Your Brain On Blockchain - Leverage The Revolutions Of The Internet, Our Information & Our Money
April 10, 2022

Crypto Rhapsody #1

Crypto Rhapsody #1
According to one media account, JP Morgan says that bitcoin dominance over stable coins suggests a bearish divergence.
"Characteristics such as decentralized, borderless, and censorship-resistant are great for a monetary asset, but huge price swings are not. It is difficult to build a reliable financial system on top of a currency that can lose 50% of its value in a matter of weeks."
Just like gold bugs who don't understand what a gold standard really is, there are many bankers who don't understand what money is. I would say there are many folks who cant tell the difference between money and currency.
Money is adopted. It isn't built. Who asked you(Jamie Dimon and Central Bankers) to build a financial system?
The one you built, you didn't ask the people, you built it to steal from the people.( Remember Inflation)
That's why bitcoin was created.
Naturally they prefer stablecoins, since those often require banking services, unlike bitcoin. The arguments against volatility all fall short on one thing. They are comparing apples to oranges. Nobody said that bitcoin is money yet. It is still an emerging currency and system.
Like any such thing built by the voluntary cooperation of market participants, it will have real value, rest assured,
Lets look at monetary history. Im sure you remember "tulip mania", It did not last more than 10 years. The tulips did not have a use case either or we should state that it didnt have any utility. But, the mania was helped by the first central bank.
Adoption historically takes time. Gold was adopted.It was adopted over thousands of years. Its adoption helped found civilizations, a civilization's growth resulted in an increased demand for gold over time as well. Ludwig von Mises established this process as the regression theorem, which explains the theoretical origin of money. But this happened over time, which allowed for production to keep up with the demand. Still, I can assure you that if gold lost the market's support as a viable monetary asset, it would lose much of its value. The demand for gold as jewelry would not support the gap in value created by the drop in its much larger monetary demand.
Hence, if you want to ask, what backs gold, it's the market's confidence that it is still the best monetary asset to hold to protect against what the government and its banks do to their fiat money. Cryptocurrencies are "mined" over time too but civilization and price structures already exists in much of the world today, so the adoption is likely to have a more pronounced effect on value than anything humans have dealt with in the past.
It is true that money in the end is something that the market prefers to be stable. But the market isn't finished its product. It is still experimenting.
My point is that volatility is not a good reason to reject the experiment at this stage. Nor is it a good reason to intervene.Nor should anyone with any judgment listen to any bank that is part of the system that cryptocurrency projects are aiming to disrupt.