Bitcoin is too volatile for me: Stability is coming.
One of my clients is a young guy around 30, a clever engineer who brought 3D printing into his company and saved them around 150 thousand a year. He owns several rental apartments and spends a lot of time adjusting his investments on the Helsinki Stock Exchange and nearly every session we have, he tries to advise his much older colleague on how to save money through a whole range of little loopholes he discovers.
A couple of weeks ago at the beginning of a class with a very smug look on his face, he said he had seen that Bitcoin had crashed and had lost 30 percent of its value. His smug look was the knowing look of someone that had been proven right because in one class where it was just he and I, I had introduced him to Steemit and had talked to him about how the cryptocurrency kind of works.
I answered, 'What are you talking about? It recovered by the end of the week and is up 5 percent at 4300.' This was when it dipped to below 3000 a few weeks ago.
"Really!" The smug look was gone.
I am no expert so I had told in March that with his interest in stock investing and a little help and research, he may want to consider putting a small amount into bitcoin or some others. I suggested perhaps 1000€ as I knew it was not going to be a problem for him if he lost it but, it would still be annoying because he is very frugal.
That was back when it was at $1600 and he chose to not look at it at all.
I reminded him that even when BTC had dropped 30 percent, he still would have been up around 90. At the recent all-time high, he would have been up about 350%. If between March and today he had bought near dips and sold near peaks, what would he have? I don't know because I am an idiot.
What I don't really understand though is why didn't he look into it? Why wouldn't he spend 10 minutes investigating what may be going on here? I think that this is a major issue for cryptocurrencies but it is likely one that is soon to end.
The problem is that real information is hard to come by for the average user and there are so many untrustworthy sources, scams and people dealing in FUD. Plus, a lot of the information and websites have the visual appeal of a 90s conspiracy site. For people that are coming from traditional sectors where information is delivered in a polished manner by UI experts paid by banks, the matrix style of information presentation seems untrustworthy.
My client, without investigating and only looking at the percentage ups and downs thinks that Bitcoin is too volatile and insecure. It is. But, that too is going to change very soon and unfortunately for the worse for most of us I think.
As the banks are buying in heavily, prices will boom and everyone that is currently in will benefit accordingly. The problem comes because those that are currently in the development sectors have failed to make handling cryptocurrency and blockchain easy for the average user not interested in the tech or interested in finding out, like my student.
The banks will make no such mistake however as they have hundreds of years experience roping everyday people who are unwilling or incapable of doing the research into a debt cycle. These are the same people that blockchain tech and Bitcoin were supposed to help break-free from the shackles of centralized currencies and banks. People like my client who puts his trust into a Stock Exchange and the government regulators.
This entry by the extremely big players will likely bring stability to the exchanges and will encourage more and more users from the averages to join in through the various funnels they create. For the Bitcoin and alt-coin early adopters, this will be a very wonderful time as they realise their investments and they will walk away handsomely. But, what will they walk into?
The Gross world product (GWP) is around 100 trillion per year. 100 trillion. Per year. That makes the 170 Billion current market cap of crypto look a touch insignificant. The groups that transfer and funnel this money to and fro across the globe are almost entirely banks and as they develop their investments, platforms and own blockchains, they are not going to do it so there is anonymity for the user and they are going to manipulate to maximise their gains like they have always done in the past.
The more banks buy-in with their current banking philosophy, the more controlled the average user becomes. The people who will likely walk away the richest are the ones who have created an immutable and unarguable information source for banks and authorities to track every instance of our lives.
But, even the rich who profited so handsomely will at some point need to integrate into the system in order to actually enjoy the fruits of their investments. And those will be exclusively owned by the banking networks as large companies are very unlikely to trust a group of people they recognise as 'hackers and anarchists' with running their business information and financial systems.
Each day we seem to be moving a little closer to bringing in average users and finding small ways to connect blockchain to the real world, and currencies to items but, it is slow. And when the big boys come into play, they do not move slowly, they do not care about freedoms and they will pay extremely well for those who can develop for them.
