Crypto/Blockchain
Cryptocurrency has been lauded and brutalized for a little over a half-decade now, with a little bit of a cult following and a lot of skepticism. I have always been more on the skeptic side, but I still think there is a lot of potential there. While I have never and likely will never own any crypto, I think blockchain technology is genuinely impressive.
First of all, I should probably give a quick overview in case you’ve been living under a rock for a decade. Cryptocurrency is a commodity, Bitcoin and Ethereum are the most famous cryptos traded in the thousands of dollars. You can think of cryptocurrency as being similar to the trade of oil or gold as commodities. The only real difference (and it’s a big one) is that cryptocurrency has no inherent, actual, value. Bitcoin is only valuable because people say it is. In response to that statement, some people say that the US dollar and other national currencies are only valuable because we say they are, and that’s partially true. However, the Dollar has the total weight of the United States government behind it and centuries of value. Cryptocurrency has nothing backing it, unlike gold or oil, both of which have been used historically. And for that reason, I will likely never own any, there is nothing to base any move or trade on. I can’t look at earnings reports or competitors, it doesn’t mean anything. However, blockchain technology genuinely has potential.
The blockchain is what cryptocurrency is traded on. The blockchain is completely public, you or I could access it and see every trade that is completed across it. This doesn’t require a bank, government involvement, or anything else besides a laptop. It’s a public ledger that cannot be altered retroactively. Whenever a transaction is completed, it is automatically entered into the blockchain like a cell in an Excel spreadsheet. The potential of blockchain technology is large, not so much cryptocurrency.
You or I, or a kid in Africa could complete a transaction without any third party. We could remove banks from the equation entirely. The transaction would probably not be done in crypto, however. Crypto’s time is over, it was a fun ride, but that’s done. Too much hype, and not enough results. It won’t go away completely, just be minimized to the level of other commodities. Whenever something crazy happens in the world, crypto will shoot up and be relevant for a couple of days, or whenever a judge makes a decision that loosely benefits crypto, the diehards will continue to buy. You shouldn’t buy cryptocurrency, but you should buy into the blockchain, and its potential. It’s one of those technologies that will be sneaky useful for the next ten years, before being taken to a whole new level by something brand new, like AI.
