Right now the cryptocurrency world is excited on how this will change the world and how this will replace various currencies around the globe. Hold onto your horses, this ain't gonna happen in its current form. Why you may ask?
First, these currencies need to be created. Someone is creating these currencies, whether it is computer algorithms, or thin air (like FED creates USD) or some other mechanism but they need to be created. I know, I know, folks will immediately jump and say "well, we are creating them as we are mining them". And here lies the rub. If you are mining them then they are already created. It is like mining gold, which already exists - you are not creating gold.
Second, as I write this blog there exists 829 cryptocurrencies. Top 30 (in order of their market capitalization) are shown below. There are around 220 countries, so even if each country adopts a unique crypto there will still be consolidation and about two thirds of these cryptocurrencies will be gone. And there lies the rub. These currencies can be wiped out along with all your investment (time and money).
Third, the value of this currency is determined by what was the last trading price. So if you look at bitcoin with largest market cap of around $30 billion, the entire bitcoin can be bought by banking cartel and can be wiped out with a single transaction should they ever become a threat. After all, we spend trillions of dollars to maintain supremacy of dollar, so $30 billion really is pocket change for them.
Fourth, while many of these cryptos have a strong blockchain technology the crypto wallets are totally hackable. You can argue that you can print your wallet but in that scenario how do you transact if other party also doesn't believe in storing it electronically (whether offline or online). Secondary issue here is that by not having the crypto wallet in electronic form, you are essentially agreeing that the security of this inherently flawed :-)
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