Why Cryptocurrency Is A Giant Fraud
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Let’s start with the basic promise, that of being “decentralized, safe, and anonymous.” People like the word decentralized. I like it a lot myself. Nobody likes centralized authority. You know who liked things centralized? Stalin. But what does the word actually mean? In this instance, it means that financial transactions are peer to peer, rather than going through your bank or a processor like PayPal, and that there is no central bank altering the money supply, as there is with the U.S. dollar. Many of the pitches for Bitcoin begin by emphasizing its decentralized nature.
In fact, when we examine whether Bitcoin can function usefully as an alternative currency for the average person, we see that all of the grand claims for it fail entirely. Using it does not create greater security or safety for one’s finances. It does not free one from the oversight of the government. It is not convenient or free. Its volatility makes it functionally useless as a currency. Furthermore, these drawbacks are not fixable; they are products of the very concept itself. There is a reason that you are not using Bitcoin for transactions, even though it has been around since 2008. It is that while Bitcoin is based on an interesting technological innovation (blockchain), it is not a good idea for an alternate money system, due to its dependence on several libertarian illusions.
The European Business Review cites “easy transactions” as a key draw for cryptocurrency. Perhaps, though not really easier than existing payment processors that do not require you to convert your money into an arcane new currency and back again to use it. But importantly, cryptocurrency also offers new and scary ways that you can actually lose all of your money, which should certainly factor into an assessment of how convenient it is. A Wall Street Journal analysis in 2018 found that 20 percent of all Bitcoin tokens were lost and probably unrecoverable, because if you lose your PIN for your Bitcoin wallet, you can never access it again. “Unlike an ATM PIN, this password can’t be recovered easily, since there is no bank to retrieve it,” says the Journal. Investopedia says that “the reason for this has to do with the structure of cryptocurrencies and the emphasis they place on privacy and security.” One guy who had $220 million in Bitcoin, because he bought early and the value exploded, had no way to access it because he had lost his PIN.
Many of the supposed advantages of Bitcoin, then, are actually disadvantages. Having a fixed money supply with no central bank means there is no regulator who can help stabilize the value of the money. As I was writing this article, the value of Bitcoin plummeted 10 percent in 24 hours. If the U.S. dollar lost 10 percent of its value in a single day, people would be comparing this country to Zimbabwe. Yet Bitcoin is intended to be better than fiat currency! The biggest illusion at the heart of the crypto-fraud is that markets can be self-regulating and stable. In fact, markets are created by states and societies, exist within frameworks of law, and must be tended, fed, and cared for by governments if they are to function. Bitcoin pretends to shed the very feature that makes money work—adapting to and conforming social and political institutions and rules. Instead, it relegates its own political judgments to a rigid algorithm, which makes it both unable to respond to the changing world and completely outside the control of the society that must accept and use it.
Jesus: Hey, Dad? God: Yes, Son? Jesus: Western civilization followed me home. Can I keep it? God: Certainly not! And put it down this minute--you don't know where it's been! Tom Robbins in Another Roadside Attraction
May 23, 2021 at 12:17 PM #425064Ohio BarbarianModerator
- Total Posts: 21,767
I do think it must be seen as a potential threat by the established financial elites because most of them hate it so, but that’s not enough to convince me to invest my meager savings in it.
It is better to vote for what you want and not get it than to vote for what you don't want and get it.--Eugene Debs
You can jail a revolutionary, but you can't jail the revolution.--Fred Hampton
May 23, 2021 at 4:41 PM #425081So Far From HeavenKeymaster
- Total Posts: 9,132
that doesn’t share all of these traits.
The US dollar is only worth a plug nickel because WE say it is. There is zero real value to the dollar.
Since virtually every other currency bases it’s value on the buck, they are TWICE removed from reality.
Give me a currency you can use in your local grocery store that isn’t so.
May 23, 2021 at 5:00 PM #425083
May 23, 2021 at 5:23 PM #425084Mr. Mickeys MomModerator
- Total Posts: 6,204
Hell, no... I'm not giving up...
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