In recent years, many crypto enthusiasts, economists, and opinion leaders have been making rather skeptical, and sometimes even mocking statements about cryptocurrencies. For example, American economist Nouriel Roubini stated that “Blockchain isn't about democracy and decentralization—it's about greed,” and crypto enthusiast Jimmy Song argued that EOS is a scam, and Ethereum is an amateurish project. On the other hand, a whole sect was born among the supporters of Bitcoin, whose members blindly believe in their own made-up ideals. This material will explore how to maintain balance, adequately assess the possibilities of Bitcoin and other cryptocurrencies without falling into any of the extremes.
Hatred Towards Bitcoin: Is There Any Reason for It?
“First, Crypto is the mother or Father of all scams and bubbles,” said Roubini. And his words, perhaps, have some grain of truth to them, because the majority of the constantly emerging cryptocurrencies cost almost nothing to create, and EOS can really turn out to be a shitcoin. The price of Bitcoin, until recently, also showed strong volatility, which was replaced by relatively small price fluctuations in recent times.
Therefore, if one bought Bitcoin at the time when it was at its peak, it is likely that one could lose about 70 percent of their investment. In general, this is similar to gambling.
In the media, there is a fierce struggle going on between the supporters of cryptocurrencies and their opponents. It cannot be said that journalists do it intentionally, however, they certainly work for clickbait. Bitcoin ETFs and Ethereum futures contracts are another set of goals "for cryptocurrencies." Whether someone likes it or not, such trends legitimize digital assets, uplifting them to a new level.
There is an opinion that cryptocurrencies are nothing more than investments for the poor, for whom Bitcoin became an idol. "People with zero financial literacy, people who could not tell the difference between stocks and bonds, literally went crazy with investing in Bitcoin and cryptocurrencies," Roubini said. It is highly probable that in the future, however, citizens of different countries who are tired of paying taxes to the state and being linked to the national currency will express greater interest in Bitcoin. This will lead to the fact that Bitcoin will add to its price, as its scalability will increase, which automatically multiplies all the rage about the "poor illiterate investors" by zero.
The trend of the arrival of the world's first cryptocurrency in all areas of life is already noticeable as more and more institutional investors are seeking to invest in Bitcoin, the network is becoming safer and discussions of its future are continuing in the media.
This scenario has a downside. In the course of the growth of the popularity of a phenomenon, it undergoes a significant transformation. Initially, Bitcoin was based on the same values, but as it grew, it was transformed into something else. It is obvious that Bitcoin and the attitude of society towards it in 2018 differ significantly from those of 2014, and both of them, in turn, differ from those of 2010.
One cannot consider the entire world economic system separately from various phenomena. Undoubtedly, the rise of Bitcoin is one of the most significant events in the global financial system lately. It has reached a level at which the central banks simply cannot ignore it. Now they are forced to revise their monetary policy in order to be ready to compete with Bitcoin. Thus, even if the crypto industry does not completely supplant fiat, it will certainly do a lot for its transformation.
Blind Adoration Is a Path to Zombification
Nevertheless, one should avoid the other extreme in the form of selfless worshiping of Bitcoin, bordering on a cult level. The ardent defenders of Bitcoin already have many attributes inherent of cults, such as a few books to which they constantly refer, a short list of influential people they listen to, regular conferences and so on. At first, it was like a game, but later it all stopped looking like one because the opinion of the members of the “cult” became the dominant voice representing Bitcoin. Bitcoin became an idol, and all altcoins are often portrayed by its advocates as “frauds.”
This trend is dangerous not only because it scares away new crypto enthusiasts, but also because it presents the supporters of Bitcoin as loons. This image of the supporters of Bitcoin goes against the original goal of creating the world's first cryptocurrency. After all, money is only a social contract for a huge number of people who agree that it has a certain value, and we can exchange it for goods or services. It is a tool for cooperation. While the overwhelming majority of people believe that the dollar is the main world currency, supporters of Bitcoin hope that it will soon be replaced by the first cryptocurrency. Currency competition can be considered the direct opposite of the "cult of Bitcoin." A free market that encourages experimentation and innovation is the best way to achieve progress in all areas invented by mankind. Competition is good because it grants cryptocurrency users the possibility of self-government.
The Golden Mean Is the Only Rational Approach
Despite the fact that Bitcoin is still the best option to deal with centralized banks that maintain dishonest monetary policies, it should not become the ultimate goal. “Bitcoin is not the end-goal. It’s a means to our goal of censorship-resistant, permissionless, denationalized money that we can opt in and out voluntarily, not by coercion, social engineering, or threats of violence. True decentralization is when there are many competing money projects, not just one. May the meritocracy (the power of the smartest) win,” says an author of Medium under the name Ferdous Bhai.
On the other hand, according to other crypto enthusiasts, if Bitcoin maximalists exist, their influence on the market and people's opinions is minimal, and they should not be perceived as a threat. “At the initial stage, maximalism is necessary for any project. Attracting supporters on a grant basis is possible only at the expense of a strong idea that automatically implies the principle of maximalism. In the future, with proper scaling and fame, maximalism disappears by itself as the mainstream trend. This is a natural process of blurring the original values. Therefore, I would not sound the alarm and create panic from naught. Moreover, I do not see manifestations of maximalistic sentiment on the market now, with the exception of one-time statements by public figures, such as, for example, John McAfee. The market seems to stop responding to such extravagant tricks and pays more attention to the statements of regulators and their decisions, and also operates with actual market data. Yes, the technology itself, the entire industry implies the absence of a single cryptocurrency, but the presence of a developed system of digital assets,” as commented by the spokesman of the Wirex crypto bank Roman Zabuga to DeCenter.
One way or another, it is obvious that everything is good in moderation, and if you decide for yourself that Bitcoin has a future or, on the contrary, you are very skeptical about it and the industry as a whole, you should not give up critical thinking. It is better to accept reality as it is. In a complex world, there can be neither easy solutions nor simple answers to complex questions.