Things that do not work out in crypto after 14 years of its creation
Hey, I tried some fun approaches to my writing to ask AI and chat with it. Then I wrote my thoughts after. Hope you enjoy it!
2022 is a real test of crypto and it turns out many things that previously assumed were not working as the crypto intended to be.
Before I went into detail, I asked ChatGPT AI to see what was working and what was not. Here is the response:
What is working:
It's difficult to say exactly what is "working" for the cryptocurrency industry as a whole, as it is a rapidly evolving and dynamic field. In general, the adoption and use of cryptocurrencies has been increasing over the past few years, with more and more businesses, individuals, and organizations using them for a variety of purposes.
Some of the factors that have contributed to the growth of the cryptocurrency industry include:
The increasing use and acceptance of cryptocurrencies as a legitimate form of payment or store of value.
The development of decentralized finance (DeFi) platforms, which allow for the creation of financial products and services on blockchain technology.
The increasing mainstream adoption of blockchain technology and its potential use cases in a variety of industries.
The development of regulatory frameworks for cryptocurrencies in various countries, which has helped to increase confidence and stability in the market.
Overall, the cryptocurrency industry is still in its early stages and it is difficult to predict exactly how it will evolve in the future. However, it has shown significant growth and potential in recent years and is likely to continue to play a significant role in the world of finance and technology.
What is not working:
There are several challenges and issues that have faced the cryptocurrency industry in recent years:
Volatility: Many cryptocurrencies have experienced significant price volatility, which can make them risky for investors and make it difficult for them to be used as a reliable store of value.
Lack of regulation: The lack of clear and consistent regulatory frameworks for cryptocurrencies in many countries has caused uncertainty and raised concerns about the potential for fraud and abuse.
Limited adoption: While cryptocurrencies have seen some mainstream adoption, they are still not widely accepted as a form of payment and are not as widely used as traditional currencies.
Security risks: Cryptocurrencies and the infrastructure supporting them, such as exchanges and wallets, have been targeted by hackers and scammers, which has raised concerns about their security and the potential for losses.
Environmental concerns: The energy consumption associated with cryptocurrency mining has raised concerns about its environmental impact.
Overall, while the cryptocurrency industry has made significant progress in recent years, it still faces a number of challenges that need to be addressed in order for it to reach its full potential.
Okay! Now it is my term to tell what is not working from my experience.
First, the valuation of the crypto cannot be sustainable.
I meant the price will not continue going up without any evidence of proven.
During 2022, inflation was high and it affected the crypto market significantly despite the fact that the creation of Bitcoin was inflation resistance.
Bitcoin was down more than 70% from 2021 high, and it did not survive well in 2022.
Second, decentralization is a myth.
Yes, decentralization is wonder but it did not play well in 2022. Crypto exchanges are centralized more than ever. Decentralization has claimed the solution of centralization but it did not behave as it was designed and intended to be and many crypto applications and exchanges started to fall after.
Third, crypto leveraging is and will not work.
Crypto is risky and speculative. Using crypto as a loan is a disaster and borrowing money to buy crypto is horrible. The crypto market can drop quicker than the traditional market, which makes the crypto unreliable to become a loan.
Fourth, regulation is tricky.
You do not want to regulate crypto like traditional finance which will diminish the potential of the crypto. But regulations may still need to protect users and investors from the bad characters.
Above are those that were not working in 2022.
What was working is the crypto application like payment system and potential usage of signature verification like NFT and defi application that required audit constantly to ensure the financial product is on check.
So, what do you think about crypto after 2022?
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