Bitcoin collectors and crypto-token creators suffer from a number of unsupported beliefs destined to come back and haunt them. The key ones:
That Quantitative Easing was the same as “printing money”. It wasn’t.
That printing money causes hyperinflations. It doesn’t.
That a 21 million limit means anything. It doesn’t.
That blockchain is the future of finance/law/business. It isn’t.
That if blockchain were to become more widespread it would be based on cryptocurrencies as we know them. It wouldn’t.
That blockchain eliminates the need for intermediaries and rules in markets and transactions/contracts. It doesn’t.
That the cryptocurrency/blockchain bubble is like the dot.com bubble. It’s not.
That network effects are enough to sustain the value of a currency. They aren’t.
That a low barrier to entry and endless replicability does not reduce the value of cryptocurrencies to zero. It does.
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The true value of cryptocurrencies is zero, as many are soon enough going to painfully find out. Some more discussion on why here – Of Bitcoins and Balance Sheets: The Real Lesson From Bitcoin
I’ll preface with this with my background…I am a moderate crypto industry investor, tech blogger, stock trader, software consultant, musician, small business owner, and real estate investor. I will respond to each item, inline. I will also use the term decentralized to describe “crypto-currencies” and their supporting databases such as Blockchain or Tangle.
That Quantitative Easing was the same as “printing money”. It wasn’t.
People from all sides think this regardless of their opionion or investment stake in decentralized and distributed database technologies.
That printing money causes hyperinflations. It doesn’t.
Correct, it impacts liquidity.
That a 21 million limit means anything. It doesn’t.
Certain decentralized tokens utilize this number as a fixed asset amount, however those token can be subdivided and forked to create more tokens. It’s really a mute point.
That blockchain is the future of finance/law/business. It isn’t.
The concept of cloud computing and decentralized platforms is the future. Look at the largest tech companies, Google, AWS, Microsoft, IBM…this is the modern tech industry. Decentralized databases that are validated by multiple sources are the only way we can move foward with processing large amount of transactions. Smart contracts streamline this process as well.
That if blockchain were to become more widespread it would be based on cryptocurrencies as we know them. It wouldn’t.
Your statement doesn’t make a lot of sense…perhaps you can clarify this point.
That blockchain eliminates the need for intermediaries and rules in markets and transactions/contracts. It doesn’t.
It never claims to, it just claims that they are not centralized.
That the cryptocurrency/blockchain bubble is like the dot.com bubble. It’s not.
Agreed, it is not.
That network effects are enough to sustain the value of a currency. They aren’t.
Current networks are not and do not claim to be.
That a low barrier to entry and endless replicability does not reduce the value of cryptocurrencies to zero. It does.
Security tokens and purpose built tokens are essentially share of stock for companies which are not traded on other stock exchanges. They are not money and people who trade them do not consider them money, only people outside of this industry call them currencies.
The true value of cryptocurrencies is zero, as many are soon enough going to painfully find out. Some more discussion on why here – Of Bitcoins and Balance Sheets: The Real Lesson From Bitcoin
The value is whatever someone will pay for them.
Jon – The point on Quantitative Easing is first because until the accounting realities are properly understood there is no possibility to understand the further economic arguments
You need to work through and understand how money really works first, a great place to start is here
http://heteconomist.com/exercising-currency-sovereignty-under-self-imposed-constraints/
http://heteconomist.com/overt-monetary-financing-in-terms-of-simplicity-and-transparency/
FB thread this is from https://www.facebook.com/groups/introductiontommt/permalink/1819826431649588/?comment_id=1819960691636162&reply_comment_id=1819975934967971&comment_tracking=%7B%22tn%22%3A%22R9%22%7D