On top of this, many of the developments that are being made are replacement technologies that do not actually change anything in the real world. There is blockchain Twitter, blockchain Youtube, blockchain Instagram. These aren't new innovations, they are taking something old and putting it on the blockchain.
I am not a technical person but this is not going to attract a massive influx of average users as it brings no change for them in there day to day life except perhaps like Steemit, a little money.
In my ignorance, I see that the true value of the blockchain is to be invisible to the average user so they do not need to make some kind of revolutionary mental shift. What I mean is that it should be replacing the banking networks and backbones and wresting control away from the centralized big boys. It should be integrating itself into every day life seamlessly yet still decentralized so that average users can be secure from global controllers.
It needs to start solving the real world problems for normal people who believed that these things were unsolvable. It needs to show to the everyday person how much banks and governments manipulate circumstances for profit and control. It needs to prove that it has value beyond giving those in power, a more precise tool with which to divide it.
It needs to work out how to ease suffering, face poverty and wealth inequalities, improve education and encourage free speech and freedom of choice, place control back in individual hands, combat unemployment and oppression and spread the power among the people of the world so each of us has the chance to be our best.
The thing is, everyone wants a Lambo, the same as everyone on Wall Street.
A bit of a rant.
Taraz
[ a Steemit original ]
I do not know much of the tech, the financial systems, the banks... I don't know much of anything really. What I do see however is this world is a mess and if we as the 'free' people are unwilling to truly do something about it, nothing is going to change except for a continued increase in the loss of freedoms.
Banks can buy bitcoin, but they can't print more of it out of thin air.
That's the problem with dollars.
Can they make their own coins and blockchains though and then convince a massive number of people to buy-in or in time, make it a compulsory shift? Can the massive hedge funds and pension funds put their money into the banking coins?
And they could influence them to fork a few times effectively multi folding the amount in circulation:)
if someone offered you triple for all of your coins now? Would you take it?
if the market cap is 170 now, the banks need 510 to buy the market. They only really need a lot and never put it for sale again while at the same time creating their systems for their customers to invest in. Once that is done, there will be some very rich people with a lot of cash. What will they do with it?
I don't know if that works but the US bailed out the banks to a tune 3 times that in 2008.
Yes, i would sell it for double actually. As i had quite bit of luck day trading, just my budget is ridiculously small.
This comes back to a point, where i some time in the past i have said said that the whole blockchain project is run by some government. I do not know which one:) Figure.
Just so many people are hyping that banks and government is scared of BC. Let's not be funny, you have just mentioned two numbers here. Blockchain market cap and worldwide economy, which is more of 150 trillion but different sources give different estimations. That 100-150 trillion is just half of the amount because of grey market and because nobody knows how much money has been actually printed.
So. Once scenario. Lets admit governments and banks are scared of blockchain impact :) With a snap of a finger, they buy up all market cap. All if it. That miserable 170 billion. With the money they have just created if needed and hold it. What would the rest trade? It will take time to mine new blocks, to create new currency but there will be none in circulation. It's just an assumption, does not mean i am right:) But you can prove me wrong of course.
I am with you on that. ^
I have often wondered if it is just a way to identify and categorize potential dissidents globally. I like a good conspiracy but I don't think it is too far fetched to imagine.
Good questions. I investigated moving my AUD $50,000 Superannuation into bitcoin when it was at $50.
There wasn't an 'acceptable' vehicle, so despite being 'mine', I missed out on a couple of million dollars.
It's up to about $54,000 now.
Hope they're not expecting me to fall over myself with grovelling praise for their 'guidance'.
Yep. They will catch on fast in my opinion.
Yes, they can. I suspect they will destroy the point of having a blockchain by having only trusted nodes on their blockchain, but they will be able to use the buzzword "blockchain." If they don't have trusted nodes, I suspect their coins would get hacked by a 51% attack.
No. they would never! the banks and governments have more honor and integrity than to hijack ideas and manipulate them for their own gain. you must be crazy... ;)
No, they can't make such things even blockchains since they depend upon Government policies and funds. Bitcoin prices are not stable, so I can't say for your second question.
