A pillar of mainstream media reports that the crypto market is “frothy” and warns that crypto holdings value will be “wiped out”. It also states that the Fed’s “hawkish” statement on Wednesday may well accelerate the sell-off.
An article on Bloomberg yesterday talked about “parody coins”, celebrity-driven commercials, an NFT “frenzy”, and that the Federal Reserve statement on Wednesday would perhaps signal the end of the current crypto bull market.
Such a negative spin on crypto is unusual, even for mainstream media. A “waning interest” in crypto trading was highlighted, using trading volume data from Coinbase, and even the “greater fool” theory was applied to crypto, stating:
“It’s fine to buy overvalued assets as long as it will be possible to sell them for an even greater price. But diminishing trading activity suggests crypto markets are running out of fools.”
The article labelled the Fed’s Wednesday statement on how it was going to control inflation as “hawkish”. It might be argued that if you aren’t toeing the mainstream media party line, then the so-called “hawkish” Fed move might be considered negligent, or risible at best.
Yes, the Fed pumping slightly less currency into the system over time should have a negative effect on crypto. Less currency in the system means that there is less to spend on sound money such as certain cryptos, gold, and silver.
But, when all is said and done, the monetary system is broken beyond repair. No amount of extra currency pumped in, whether more, or less of it, is going to make a difference beyond the short term.
Trying to argue that the crypto market is an “amusement”, and that it is only there to make a very few people wealthy, while completely ruining the rest, is to try and tar it with the very same brush that must be applied to the current fiat monetary system.
Crypto has its failures and issues. That can certainly be argued. I agree with the article author that there are many crypto tokens that are only there as speculative assets to make money off of unwary investors.
However, to truly understand the complexities of even one of the cryptocurrencies, like Bitcoin for instance, might take a very long time to achieve, and it is understandable that many people might treat crypto with suspicion given the array of people with influence and power who have spoken out against it.
The answer to it all is education. There is no shame in not getting crypto. Many incredibly intelligent individuals (such as Michael Sayler for instance) have started out by ridiculing the industry.
Nevertheless, the deeper you dive, the more you find out, not just about crypto, but about the current financial system. The way things are headed, we either end up powerless in the grip of central bank digital currencies, or we embrace private money that is ours, and not the bank’s.
It’s incumbent on everyone to make this choice, to read around outside of the mainstream media, and to not get carried along with the herd. Some of us will continue to challenge mainstream thinking - what will you do?
