The cryptocurrency sector faced one of its most significant security breaches this year as stablecoin banking platform @0xinfini fell victim to a sophisticated cyberattack.
Real currency represents debt. You’re paid money that represents what is owed to you for work you’ve done. Or you’re owed something because you handed over a product so you’re handed money that represents what you’re owed.
Real money is created when money is borrowed. Because real money represents something owed. Interest rates are set to control how how much money is borrowed which impacts the money supply, which impacts it’s value.
Crypto “currency” would be terrible to use for loans, as that would be effectively shorting it which as something that’s value is determined purely by speculation could result in you owing way more in real value than you originally borrowed. Buying crypto is a gambling the money you put into it. Taking out a loan denominated in crypto currency is gambling an infinite level of liability.
Since it absolutely fails at the primary function of currency (representing debt) crypto “currency” is definitively not a currency. It’s only believed to be currency by people who don’t understand what currency is.
The only real difference between cryptocurrency and fiat currency is who manages the money supply. In both systems, the value of the currency is determined by the users of the currency. A cryptocurrency merely takes the control of the money supply away from a central authority and relies on distributed algorithms and consensus to manage the money supply.
Whether something is volatile has no bearing on whether it’s a currency. A currency is merely something primarily used as a medium of exchange. Tickets at an arcade could be considered a currency because they only have value in the context of what they can be exchanged for. It has nothing to do with debt and everything to do with exchanging symbols of value.
Yeah no shit they’re controlled by different groups of people.
Real currency is managed by a central bank which has as it’s goal to keep it stable with slight inflation over time. Because that’s what makes it good for doing loans with.
Cryptocurrency is controlled by speculators looking to make money from rug pulls.
Tickets at an arcade could be considered a currency because they only have value
You’re still thinking currency is supposed to have value beyond being something that makes it convenient to conduct transactions in. Money is a simply an incomplete transaction. You’re trading something of value for something else of value. You do labour you’re owed something. You buy a product, you’ve completed the transaction, trading labour for a product. Money exists when that transaction is incomplete. It’s a temporary thing that only exists because it’s inconvenient to haul around chicken, bushels of grain, or anything else someone might want whenever you’re making a trade.
Crypto currency operates on the premise that money is supposed to have value in and of itself and that value should be increasing. It’s valued because people believe it will increase in value with some underlying belief that it will someday become a currency. But once everyone that could ever get suckered into buying into it has already put all of their money into it, it can no longer increase in value and those that invested into it to make a profit will sell, causing the value to crash.
There is no benefit to crypto other than for illegal activities like money laundering and for scamming people. It would be stupid to take out a loan denominated in crypto as it could increase in value. So businesses will never be financed in crypto which means it’s inconvenient for business to pay employees in crypto, which means it’s inconvenient for those employees to buy legit products in crypto. The whole point of currency is to make transactions more convenient and crypto fails at that because borrowing crypto would be stupid.
So it’s not real currency and never will be because the libertarian concept of money that has increasing value doesn’t work for financing and therefore won’t work in a capitalist society.
Real currency represents debt. You’re paid money that represents what is owed to you for work you’ve done. Or you’re owed something because you handed over a product so you’re handed money that represents what you’re owed.
Real money is created when money is borrowed. Because real money represents something owed. Interest rates are set to control how how much money is borrowed which impacts the money supply, which impacts it’s value.
Crypto “currency” would be terrible to use for loans, as that would be effectively shorting it which as something that’s value is determined purely by speculation could result in you owing way more in real value than you originally borrowed. Buying crypto is a gambling the money you put into it. Taking out a loan denominated in crypto currency is gambling an infinite level of liability.
Since it absolutely fails at the primary function of currency (representing debt) crypto “currency” is definitively not a currency. It’s only believed to be currency by people who don’t understand what currency is.
The only real difference between cryptocurrency and fiat currency is who manages the money supply. In both systems, the value of the currency is determined by the users of the currency. A cryptocurrency merely takes the control of the money supply away from a central authority and relies on distributed algorithms and consensus to manage the money supply.
Whether something is volatile has no bearing on whether it’s a currency. A currency is merely something primarily used as a medium of exchange. Tickets at an arcade could be considered a currency because they only have value in the context of what they can be exchanged for. It has nothing to do with debt and everything to do with exchanging symbols of value.
Yeah no shit they’re controlled by different groups of people.
Real currency is managed by a central bank which has as it’s goal to keep it stable with slight inflation over time. Because that’s what makes it good for doing loans with.
Cryptocurrency is controlled by speculators looking to make money from rug pulls.
You’re still thinking currency is supposed to have value beyond being something that makes it convenient to conduct transactions in. Money is a simply an incomplete transaction. You’re trading something of value for something else of value. You do labour you’re owed something. You buy a product, you’ve completed the transaction, trading labour for a product. Money exists when that transaction is incomplete. It’s a temporary thing that only exists because it’s inconvenient to haul around chicken, bushels of grain, or anything else someone might want whenever you’re making a trade.
Crypto currency operates on the premise that money is supposed to have value in and of itself and that value should be increasing. It’s valued because people believe it will increase in value with some underlying belief that it will someday become a currency. But once everyone that could ever get suckered into buying into it has already put all of their money into it, it can no longer increase in value and those that invested into it to make a profit will sell, causing the value to crash.
There is no benefit to crypto other than for illegal activities like money laundering and for scamming people. It would be stupid to take out a loan denominated in crypto as it could increase in value. So businesses will never be financed in crypto which means it’s inconvenient for business to pay employees in crypto, which means it’s inconvenient for those employees to buy legit products in crypto. The whole point of currency is to make transactions more convenient and crypto fails at that because borrowing crypto would be stupid.
So it’s not real currency and never will be because the libertarian concept of money that has increasing value doesn’t work for financing and therefore won’t work in a capitalist society.