It won’t be wrong to say cryptocurrency is ‘people’s currency, for there is no third party (government, central banks) keeping an eye on it. The system involved is (mostly) decentralized that further makes it secure and trustable. The whole idea started in 2010 with Satoshi Nakamoto’s Bitcoin. From then to now, thousands of cryptocurrencies have been introduced, Dogecoin, Tether, Ethereum, Nano, and so on.
Although countries like the USA, Canada, and Britain have openly accepted the idea, countries like India, China, and Russia condemned the use of the same. Perhaps that’s the reason people are more interested to invest in crypto rather than using it as a medium of exchange.
However, it is believed that India will soon launch its own crypto named ‘Lakshmi’. This will be a game-changer.
There is no denying the fact that digital currency has several advantages like no banking fee, complete control, and no inner corruption involved, but these advantages can turn themselves around. (For example, since there is no banking fee involved, you would be responsible for your own transactions, not ignoring the fact that these transactions are irreversible.) You might be safe from third-party corruption. But the anonymous transactions give a golden opportunity for illegal and criminal activities to take place.
Whether to like it or not is a personal choice. But what we are seeing today is a craze. People are not sure about the idea behind virtual currency, yet they are so eager to invest in it. Thanks to this man.
Although the idea of digital currency had already gained the interest of netizens back then, the idea got widespread attention when Elon Musk tweeted about it. The price started skyrocketing. Bitcoin’s worth way more than 47 lakhs (INR) till 13 April 2021. There was a whole different industry coming out just because of this thing. Many apps came into the market just for crypto investments.
And after all this, all it took was one tweet from the same person to turn this all around. Although the reason behind it seemed genuine, which was the environmental issue due to the use of fossil fuels for generating electricity for machinery that mined Bitcoins. The main concern was that a single tweet had enough power to trigger the market of such a unique technology was unbelievable. Today the price of Bitcoin is around 24.44 lakhs (INR).
What was more bewildering, was that Bitcoin alone didn’t bear the brunt of all this, but every cryptocurrency saw a spark decline.
Warren Buffet, the most successful investor, said, “I don’t have any Bitcoin. I don’t own any cryptocurrency, and I never will.” Being an active critique of digital currency since the very beginning, he has made several negative remarks against the idea. Back then, financial experts said that he is too old to understand the technology behind that idea. Well, who is old now?
It is believed that by the end of next year, every country will have its own cryptocurrency. Seems interesting, right? Finally, you would be able to use crypto for purchasing.
What we seem to overlook here is that the main motive behind the idea will get destroyed. The idea got famous among netizens as they wanted to get rid of the third party that is the government. When the government will launch its own cryptocurrency, there would be no difference left between the two, except for the difference in nature.
This article is not to discourage you from supporting the idea of digital currency. The exciting idea brings about a change in the problems our current monetary system is facing. But there is a difference between accepting an idea and going crazy over it. People do unbelievable things when they go crazy.
The crash we saw in the crypto market could have been avoided had we been more pragmatic about the idea. Will it recover from the crash or not seems unpredictable.
When I say ‘unpredictable’, it’s because something similar had happened in 2013. When the price of Bitcoin started falling after reaching the $1000 mark. The fall was so severe that the price was reduced to $300. It then took almost 3 years for the cryptocurrency to touch the $1000 mark again.
Cryptocurrencies do have the power to reach where they once were. But are we ready for that? Has our decision-making sense become independent enough to not get influenced by a tweet?
Every idea has its own pros and cons. Choosing which idea will be the best is an individual choice and should remain an individual choice only.
Perhaps the answer in the very first line of this article does make sense. The craze has gone too far. This craze has heavily influenced the market of crypto.
Every unique idea can fail and rise again, especially when it solves the problem we currently are facing. The concept of blockchain is revolutionary, and it has a very long way to go. The working of market is still a new topic for many of us. Understanding the factors that influence it is crucial. A billionaire can make an opinion, to get influence by it depends on us. We all have different experiences, lifestyles, financial status, etc. Then how can we expect the same strategy for an idea to work the same for everyone?
Herd mentality is not always pragmatic. It can sometimes get influenced by craze. Let’s be a little more considerate next time.
