Crypto Currency…surely you would have had to be hiding under a stone not to be aware of Crypto Currency in 2018. 2017 was the year that saw Crypto Currency thrust in to the public limelight with the bitcoin value increasing from £756 to the giddy heights of £15,458 then collapsing to £5000 at today’s rate, it is estimated that this created between 20,000 -200,000 millionaires who achieved this by doing largely nothing. When Bitcoin started in 2009 they could be purchased for less than a penny and were often given away free to sign up to sites, one of the earliest investors bought 5000 bitcoins for £21 which gives a value of less than half a penny per bitcoin. If this person had sold his 5000 bitcoins at their highest value they would have sold for £77,290,000…not bad for a £21 investment, however there was no genius behind this investment, no physical company, no physical assets, nothing…it only had value through “hype” alone.
Looking past the hype of crypto currency I personally cannot help but see a very well-dressed mass scale pyramid scheme, a system that only works by enlisting more and more people to continue the perception they are going to make money…however those later to join find nobody wants it and have lost their money.
True value exists only through the output of time and energy, whether that’s the provision of a service or a physical product the value is based on time invested…for convenience money is utilised as our mechanism of trade. The harsh reality is those who made a fortune with bitcoin did so off the back of everyone else’s hard work and time.
The model that bitcoin created has been duplicated many times with new crypto currencies appearing every day (and as many failing), it is a highly volatile market that is very easily manipulated. There are alarming amounts of scams involving cryptocurrency, a high level of illegal trade due to the untraceable payments, people losing money and a few making a fortune off everyone else’s time and energy. How much of a cryptocurrency is retained by those who start it to then sell up when it reaches a certain value(collapsing that currencies value)?
This of course is purely my perspective on cryptocurrency, one I am sure that some will disagree with. We may at some point see a rise to a digital currency that really works, a solution that fixes the flaws of the current ones and may potentially help address the disparity of the worlds current financial imbalances…until then be extremely wary of cryptocurrency…if the corner shop won’t accept it in trade for a tin of beans then it is worth nothing but hot air.