Banks and old fuddy duddies are increasingly vocal about their doubts over the practicality of cryptocurrency.
“It’s fluff!” “It’s not real!” “It’s a bubble!” “It has no real world application.” “It’s not safe.”
All these talks of FUD (Fear, Uncertainty and Doubt) going around are not without its merit.
How do you value something that is basically churned out of just computers crunching numbers and wasting electricity? Bitcoin has a finite supply which makes it valuable, but on that same vein, we also now see that it’s just as possible to duplicate money with a declaration of a fork. Some merchants are accepting Bitcoin transactions, but the numbers are probably still lesser than the money-for-gold market in the Warcraft computer game community. So it’s not surprising to see why so many folks from the older generation are not really embracing cryptocurrencies. The recent spat of hacking and malware news aren’t really making it easy for the industry to stand tall as a credible and safe alternative to fiat currencies either.
Perhaps the biggest mistake that the older generation can make about innovation is in trying to make sense of it. The young people don’t have that problem. They grew up in a generation that pays real money for digital goods in games. Young people throw money around in support of products and ideas that they like on Kickstarter and Indiegogo, and sometimes these products never even see the light of day. We get apps like BigO turning unknowns into overnight minor celebrities and getting paid just by doing god-the-phark-knows-what it is that they do on BigO. A friend of mine gets paid in likes and BigO money for streaming herself having lunch. Mind blowing.
Things are already happening around us that don’t make sense. Maybe it’s time we stop trying to hammer our understanding onto cryptocurrency based on old world beliefs.
Francisco Blanch, Head of Global Commodities and Derivatives Research at Bank of America, believes that the only way to legitimize cryptocurrency is to instil legal framework and subjugate it with regulatory guidelines.
A Morgan Stanley analysts’ report, written by James Faucet, and published in June 2017 states that cryptocurrencies are more like “investment vehicles” which are actually more inconvenient to use as a form of payment as compared to credit or debit cards. There are also no clear reasons as to why cryptocurrencies are increasingly becoming popular and are on a massive surge.
But regardless of what I or you or Blanch or Faucet think about the future of cryptocurrency, the fact remains that right now, Bitcoin is averaging daily trades of $1 billion USD according to statistics in recent months. Daily trades sometimes exceeded $2 billion USD. Bitcoin’s volatility has decreased as it builds liquidity and scale, but it’s still not at the banking industry’s comfort level.
A lady I met on a cryptocurrency chat group who lives in Angola, South Africa, says that cryptocurrency was the only way that she and her people are able to circumvent ridiculous banking laws in their country which, she claims, seek to keep them in perpetual poverty. Countries are also finding it harder to keep their money and citizens in check especially with money moving around the digital sphere so freely. For every good that cryptocurrency brings to the table, there are also the darker side of the internet that proliferates from this. Countries and regulatory bodies are right in feeling like they got their testicles caught in a bear trap.
However, for the most parts, I feel that FUDers, and even the reputable economist and financial analyst, Peter Schiff, just don’t understand human behaviour and collective social mindset. Full recognition of the ideology and technology behind cryptocurrencies is essential when it comes to analysing this growing trend.It almost feels like if something seems too way out of our realm of understanding, we just brush it off as rubbish. Unless of course, they actually do understand the power of cryptocurrency and realised it to be a threat to their existence and the prevailing print-on-demand monetary system. That would make the most sense as to why thy try so hard to use whatever vestige of their authority to shut down cryptocurrency.
So should we be worried about that? Well, here’s the good news: The only way they can shut down cryptocurrency is to shut down the internet. Now, that’s not going to happen is it?
Welcome to the next level of industrial revolution, suckers.