd be pretty unlikely that
internet and electricity services are
still running or reliable i mean even in
the case of a mass blackout having a
fully digital currency with no real
world backing does sound like a bad idea
if hyperinflation were to take place
yeah it's a great idea to transfer your
money into that crypto but then trade it
back to a government-backed stable
currency i know crypto has made a lot of
people a lot of money i used to trade it
quite a bit but i don't have any grand
illusions about this stuff nowadays it
just
it's getting gross with all the crypto
bros and the ads people might tell you
this is disruptive tech but that's
exactly what people that want to make
money will say about something it's not
that all of this needs to be used in a
awful way but more often than not it is
a speculative market requires that more
people get involved in any normal
business opportunity you're not going to
have random people screaming at you
about how great this is they want you to
be the one that puts money in and loses
it when it all comes crashing down the
utopian ideals of this stuff it's not
realistic it's based on a fallacy a
common misconception about the nature of
money it's all about speculation it's
about making money without really making
anything
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so
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you