Gordon Freeman enjoys his research, trading, accounting, saving the world from the occasional future-Nazi tyrant... but every once in a while, a week like this past week comes along, and it strengthens everything you think you think about what you think you know.
I am not a Bitcoin maximalist. I've studied every prior coin that has made it in and out of the top 300 sorted by market capitalization, number of users, number of exchanges, long-term averages where applicable, and most importantly the team. Most most important... my gut when I review the website, TG group and actual milestone progress.
Things have gotten over-the-top ridiculous. 2020 was bad enough. This year is undeniable; the year I.Q.'s went negative.
People have mastered the art of being led around by trends that are scientifically proven to turn off brain cells, and it is working. Like, global economy working. This is so disturbing on numerous levels, and my tendency (like you don't already know) is to wish to list them all at once. I can't do that. What I do want to focus on instead, is the positive impact I'm attempting to focus on in reaction to negative trends.
The very ideals of cryptocurrency have been susceptible to hypocrisy for many years. I have poked a few holes in these ideals in my time. The origin is pure, motives pure, math in some cases close to pure. But, I've always argued that at the end of the day we are talking about inventions as they interact with human nature.
We are not nearly as noble as I wish us to be. I work at that in my own character. Sometimes I succeed. Sometimes I repent and hit reboot. We all have to be reminded one time or another to think big picture, to think long term.
I've spent a lot of time and thought looking at angles on the importance of trading, volume, and liquidity. These things matter in any form of economic flow models. Anything that is not transacting is a dead form of value and currency. There has always been a contrast in people's minds, defending the HODL in crypto against the evils of taking profit. The truth of the matter, is that there is a greater evil that unites us all in the quest for the success of crypto. Of course, there is government overreach and regulation. There are the central banks we can all agree should take a hike, and there are the manipulative whales who move markets with such force one has to question whether it should even be allowed. But, I place the blame for the biggest sins against cryptocurrency idealism in the hands of newbie followers. This may be fun, but it is not a game.
So, here it is. I want to look at a few important ideals about cryptocurrency that matter for various reasons. Then, I want to identify why substance matters so much more than what the market appreciates about it.
First, decentralization. Many crypto projects believe that built-in voting democratizes their projects and this is a good thing. I do not agree. I do not believe that is necessarily what decentralizes a network, because tyrannical governments love to use the democratization narrative to manipulate large masses of people in a singular direction. Really since Gandhi and India there hasn't been a truly pure political uprising that didn't have an evil shadow controlling the voice of opposition, where the new boss is 10X worse than the one overthrown. If a team of coders make a cryptocurrency, and they want people to trust it, sorry but centralization is among the values that are required, in order for there to be a facade of decentralization. You can then have the code analyzed and proven to be fair to a network of users and miners or stakers or whatever. Protection from 51% attacks, good economic flow models, powerful alliances with exchanges... all of these spread the value of a currency outward and it is the usefulness and relevance of the currency that makes it safer by decentralization, not a coded-voting system.
Secondly, privacy. OH, there are so many issues with privacy where does a person evens start? The idea of a public ledger to keep the entire system honest, matched to the ability to code private use in wallets that are owned and maintained by the user and not by account platform owners is great, but flawed. The mere fact that we have 3 options for how to run this doesn't seem to concern most people. You have Linux, Windows and Mac. That's all. How much do you, should we all, trust ANY of these options? Yet, we've had since 1990 to come up with better solutions and no one with meaningful results is breaking through the public consciousness with better solutions. At the end of the day, if you cannot guarantee anonymity at the operating-system level, at the IP level, reliant on the VPN provider, at a known code level, TRUST ME there is no such thing as privacy. But, if the intention is that every transaction can be perfectly analyzed and verified, quickly cheaply sent, and no one has to know the owner, that is a good plan. Then it becomes about the free speech (pseudo) rights everyone has to talk about their favorite projects and manipulate people into their corner.
There are serious world-changing technologies at play and top projects making good on these ideals for years.
