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Cryptocurrencies lost $20 billion of value overnight

Basically, don’t use them to pay for stuff, but they’re as good as horses to bet on.

Basically, don’t use them to pay for stuff, but they’re as good as horses to bet on.

What it means: Cryptocurrencies, online-only money that isn’t controlled by any government or central bank, are now worth $20 billion less than they were a couple of days ago.

Lots of people are treating this as NBD, because the values of cryptocurrencies like Bitcoin have rocketed all over the place since they were invented. What goes down (may) come up.

But it's not very useful for a thing that people are supposed to be able to use to pay for stuff. Currencies have to be reasonably consistent in their value to work as a means of exchange, otherwise a pint of milk could cost you £1 one day and £50 the next.

So nobody is really using cryptocurrency as currency, not least because loads of businesses refuse to accept it. But lots of people are using it as a speculative investment - basically, they’re placing bets on whether the value of various cryptocurrencies will go up or down. As a money-making method, it could make you a millionaire. But so could the Grand National.

Cryptocurrency-as-currency might not be completely down and out, however. Venezuela has just made a cryptocurrency legal tender. That would be better news for crypto-fans if Venezuela wasn't widely considered to be pretty terrible at understanding how money works. But hey, it's a start.

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Reader Comments

  • RW

    Your right to a degree. You mentioned “the wandering Jew”.

    I elaborate that the Jewish people, historically have tended to migrate almost exclusively to locations that are economically and culturally vibrant already. I would speculate that Jews have thrived in these places and have often improved the bounds of their economies and knowledge base.

    You can also ask; how many massive entertainment conglomerates, Nobel winners or billionaires has Isreal developed? If Jews are so capable, why isn’t Tel Aviv the Rome of our time?

    Jews are successful because they value education, maintain a strong social cohesive, they actively monitor and have a good sense for Zeitgeist wherever they are and they carefully choose the places they settle and congregate themselves heavily in these choice locations.

    But most importantly (haulocaust increased the importance of this aspect), they actually designed their culture for success. They not only attend Harvard, they use what they learned to better the group as a whole. With as much, they studied intricate networking systems, adapted to it and in many cases improved upon them. (See how Japan acquired Aegis warships and made them better).

    Of course there is nothing wrong with any of this. It’s when you elaborately gain disproportionate power in any society where you would stand out, you must take care when attempting to make a society better (Civil Rights movement) and rewriting that society all together (mass immigration). Ask blacks in China, Mexico, Philippines or India how much opportunity they have? Go to businesses owned by their American diaspora and see how many blacks they hire. Go to Silicon Valley and see how many East or South Asian tech workers wish they could work with more black people. California might work as a state, but as a nation, I think your rolling the nuclear dice here. I hope we can succeed as a tolerant pluralistic superpower but at this stage in human societal development, it’s a pipe dream.

    And if Jews really are the icon for success, they would see that fundamental human successes happen over generations. Just look at the rest of the planet? Are we ready?