It cannot work for obvious reasons: The effort and amount of resources required to Force or Dupe everyone with another scheme will not reap the ROI because they have been called on their Acts and their business are operating under bankruptcy protection while they are liquidated. Granted there's plenty a Fools out there, you cannot be deceived when you find out you are being deceived. What's happening is that these banks have largely participated in fraud. They are in liquidation as we speak, they are searching havens on this earth that will look past this insurmountable crime. What we are seeing is the products of meticulous indoctrination for generations and intent to defraud for centuries, and what is critical is that we have learned our lessons, we have begun waking up, people can't go back to sleep anymore. I have seen the light, we have seen the possibilities, we have recognized who and what we are and have had a taste of our potential, we have been patiently conned and we have graduated from the school with HIGHEST accolades, we have taken the lessons and we are creating our harmonies of interacting and the ominous and overarching bANK is/are but paper tigers and in terms of Production, besides things only labor falls in there, and not Tokens of Value or Bets and Gambles with them. At the end of the day we cannot eat bitcoin or gold, when we awake as a whole we better have the vision to move away from this arbitrary and insensitive representation of value and cut out all middle men, we have to do it in such a way that we don't leave anyone hold the bag and we are more than capable to do this despite all the FUD and concentrated criminality.
Very true indeed @mattclarke, and thanks for this article @tarazkp!
I knew Wall Street was on their way, so I've been smashing some bills into Bitcoin lately... plus for the two upcoming free airdrop coins as well!
I hate to burst your idealist bubble, but mining and proof of stake which result in inflation are exactly the same as a government supplying extra currency.
Except when it's constant and fixed and when the new currency goes to those supplying a valuable service.
All that matters is market cap. A fixed supply will just inflate to higher prices.
The "average user" is exactly what I don't want. they can go play in average land with stocks and bonds. Bitcoin got to 5k without em and I love that bitcoin is confusing and unpolished it keeps the riff raff out who need someone to make things "safe" for them and pave the way and destroy the volatility.
So many love crypto but then clamor for "average users" they don't realize that by doing so they are just going to have stocks bonds etc. The big players don't get involved in things they cant control, that's not how they roll.
The issue isn't for Bitcoin really, it is for whatever the big fellas decide to do in the future because they may be able to replace their own outdated practices with their own chains and rules and then start cutting all ties with n'non-approved' chains. At some point I think, Bitcoin and alts become useless if there is no way to buy products. Lamborghini may not accept it.
Average people are idiots. They will back what they know and repeat what they know. This is why most of the innovation centres on doing what has already been done, except fantastically, on the blockchain.
I could reply with one short sentence. Because majority of people is lazy. But that would be impolite answer to such a lengthy and good post to a point.
I will not be talking about the bigger plan, about nature and how it creates "different kinds of people and their mentality" to fill in all positions. Somebody has still to sit at cashiers desk or work as a security guard in a shopping maul. But that reply could get longer than your post :)
Do not get me wrong i see nothing bad at working at a cashiers desk or being a security guard. We all get locked up in certain situations sometimes where we have to make sacrifice for the family or there are zillions of other circumstances. There is totally nothing wrong with an honest job. But...
(somebody has said that everything that comes before a but means shit) Anyway. But do not be lazy to learn something new, no matter how beat up you are, no matter how tired. This is an opportunity of a life time, for many of us. Use it. Another one of such magnitude might be coming after ten years or so. Learn, study, try. Try small and build up.
But the resume still would be. Many people are too lazy or think they are entiteled to something.
The laziness is what I think will kill us all. Laziness turns to authority for security rather than developing the skill of the individual. This means that the vast majority stick to a status quo of living under the thumb. It is how they have been trained to behave. If the world is to change, new training is required.
