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Crypto has never gone through a major economic crisis and when there were short term panics it always dropped significantly. Being without a central bank also m
by rapsey 5y ago
Crypto has never gone through a major economic crisis and when there were short term panics it always dropped significantly. Being without a central bank also means there is no limit to how far it can drop.
- raptorraver 5y agoDo you mean there haven't been major economic crisis related cryptocurrencies or we don't know what happens to cryptos if (and when) a major, general economic crisis happens in the world? I'm interested in what would happen in the latter case. Probably cryptos would crash even harder but are there cases where people would trust cryptos more than cash in crisis?
- rapsey 5y agoIn a general one. In a general crash everything tends to drop because everyone is selling assets to cover debts. I can't see crypto doing anything other than drop more than anything has ever dropped. It would recover later probably if investor confidence is not completely destroyed. Because as we all know, the entire space is still completely without any real world use case and entirely useless other than speculation.
- gpt5 5y agoTo be fair, as regularly seen in smaller economies - regular money also tends to show no limit to how far it can drop during economic crisis.
- rapsey 5y agoCrypto is a speculative asset. It was made and promoted itself as money but failed completely in that aspect.
- lamp987 5y agoExcept Monero. Funnily enough, Monero is the crypto that failed as speculative asset.
- thow-58d4e8b 5y agoIt's a similar story with Nano, and it de-masks the true nature of this mania On paper, it's a perfect crypto. Really fast and fee-less transactions, proof of stake avoids the environmental impacts, completely pre-mined, distributed as equitably as you reasonably can, and truly decentralized. But it has one major flaw - no way to get rich quick. No celebrity hyping it up. Nobody is "in it for the tech", it's all a glorified game of chicken
- frankbreetz 5y agoCouldn't you get rich off Nano the same way you get rich off bitcoin? By buying some and then convincing others to spend more on it then you did?
- imtringued 5y agoFreicoin was invented earlier and died faster than any other cryptocurrency. In my opinion the idea of an anti speculation cryptocurrency failing is exposing the entire cryptocurrency space for what it is: gambling.
- wesleywt 5y agoHow has it failed?
- djokkataja 5y agoIt's less useful as money because so many people use it as a speculative asset.
- rapsey 5y agoA useful currency requires at least some reasonable level of price stability. How popular is crypto becoming as a payment mechanism? From what I see it is actually becoming less popular with time. I saw options to pay with crypto way more a few years ago.
- wesleywt 5y agoIntervention by the Central Bank is not a good thing. There are a few economist who are warning against the lack of moral hazard currently pervasive in the Traditional Finance sector. Crypto will be the refuge from aggressive monetary policy going tits up. Aka like in 2008.
- rapsey 5y agoMany decades of economic growth speaks for the current economic model. A saying goes: pessimists get to be right, optimists get to be rich.
- omgwtfbyobbq 5y agoAnother saying goes: Past performance is not indicative of future growth. YMMV...
- rapsey 5y agoWith a good money printer growth is guaranteed.
- omgwtfbyobbq 5y agoWell, real growth. ;)
- omgwtfbyobbq 5y agoMy sense is that crypto would also go tits up. I don't disagree about problems with traditional finance, but I think that asset valuations, including crypto, benefit from those problems.
- ekianjo 5y ago> never gone through a major economic crisis COVID and the massive supply of dollars since last year is not one?
- rapsey 5y agoNo
- graeme 5y agoNo, those two things go in opposite directions. During the march 2020 plunge crypto fell more than the S and P I think In a general recession with declining asset values crypto would likely fall more than general assets, and also risks simply having a massive plunge if Tether breaks at the same time.
- rapsey 5y agoWhatever actual assets there are in Tether they have on the record said is in speculative assets. In a crisis tether goes up in smoke.