Why I still believe in Bitcoin
One more day, you might say.
The difference, this time, is that an influential player, perhaps the most important in recent months, is down. FTX, the cryptocurrency’s buy-and-sell exchange, has fallen. It was worth $32 billion in February. CEO Sam Bankman-Fried, 30, was seen as a crypto messiah.
But the whole house of cards has collapsed.
Thousands of investors lost their savings. It goes beyond losses that will affect people’s lives. Let’s not forget the mental disorders that this disaster can trigger: depression that can even lead to suicide.
Large investors have already begun to take stock of their losses. Every player in the industry is looking to find out if a friend or rival had any connection with FTX. This disaster has managed to do what critics of cryptocurrency have always hoped for: to bring shame on the entire industry and to discredit it. In recent days I have heard many critics say: “you should have been warned”.
The recurring criticism continues to be: “What are cryptocurrencies used for? They are of no use.”
This is undoubtedly the misunderstanding of the critics of digital currencies. They believe that cryptocurrencies are scams.
Cryptocurrencies are based on a technology, Blockchain, which is revolutionary. It is the basis for a new internet that is not controlled by big tech like Google (GOOGLE) – Get a free report and Facebook (META) – Get a free report. It is a decentralized and transparent internet. It’s called web3. On this internet, each of us is in control of our data and is free to do whatever we want with it. This decentralization can extend to everything.
For example, the crypto industry gives us the opportunity to get direct loans from someone who is willing to lend us the money. No bank, no centralized financial institution that will take a commission. If I want to send money to my mother in Africa, I don’t have to pay huge fees to Western Union or MoneyGram.
And it’s not just about fees. Western Union verifies my identity and keeps my data. I don’t even know what it does with it. With cryptocurrencies, I don’t have to give out my information to anyone.
Inevitably and predictably, when this new technology started to translate into big money, that’s when it got all the attention.
It is clear to me that the benefits of cryptocurrencies are real. These currencies represent a technological revolution. The road is bumpy, but that doesn’t mean I’m going to dismiss them as a bad idea.
The Internet bubble of the 2000s is an example. There is no doubt that the internet has changed our lives. Nevertheless, there will always be those who try to exploit the gaps in people’s understanding of the new technology or those of an evolving legal framework to make easy money.
Nevertheless, no one can dispute the value of the internet in our lives, such as the ability to chat on different platforms with family, friends and colleagues. When the dot-com bubble burst, all the companies that lacked a sound business model disappeared, while those that solved a real problem or brought something meaningful to society thrived. Amazon is an example. It almost went bankrupt but was able to survive and has since become a juggernaut.
It will be the same for cryptocurrencies. The industry will be shaken. Prices will plummet and investors will weed out all vulnerable and worthless projects. It is a necessary evil.
So I’m getting ready. I have fastened the seat belt. I don’t know what’s coming yet.
But I trust that in the long run cryptocurrencies will prevail, at least those that are able to prove their utility.
