I think this actually overstates the value of cryptocurrencies. The value of say, Bitcoin, isn't even connected to its value as a method of money laundering or extortion through ransomware. However morally objectionable these are, they do have economic value - it's just that value is not connected to the price of any cryptocurrency.
Rather, the whole thing is an extended, worldwide pump-and-dump; speculation is driving all movement.
To me, it's really sad, because Bitcoin (and some of its descendants) are intellectually fascinating. With simple building blocks that had been around for decades (hashing + public keys) someone made something profoundly new. It's in some ways inspiring, since it makes me feel there must be so much more out there to discover and build. It's also sad, because it shows how things you build can 'grow up' and become a little unrecognizable.
It’s the combination of strong network effects and artificial scarcity driving the price action. You buy Bitcoin cause something about it really resonated with you. Price goes up and you feel validated. You go and naturally — out of benevolent intentions — tell your closes people so they don’t miss out.
The mistake of cryptocurrency is discounting the potential for price manipulation. Earl adopters understood cornered these markets immediately. Now we are in never ending cycles of hype, markup, dump, accumulate, hype, markup, distribute, and accumulate over years. These cycles are continuously producing winners and losers and the losers are generally those who have more to lose and are thus enable to withstand the intense pressure of bear markets.
I love Bitcoin and Ethereum and all the potential freedom that they represent. At the same time - enough. These markets need regulation. We need to know who owns these coins. We need to see their selling patterns so we can see their manipulation.
Unfortunately, the cynic in me knows that too many people are making too much money and are probably going to block regulation for a very long time.
> These cycles are continuously producing winners and losers and the losers are generally those who have more to lose and are thus enable to withstand the intense pressure of bear markets.
This is the opposite of what I think is true so I'd love to see a citation for this claim.
There is no citation but isn’t it obvious what is happening in this unregulated market? What do you think is happening when the price of Bitcoin is driven down 70% plus every so often? Then what do you think happens as it goes sideways for so long?
Maybe I’ve just seen this cycle a few times and this is my cynical take. But I think it just makes sense.
I feel so similarly to you. I got into Bitcoin in 2012 and really believed it had to potential to change the world. I thought titles and title insurance would become a thing of the past; international banking would be revolutionized. Instead we got infighting, forking, crazy high fees, and a speculative asset driven only by new money coming in. The biggest distributed Ponzi scheme ever. And now with the clarity of a decade behind us, I have yet to see any compelling use case for crypto that isn't better served by trusting a central authority or open standards. Even titles need a court system to abitrate conflict, which you can't do with irrevocable transactions. When ETH had a bug in the DAO the community forked the chain to undo the bug, so now we have ETH and ETC, just hilarious.
I saw so much potential, and it's just a shame to see what happened to the community and direction of the technology. The Ponzi Casino is a sad outcome for crypto.
Wow, thank you. Totally agree. So glad you have been able to put this into words what I have been struggling to explain. "Fear of missing out" is a powerful drug.
Rather, the whole thing is an extended, worldwide pump-and-dump; speculation is driving all movement.
To me, it's really sad, because Bitcoin (and some of its descendants) are intellectually fascinating. With simple building blocks that had been around for decades (hashing + public keys) someone made something profoundly new. It's in some ways inspiring, since it makes me feel there must be so much more out there to discover and build. It's also sad, because it shows how things you build can 'grow up' and become a little unrecognizable.