Hi Steemit.
In this post I wanted to talk about all of this anti cryptocurrency and anti Bitcoin FUD that is making the rounds all over the place. (I link out to other online articles, some of which are my own and contain ads and/or affiliate links within. I use that to offset costs associated with web hosting and equipment. I am giving respect to the Steemit community by divulging this in an open fashion.)
I have read this stuff everywhere from big news outlet articles, to Facebook comments on crypto posts, to the comment section of Slashdot.
It seems that there are a LOT of people who are not only buying into the charges of Bitcoin and crypto being some sort of ponzi scheme, but they are woefully uninformed about the subject in general.
I am going to tackle some obvious charges as follows. Of course it's probably not an exhaustive expose, which you can find plenty online, but it's my minor contribution to the defense of crypto, which I like to make from time to time.
If you allow the FUD to drown out the truth, then the FUD becomes the defacto truth.
We can't let that happen.
"Crypto is a Ponzi and a Tulip Bubble!"
These are the most frequent charges made about Bitcoin and cryptocurrency by the establishment.
They are genuinely worried about us little people, and how we can be harmed by this volatility and "irrational exuberance".
The basic definition for a ponzi is that funds coming in from new investors is used to pay the earlier in investors, and as the number of people coming in outnumber the ones being paid, everything is great, but as the number coming in fizzles out, there isn't any money left to pay who remains and the whole thing collapses under its own weight.
Does crypto really work this way?
Last I checked, the demand for these assets is climbing at an astronomical rate, and earlier holders aren't "giving up" their holdings to be paid off in fiat cash, so this doesn't really apply.
This article not only explains this easy concept, but it also questions the very charges made frequently, by none other than former central banker billionaire Jamie Dimon, that Bitcoin is also some neo tulip mania.
Alan Greenspan, another former central banker and former chairman of the U.S. Federal Reserve, has even gone so far as to compare Bitcoin to American Revolutionary War fiat money (of all things), which is so much of an unreasonable stretch that I question his rationality and have started to think that he's entering an age related dementia stage.
The sheer hypocrisy of people like Jamie Dimon on this subject is also unnerving, since on the one hand he is crying tulip bubble for the currencies, but on the other hand the financial institutions are buying into the blockchain and delving into Bitcoin futures trading. I guess that profit trumps ideology. Every. Time.
I remember, way back when Alan Greenspan was the Fed Chairman, and he was headed over to the US Congress to answer questions about the economy, and this guy would have to parse every word so as to not cause a fear or panic in the financial markets.
Can you imagine THAT kind of power?
It was so disgustingly funny that the CNBC news people made a joke where they showed him walking over from the Federal Reserve to the Capitol and he had a folder or a briefcase or something on him and they used the computer drawing screen to make marks on his packet saying what it could be and what it meant for our financial well being.
THAT is what we should be worried about, NOT Bitcoin.
Thank goodness for the likes of John McAfee and Michael Novogratz, who are bringing a certain level of sanity and reality back into this discussion by stating that cryptocurrency is not created with nothing (mining and mining equipment requires investment and power, which both require investment) and actually shares more in common with commodities like gold than with fiat currencies, which are actually the real ponzi schemes and faith con games. There is real scarcity built into Bitcoin, and while the number of cryptos is used to bolster the other side, which claims that scarcity is diluted by the alts, not all alts are created equal and values are not all the same. They forget to factor use cases into this equation.
I myself have been caught up in internet ponzi type hyip schemes, many of which work well for a time and then fizzle out in perfect ponzi fashion, and you know what? If you know what you are getting into you can use that to your advantage to fund a venture, but of course for those who don't know it can be harmful. This experience, however, is not the same kind as with dealing in cryptocurrency.
Cryptocurrency is a software based "commodity-like" currency, in my experience.
The get rich quick part pertains to the speculation and trading part, which due to supply and demand and some other factors has resulted in wild upswings in value that can create returns within hours that could take years with ordinary financial investments. People love this. What again is wrong with this? Aren't we all grownups and playing with our own money? If you aren't a capable adult and you need government protection, then maybe you should be in another game?
Of course there should be oversight for true fraud, but government to alleviate risk by making it so that profit is kept to a minimum so that only the largest money players can turn a profit? We have NASDAQ, AMEX, and the NYSE for that!
May I submit an observation at this point?
Our parents and their parents, earlier generations, were used to a much slower pace of life. They were patient, mainly because things just moved slower. I remember there was no direct deposit for paychecks, so my dad would get his paycheck, once a week, on Friday, and then deposit that in the bank, and when it cleared, it cleared.
With television, for example, there was no freedom of choice of thousands of channels, and forget about fantasies of YouTube or Kodi... or PirateBay.
Today's people are IMPATIENT.
A.D.D. is commonplace.
Instant gratification is the order of the day.
Computer speed reigns.
Why NOT have currency that can be transferred within seconds, minus the middlemen, and have some semblence of security or the chance of anonymity built in? Why NOT expect great demand and rapid rise in value for something that people OBVIOUSLY want and think they need?
Who are these self appointed overlords to tell the People what they need?
It's been like that for generations, and the People are tired of that worn out paradigm that doesn't work well in the modern computer age.
I'm not saying that I am 100% correct here, and sure there are always risks inherent in any new idea when put into practice, but let's discuss this and see FUD for what it really is?
IF something is a great enough threat to the status quo, then the guardians of that status quo will fight back in any way they can.
There is no use in regular people coming to their rescue by buying into a fear based reality that is being offered.
Let's also make fair mention of brilliant innovations like embedding other use cases into these blockchains, like smart contracts and other use cases that benefit various industries.
Even the banks are excited about using crypto to transfer funds and save money over using the antiquated SWIFT system, which takes days to transfer money internationally.
I will choose better implementations and optimism every time.
Evolve, or perish.
What do you all think about these matters?