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Truth and Lies About Bitcoin, Cryptocurrency and a Turbulent Economy

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Unless you’ve been hiding under a rock, I’m sure you’re aware of just how much the global economy — including the US economy — has been chaotic and volatile in the course of this still very young 2022.

Things were pretty shaky to begin with — on account of the Covid impact and what thereof follows — and the Russia/Ukraine conflict has now added more fuel to that particular fire.

In trying to keep up with the news and the swiftly changing financial landscape, one of the surprising things I’ve noticed recently is a number of references to the strengthening US Dollar vs. the remainder of the world’s fiat currencies. Economists like to refer to this as a ”flight to quality,” for whatever that’s worth.

What Does That MEAN?

Considering this also made me pause and think about the frequent assertions of the Cryptosphere that Bitcoin — and perhaps certain other cryptos — represent a “better store of value than legacy fiat currencies.”

And now we are sitting here on March 7th, and the US Dollar is UP on the year against most major currencies, while BTC has lost some 16% of its value in 2022.

I’m not writing this as a criticism of cryptocurrencies themselves, but more as a commentary on what the Cryptosphere has done to itself.

So we know that the "safe haven" US Dollar is up on the year. For comparison’s sake, the Dow Jones Index (DJIA) is down just under 10% in 2022. That represents large cap so-called ”blue chip” stocks; considered stable, reliable, relative safe as investments go. Meanwhile, the NASDAQ is down nearly 18% in 2020, and it represents technology and younger more innovative and risky companies.

The point I am getting to here is that — when faced with crisis and turbulence — BTC and the Cryptosphere is behaving far more like a high-risk security than a safe store of value.

Which brings to light one of the criticisms the mainstream often has, about what we’re doing: Cryptos aren’t ”alternative MONEY” they are exotic securities and investments.

And perhaps not nearly as "solid" as we like to think they are...

Just to Clarify...

Again, I still think cryptos are amazing and filled with potential, and will become a permanent part of the global economic future! And — in time — they may mature to the point where they look more like money and less like securities.

That said, be completely HONEST with yourself in answering the question: ”Why are you in crypto?”

Can you sincerely say ”to develop and USE it as the new money” or is the more honest answer ”to MAKE money?”

No worries! I don’t expect anyone to give me their actual answer here! I just invite you to consider your answer in the context of contemplating the ocean of red ink that has dominated the Cryptosphere during the first 65 days of 2022.

Thanks for reading, and have a great remainder of your week!

=^..^=

CuratorCat 07-MAR-2022

Posted Using LeoFinance Beta