This will not be happening mate. It is moving to quite an opposite direction. They are talking about the passive income everybody is entitled to receive :) Just for doing NOTHING. Actually you are paid to do nothing. Because if you do you will probably have certain problems :)
And it is soooo easy to rule huge, dumb, lazy herd of consumers who's only task is to consume that passive income they have been handed out :)
Yep. people continually tie themselves to to authority and wonder why there is so much suffering in the world.
Yup! I second that. I also agree.
“It seems like people don’t actually want democracy anymore, they want a dictator who agrees with them all the time.”
If banks buy all bitcoins, you can buy bitcoin as well with other alt-coins of the top 20. The banks can't buy the market. the clear example of that is the ripple which jump from 3 cents to 40 cents and it is used by banks. To compete banks buy more coins as you can.
True. European banks admitted that any euro can be lent out 7 times to any people. Thinking this way, how can we still trust the current banking system?
Bitcoins or not, there should be places for the cryptos.
We are now in the early adopters part of the curve, I think that mass adoption will come when it comes, just for every other market dynamic where the donkeys needs to see institutional investors entering the game in order to be convinced. Personally when investing on crypto I followed the two well known golden rules related to any speculative investment: invest only what you can completely loose without worrying; build your wallet and forget about it (avoiding obsessive-compulsive behaviours, behavioural finance is a bitch).
My issue here is less the crypto market and more about the control world powers have over us. Yeah, considering it all, I may do okay out of it but at what cost to others in the long run? It is more a philosophical issue.
Yes you're right, I don't know why I focused on the investment point, the purpose of your article is clear. The fact is that if we discuss about the behaviour of the masses the history repeats and the patterns are always the same. From internet onward, there's not even the alibi of not being able to have access to information anymore. Sadly, nowadays humanity is flooded by information but is more ignorant as ever.
Most looked at it the same. I am far too unqualified to really get deep into tech or investment sides. On the philosophical side, everyone can have a go :)
It is this ignorance I would like to change as it breeds arrogance. Too many think that crypto is 'safe' from authority.
You can bet everything that the big banks will dig their claws into crytocurrency, they're already strategically working on their own ICOs (Goldman Sachs).
If corrupt establishment firms like Goldman get involved, you know they will lobby and payoff to regulate other coins. Here in the USA it is nearly impossible to buy cryptos with USD. I can't stand it!
The US is very protective of its dollar, there is too much money to let anyone create an option to use. Yes, they will lobby hard and their friends will pass law after law.
OMG, I have voted you from the bottom of my heart, this is so motivating and inspirational, but I still feel like we need leaders to propagate this wisdom and this way of thinking, because we need a plan and objectives to release from the banks and governments domination. Do you, or anybody have a good idea about how should we proceed further?
besides burning everything down? ;)
we need to find a peaceful way to handle things :)
Very good post, thanks. Yeah, when I looked at 'coinmarketcap.com' last, there were some 1170 cryptos listed. All of this is going to change, I believe. I see many (most) of these cryptocurrencies disappearing, and we know the criminal tendencies of the bankers will probably change the remaining situation, for the worse.
Greed, and the lengths that some are willing to go to in order to profit, always causes harm to the world as a whole, ALWAYS. Powerful countries happily create debt in struggling countries, that can never be repaid, in order to seize their resources. (World Bank - IMF) War is also an option. I live in the US, I know! Our government says we're spreading Freedom and Democracy, but it sure looks an awfully lot like Death and Destruction to me!
This is the issue that most of those coins have no real world connection and will disappear. The banks will be sure that every coin they make is backed by them and connected to the largest organizations in the world. They will offer security of mind... false security but one people respond to.
I believe that. It's sad that some of the worst criminals in the world control our money, and entire global economy. If a few dozen (at least) were still rotting away in prison from the 2008 fiasco, maybe they'd at least think twice before they do what they do. I doubt much would change, but I'd enjoy watching different ones head to prison from time to time. Instead, they're making their $150 million/year salaries, and getting their $100 million bonuses, and that's just what we know about! I literally get a sick feeling when I think about it. Some people are starving, yet some of this scum could literally feed small countries!
It's unfortunate that the average person attaches the term scam with bitcoin. And banks fear what they cannot control