We have all waited for mass adoption for years, and a few of us wishing for more influence have labored at different angles to help push that along, but truthfully and willfully we placed that in the very hands we are supposed to seek refuge from. The evil genius billionaires, central banks and governments.
Great job crypto community! lol
What is worse; Doge coin is the champion of the generation. Sorry man, but you guys have blown it, and badly.
The meme coin begun as a joke, has been abandoned by its originator, taken over by a few competent coders who now have the enlisted help of Elon Musk to rebrand the code into a green version of Bitcoin. Now, Doge is going to get pumped into eternity and truly could end up being the world reserve currency and it is a dumb, dumb, dumb thing to let happen. The only thing that would concern me more than never knowing the true intentions of Satoshi Nakamoto is to know for sure that the master of the universe is in charge of a one world NWO Dog. It isn't a good thing.
So, the fact that I am a trader and I am against wildly out of control pumping, should let you know I am serious.
Elon has now become the Bill Gates of crypto, the future of travel, the future of upgrading brains, and the future of habitation on other planets.
Lemme remind you of something we all agreed mattered in crypto:
If you could even take a project from scratch and make it the best economic model and make it super massively decentralized, unload it on the world and hand select 20 of the most noble, pure-soul coders on the planet to update and protect its code and network security, you would want to protect it from a 51% attack, protect it from the double-spend, protect it from the future potential fears of supercomputers or quantum computing hacks. The mere fact that Elon, who certainly understands all of this including the principles better than most of us, is hand-picking a coin based in recognizability and cuteness popularity, knowing that the project is abandoned by the creator, and that creator has also warned the public that Elon is a bad dude, and you have to understand there is a very dangerous game being played in the market right now. It is going to play out over years as well.
To me, the safest form of a diversified portfolio is a top-30 coins at best. This time, it is not based on those figures above. I have to take the project seriously, which means to me I have to believe the developers take the project seriously as well. I would never place this much hard work and research on whether something is pancake fresh, unicorn pink cute, or doggy pic adorable. I love all of these elements to the culture clashes of crypto, but I'm watching to see how Ethereum plays out. As much as I disagree with so many elements of Vitalik's approach, I appreciate his long, patient path to improving the network and we will see if any of it works. Meanwhile, ETH pumped to ATH alongside the Doge madness. That was based in more old school confidence and actual economic volume and that works for me. Though I am not massively confident in Charlie, I do like the patience and sound design of Litecoin but I have zero expectations beyond its eventual bumping up against its scarcity.
I believe in Bitcoin because of its 11+ year resilience despite all of the crap and massive dumps. More than this, people who know things better than I, have some confidence in the current team of coders, and as long as the U.N. doesn't order a hit on them and replace them with Elon green hippy plants we should be okay for a little while. Bitcoin is expected to land in every bank account, every PP address, Venmo, marketplace finally, and all of the top investment firms will be offering exposure to Bitcoin, whether the customer owns it directly or just gets to gamble on the price. The latter slows down the actual value growth of Bitcoin, but does also secure the value in its existence.
When $50-60 Billion of people's cumulative financial efforts are involved in trading Doge, with so little knowledge about it, with so little concern about the economic fallout and impact, playing this like confident tweets are all it takes for things like this to work, is some of the worst signalling on the path of our culture I have ever seen. You thought the absurdity of billions of dollars in Bitcoin without knowing a single thing for certain about its founder is bad, look where we are now!
I care more about decentralization, security, privacy, knowledge of reasons to remain confident in the jurisdiction and future path of my investments than I ever did before this ridiculousness stepped up a level.
The shilling is worse this time around, compared to 2018. The lack of depth in the blind followers is worse. The overall education about projects is SO much worse. The fact that people are so easily scammed in Telegram is much worse.
2020 clearly was not a good year for people to chill at home and exercise their minds.
