Crypto’s Scott Melker details top industry lessons

Loaded with stories of successes, failures and everything in between, history is filled with figures who have led the way for others to learn from their mistakes and progress. The crypto industry is a relatively young sector, having started in 2009. Crypto industry players with years of experience are likely to have seen a number of key events amid the sector’s early formation, able to tell a story or two at times, also sharing their knowledge with later generations . One such seasoned crypto personality who touts wisdom to share is Scott Melker, aka “The Wolf Of All Streets” on Twitter.

“Learning about bitcoin sent me down a rabbit hole to better understand the problems with fiat money and the legacy financial system,” Melker told me in an instant message as one of the two most important lessons crypto has taught him. “Once you take the orange pill, there’s no going back.”

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Previously wearing career hats of producer and DJ, Melker dove into the crypto industry in 2016. Well-known in the crypto space with a Twitter audience of more than 800,000 followers, Melker now has his hand in several crypto-specific endeavors, including investing, trading and podcasting.

In the crypto industry, taking the orange pill essentially means learning about bitcoin — apparently a shoutout to a scene from the movie The matrix where protagonist Neo is offered a blue or red pill, each leading to different futures. (Bitcoin’s logo is orange.)

Started in 2009 as the first crypto-asset that eventually kick-started the surrounding sector, bitcoinBTC
(BTC) remains the largest crypto asset with a market capitalization of more than $400 billion according to CoinMarketCap at the time of publication. Bitcoin, at its core, exhibits a number of strengths compared to traditional money, metals and other valuables. For example, owners can send BTC digitally worldwide without relying on traditional intermediaries such as banks. BTC also has a fixed maximum coin supply, and holders can digitally escrow (self-store) their BTC. Additionally, bitcoin is not directly tied to any government or border. With a maximum supply of 21 million coins, the asset could also look attractive as a store of value given the number of people in the world, pending growing adoption and demand.

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[Ed note: Investing in cryptocoins or tokens is highly speculative and the market is largely unregulated. Anyone considering it should be prepared to lose their entire investment.]

In contrast, fiat money supplies (such as the US dollar) are subject to change, and the value of the currencies themselves is essentially tied to the actions of their related governments. Additionally, sending fiat money, at least in the US, usually requires banks or other intermediaries to facilitate and settle the transactions.

However, BTC has its drawbacks. The asset’s value has historically risen and fallen dramatically in price. Bitcoin’s price has climbed to significant heights in the years since its inception, but that doesn’t mean the same will happen in the future. Putting money into the asset and seeing its value decrease significantly can also be a tough pill to swallow, especially given the asset’s youth compared to assets like gold.

As for the second best lesson he learned in crypto, Melker noted “the importance of being an investor first, having a low time preference and zooming out.” The crypto market moves quickly in terms of price, news and developments, which can draw attention to short-term action while distracting from larger concepts and beliefs. Melker’s commentary essentially talks about investing (making fewer moves in the market compared to trading), looking at market plays with the long-term future in mind rather than the short-term (short-term preference) and stepping back to consider the big picture.

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Disclaimer: I actively trade cryptocurrencies as well as have a small amount of BTC, Gold, Silver, ETHETH
LTCLTC
ZECZEC
BCHBCH
LINKLN
LINK
and CNFI.