It’s poetic (if slightly sad) to watch bitcoin crash and smolder while writing this piece. Back in early February, I wrote several posts warning people not to invest in it and to be careful about the hype.
Some people listened. Others assumed I had no right to express skepticism, and a few others even ridiculed me.
They said, “Enjoy staying poor.”
My favorite comment:
You must be red assed over missing the run up from $6K to $38K in the last year, or don’t have the money to invest.I hate to say I told you so, but more importantly...
I love to say I told you so.
Here’s why:
You can’t trust Elon Musk.
Elon Musk has been teasing and torturing bitcoin and dogecoin holders for months now, making everyone guess what he’s really thinking. Just when everyone assumes they’ve pinned him down, he does something completely unexpected and seemingly illogical.I’ve made this point before, and his cult following likes to scream at me in all caps that I’m some kind of monster.
Except, look at what he does.
Like this:
Surprised? That’s his MO.
After letting bitcoin free fall for several hours, he tweeted this:
Immediately, bitcoin rocketed back up thousands of dollars. If you wanted proof that this currency’s value rests entirely on the word of a single, unhinged dude — this would be it.
So, Elon Musk doesn’t seem to have a problem (mis)leading everyone one way or the other. He’s a wildcard, and a danger to anyone with a wallet. If we had any sense at all, we wouldn’t listen to a word he says anymore. He has motives he’s not sharing with the public.
That’s just the beginning…
Cryptocurrency isn’t transparent at all.
Hardcore advocates of cryptocurrency probably don’t care what Elon Musk tweets. It’s the average person who should, though. We’re being sold a narrative about digital currencies revolutionizing the way we handle money, but the deeper you dig into this world, the more it sounds like traditional finance under a new regime, technocrats.
Here’s the thing about the traditional financial system: most people like you or me don’t understand how it works.
That’s not your fault.
That’s the system’s fault. Money shouldn’t be this convoluted or opaque. You shouldn’t have to get a degree in finance or economics to understand how your own bank account functions beneath the surface. There shouldn’t be a sea of narcissists and sociopaths working against you while you sleep at night. Predators have made it this way. They’ve created tiered systems and lexicons that prevent us from earning wealth.
My point in writing these articles is to call out the lack of transparency in how any financial system works, crypto-based or otherwise. I study linguistics, and I get a headache reading the fine print about blockchain.
That’s not a good sign.
If there’s one major take away from linguistics and language studies, it’s that entities can make language dense and obscure on purpose in order to leverage power over others. This is what control-hungry people do. They don’t just dominate through violence. They dominate through language. For example, one reader got mad at me in February:
Have you even heard of the term crypto-economics? Do you realise thats what the innovation is here? Probably not as you admitted earlier you don’t know what you’re talking about. Currency being the first application of blockchain technology is a historical footnote, nothing more, nothing else. Cryptoeconomics offer a mechanism for bootstrapping companies / systems / protocols / technologies without upfront capital. That is revolutionary, and it is disruptive. Are you familiar with the idea of disruption theory? None of this is anything to do with the value of an asset at any given moment in time, or whether or not its use is as a currency.Do you even Chainlink? Do you even DeFi? Do you even Hashmask? Do you even stablecoin? Do you even yield farm? Do you even supply chain? Do you even digital identity? Do you even care about anything that isn’t a sensationalised clearly uninformed take? What are your thoughts on the emergence of liquidty pools as a way of provisioning capital in a decentralised manner? Tell me 5 use cases for this.
The guy goes on like this for several more paragraphs. He could’ve published his comment as an article by itself, except I don’t think anyone would’ve read it. He knows that. What he did was brandish the alienating language of decentralized finance like a weapon, using it to intimidate someone instead of trying to convince them of its merits.
It’s kind of telling.
For what it’s worth, none of that gibberish is hard to look up or understand — at least on a superficial level. In reality, 90 percent of humans on earth don’t care about crypto-economics.
Here’s the key:
When you put it all in plain English, everything you can do with cryptocurrency is exactly what you can do with any other form of money. The only big difference I see is that it can now happen outside the domain and authority of governments.
In short, a technocracy.
I don’t know if I want keyboard jocks in control of my money, any more than I want Janet Yellen or Jerome Powell. At least with my green paper money, I know I won’t wake up to find out it dropped 20 percent overnight because a billionaire was in a bad mood.
Bitcoin will never go green.
It’s a little surprising that Elon Musk finally became concerned about bitcoin’s environmental impact. Those facts have been around for years, and it makes me wonder if that really explains his turnaround.
See above. (Don’t trust him.)
More broadly, bitcoin’s fans have been writing op-ed pieces for years now excusing its power consumption and attempting to explain it away. Then they do a strange little pivot to concede that while it consumes a lot of power, that fact alone will force everyone toward alternative energy sources in order to support reckless crypto mining.
Well, it’s been a while…
The people setting up crypto mining operations in China and Eastern Europe don’t seem to be making a huge effort to embrace clean energy. How long exactly are we supposed to wait? This is precisely why China has started cracking down on mining operations. They realize that nobody’s actually serious about greening bitcoin. Meanwhile, climate change has arrived. It’s not on our doorstep anymore. It’s sitting in our favorite chair and eating our food. We’re out of time.
We can’t afford to spend the next decade screwing around, trying to figure out how to not ruin the planet further in order to satisfy a bunch of Silicon Valley rejects who want to get rich quick.
Sorry…
Bitcoin has proven its instability.
It’s hard to predict whether bitcoin will die or be resurrected, or give way to altcoins. Here’s what we do know:
A helluva lot people jumped into cryptocurrency without having any idea what they were doing. They were egged on by people who knew better, and now they’re losing money. I feel bad for those who earnestly invested cash they couldn’t afford to lose.
I really do.
I don’t feel bad for people who drove the bubble.
The entire reason bitcoin and dogecoin rose in value this year was because a small handful of billionaires made incredibly public investments, and retail investors flocked to it, thinking this would be their chance to cash in on some easy money. True, some people have manipulated the market exquisitely. They know when to buy and sell.
There’s whales, and sharks.
My point has always been that cryptocurrencies aren’t really what their loudest spokespeople claim to be. Whatever purposes they serve, they’re not here to liberate everyone from traditional fiance. Otherwise, the language and logic itself wouldn’t pose such a barrier to entry. Cryptocurrencies don’t look like they’re here to save anyone. To me, it looks like they’re here to empower a new group in a financial dystopia.
Feel free to spend the next year studying cryptocurrencies as a potential investment tool. In the mean time, stay away from the hype. Keep your money somewhere else. At this rate, inflation will do less damage to your money than trusting someone like Elon Musk.
That’s almost guaranteed.
