Cyrpto is bubble
Yes, I know this is not going to be a popular opinion, but that never stopped me. Also if we look around hive and splinterlands, it surely doesn't feel like a bubble. Yes, that is correct, I am talking about greater crypto, BTC, ETH etc. So what is a bubble, let us first define it, as everyone's understanding is slightly different:
A financial bubble, also known as a speculative bubble or an asset bubble, is an economic cycle characterized by a rapid increase in the price of assets, followed by a sharp decline in value.This phenomenon occurs when the price of an asset, such as stocks, real estate, or commodities, rises significantly above its intrinsic value, driven by speculation and irrational exuberance rather than underlying fundamentals.
Now that the term bubble is defined, let us focus on crypto. Most people in this space will say that crypto bull market is only getting started. I would agree with them. However, that doesn't mean it is NOT a bubble. One of the critical element of defining a bubble is to first understand the 'intrinsic value' of the asset in question. In case of crypto it is not easy to define and there lies the problem. Lets try regardless to put some value into the crypto world:
- Decentralization. Lack of single point of failure
- Rare (at least in case of BTC)
- Store of value
- Alternative currency without govt. control
- Tokenized world: a token/NFT for everything
- Fast feeless (not really, most crypto are not as fast as fiat, and certainly not free)
I can increase the list a lot longer, but it is useless. The problem is, how many alternate currencies do we need? 10, 100? Certainly not 1000! There are not 1000 federal governments in the world, so there are no possibility of 1000 real world currency. However, as per coinmarketcap, there are thousands of crypto with with total marketcap of $3.6T, but with BTC alone has a marketcap to ~$2T.
Did you notice we still 'value' the price of BTC in USD, and so with the marketcap. So my question to all the fiat-haters out there is, why? You say you don't need USD or fiat in general, so why every crypto is still priced in USD? Let me answer, because there is no substitute for USD. Thankfully all Splinterlands assets are priced in USD, have you ever imaged what would have happened if they were not? Let me answer again, Splinterlands would not have exist now.
I am not calling for death of BTC or crypto
I am very aware on how many times BTC death was called and it was all wrong.
https://99bitcoins.com/bitcoin-obituaries/
What I am saying, we need to start treating crypto like an asset. For every asset there is conventional meature of 'value' and 'utility', and 'regulation'. We need all three of those in crypto. If it remains wild west then it doesn't matter how smart you are you will fall into the trap, sooner or later. Even Sir Issac Newton couldn't avoid the allure of the South Sea Bubble. Please have a read.
It is high time to ignore memecoins, and 99% of the coins which has no utility. Only focus on the assets you need, sell everything else that doesn't do anything or trade on vaporware or false promise. Take profit now, and invest in a house, or land, or buy some bluechip stock on a dip. Thank me later.
