The honest truth about cryptocurrencies
- Its a gamble
The volatility of cryptocurrencies is well known. The price could change within hours, making it difficult to use as an actual currency. Additionally, a crypto could be popular for a while and turn out to be a scam or a bust.
2. Peer-to-Peer and Decentralization has been forfeited to Crypto Exchanges.
The original idea behind cryptocurrencies was to have a decentralized currency built on trust that allowed peer-to-peer transactions to purchase goods and services. However, most people have hot wallets on crypto exchanges. And most crypto apps are tied to some exchange that centralizes crypto transactions where the exchange act as a bank.
3. It’s not used as a currency (unless you’re on the dark market) but rather as a security.
People watch the price of cryptocurrencies go up like they watch the stock value go up on the ticker. People buy crypto because they hope to buy low, hold onto it, and cash out at a higher price. People treat crypto as an investment, not as a valid currency. Very few people actually use cryptocurrencies to purchase goods and services unless it’s on the dark web. It’s money…that you don’t spend.
4. It has no real value
Crypto has no real value unless it has massive support from the public or powerful people/organizations (which goes against decentralization). I know what you’re thinking, “the dollar has been backed by gold for decades!” Yes, this is true; however, it is backed by the most powerful government on the planet and is the defacto standard for international trades.
Treat crypto as a security, and only invest what you are willing to lose. Also, invest in a crypto that has strong staying power!