I think I've earned a little bit of cred to complain about these things. 2020 for Gordon, was one of the worst years of my life. The virus and society shutting down was nothing compared to the devastation I faced. It was a one, two, three punch of terrible situations and I recovered, I rescued my assets, and I have traded at nearly 100% accuracy for over 1 year now. My only HODLs are unintentional, and they are all in Bitcoin. I am not a Bitcoin maxi, but by process of elimination, I do not trust Ver or Wright, thus I have zero interest in the price action of BCH or BSV. I do not know whether ETH will get killed on its path to 2.0. I don't know if Charlie needs to actually be involved in making LTC future proof or if its okay long term. But, those are the ones I trust more than the rest.
I will not be surprised to see Dash, Digibyte, LINK, and other favorites do their thing in years to come. I may even enter into some side HODL's or not. I haven't decided. But, even if Doge takes over the entire economy, you will not find me lending support to this joke of an economy. I have absolutely NO problem with anyone that loves Doge. I love Doge. It is cute. It is fun. It is funny. I love the funny sayings, the awesome memes. Write in my comments about how wrong I am about it- I don't care. I would rather be wrong for all of the right reasons, than to risk this much good intelligent planning on something so radically improperly handled. You know, if I see an unbelievably obvious dip in Doge and I know I might grab 1-2% off of it, I might even be willing to do so just like any call I've made in the past. If I have 0% worry about liquidity at the time of a correct call, I will not get stuck and I will get my profit. At this point it is guaranteed. But, HODL it? Zero chance. Trade Doge consistently for more gainz? No. Follow the path of Doge clone meme coins? Stop asking me already. This is not investing. This is not trading. You are confusing your time on social media with other hobbies. Best advice, get your money out of the way and do something else with it. If you made your millions in Doge and you still don't understand the risk, please don't call yourself a millionaire. You won't be for long.
I may sound twitchy with angst. It's not really that bad- lol.
Like I said, this has been QUITE a week! I am genuinely concerned about the outcome of a bloated market doing some of the trends I see it doing.
So, I revert to some of the ideals that I truly believe matter in the world of cryptocurrencies. Lack of centralized control matters. Resilience to manipulation matters. Some form of desired privacy matters. Fast transactions without a mediator matters. Reliability matters. In the case that someone DOES make a mistake, the ability to get on-chain assistance by some kinda human somewhere is a good thing, not a bad thing.
Now, some of the most important things to me are the level at which the outside world is incorporating assets, not because I believe in their ideals, I don't, but it is the very thing that protects the future of projects from regulatory assassination. If banks need it, it will remain. If investment firms provide it to their clients, it will remain. Next will come CBDC's and if they fail it's good for all of us. Most likely, the top 4 coins will reside next to CBCD's and it will get rocky but it will work.
So, Gordon is going to make a prediction, and he prays it does not come true. This is the grand finale.
If what I suspect is happening is true, as I've stated in the past, there is a REASON that Mark Cuban and Elon are riding the Doge bus. Understanding that there is a team, and they are taking Elon's expertise to improve the network, one has to wonder if they are also listening to his advice to change the model. They are not the project originators, so they can do what they think is right. Elon may be very good at convincing people of this notion. Change the inflationary model to one of scarcity while it becomes cheaper to transact faster, and you will in fact have a Bitcoin killer. If they are easily led, they are easily misled, and if this happens, we will see Elon become the first trillionaire, and many fools who entered crypto late, who still don't know anything about anything, and technically don't own ANY Doge at all because it all resides on Robinhood, will becomes actual millionaires, some billionaires, and are at risk to immediately lose it in the very next decision made. It is about manipulation at that point, and at that level.
So, take it from someone who cares: if a day trader tells you that more matters about a coin than how high it pumps, please trust me it is true. The longer this foolishness goes on, the more it increases the likelihood of bad end results.
We are finally entering the time we all have waited for. The true reckoning of long-living projects is upon us, and once these values are able to take on their market positions, nothing will be the same. But, the current cartoon of currency runs the risk of devastating the economy, and those involved find it a fun game to play in place of Overwatch or whatever comes next. Trust me, I love Half Life 2 and what it opened new worlds to! But, when it comes to investments and the actual fragility of global economics, we are seeing a bad wave hitting. My hope is just for the Dunes ashore to survive.
And on that note, a cautious and hopeful Gordon Freeman... out.