Marc Cuniberti: The Facts About Crypto


With the explosion in both investor interest and price promotions, cryptocurrency is a hot topic. Originally conceived as an alternative currency, Bitcoin was the first digital money to debut in 2009. Since then, over 4,000 different cyber coins have come onto the market. The appeal is that it supposedly cannot be manipulated or eliminated by any single person, organization, or government. The argument created and stored in cyberspace appeared to be valid.

There have been many overnight millionaire stories since its inception, and I hear more of those rags-to-riches stories every day. And it's not just about making a few dollars. If you want to believe what I'm told, more than a few acquaintances have made ungodly sums of money.

I have to admit, I can't say I fully understand how crypto works. I would guess a lot of his investors don't either.

What I can say is that this has all the trappings of a mania. From the excitement to the quick wins of the inexperienced to the price charts and to the "this time it's different" story - it smells like mania. And now maybe the sad late chapters of manias: they fall down, and usually hard.

I'm having problems with crypto. I have a small amount in a Wall Street vehicle rather than a phone app. There are many stories of investors who lost passwords or hacked apps resulting in lost funds. An investor portrayed in a Wall Street article was locked out of $ 100 million and had only two options to remember his 132-digit password before losing that fortune into the black hole of cyberspace.

And no, there is no one to call. Once locked, it's essentially gone forever.

Aside from the “too good to be true” aspects of all the stories and zillionaires overnight, Cybercoin, at least in its current form, will never function as a valid currency.

Currencies must have a variety of properties, the most important of which is "store of value". That said, when you take currency for something real, you need to be sure that the currency you received retains the value it had when you took it.

No problem you say? Will the price skyrocket at some point, if not overnight?

A skyrocketing price is not a store of value. Store of value must be in both directions. This means that both the buyer and the seller must not lose value in the transaction over time. Simply put, for every cyber coin winner there is a loser. Therefore, currencies must be stable and must not fluctuate in value and purchasing power.

It's a tough concept to digest as most investors think they'd love to take a cyber coin for payment. Ah, but would you cash one out to buy something?

A currency must be of relatively equal value over time to be a valid receipt for products or services, as that is a currency, a receipt of constant value.

Cyber-Coin is anything but stable in price. Just look at his run-up and finally his “run down” and I can't say I'm the least bit surprised.

Aside from the roller coaster action, a few other things bothers me about sinking thousands in cyber coins.

Elon Musk, the idiosyncratic founder of Tesla, appeared on Saturday Night Live and then tweeted two days later that Tesla would no longer accept bitcoins for the foreseeable future. That hammered Bitcoin down 12%.

I don't know about you, but I don't want tons of my hard-earned money to be wiped out when a single tweet or statement can crash them. It has halved in the past two weeks.

No thanks.

Since it is an indestructible cyberspace currency that no government can manipulate, governments do not need to be able to eliminate it.

All they have to do is prohibit its use and / or remove the apps that are trading with it. Bitcoin plunged 4% when the country Turkey banned its use as a means of payment. You are not the only one.

The following countries have banned, restricted or warned against the use of cyber coins in any form: Kyrgyzstan, Bolivia, Bangladesh, Iran, Nepal, Thailand, India, Denmark and Ecuador.

That list is sure to get longer as sovereign currencies, the government checkbooks, are threatened by the use of cyber coins. Just think about what would happen to the price if the US or some other major superpower took similar steps?

No thanks again.

One day the cyber coin could find its rightful place among monetary instruments, but right now it scares me.

Marc Cuniberti has a BA in Economics with Honors from San Diego State University and is the Money Matters hose worn at 66 stations nationwide. California Insurance LIc # 0L34249. Call him at 530-559-1214 or visit http://www.moneymanagementradio.com

https://dailyaffiliatemarketingnews.com/marc-cuniberti-the-facts-about-crypto/

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