Vulnerability of cryptocurrencies

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To put what's in the article in a nutshell:

1) Cryptocurrencies are unlikely to replace fiat currencies, simply because governments would not want them to. Why would gov want to give up their money-printing rights and agendas?

2) They are prone to facing regulatory challenges as what are happening now. Yes, now and in the near future.

3) They are prone to scalability issues and volatility.


Just look at those new regulations coming into place in some of the European countries as well as Korea (where even grannies and grandpas speculate cryptos). And it seemed not very difficult for governments to issue ban on cryptocurrencies either, for good reasons. 

Biden's recent tax hike proposal will also have an impact on both crypto and stocks markets (crypto gains are taxable in the US). 
(Hot fiat moving to fund crypto economy? Hmm... better to take some back.)


What does it mean for bitcoin?


What I can say is... it is a cryptocurrency.


Should I "invest" in bitcoin now?


As I used to say, we cannot drive looking at the rearview mirror. There's pull factors and there's push factors. These dynamically changes, which would affect its overall market demand level.
Go figure.


*clap clap clap*



How about its status as "digital gold"?



In a nutshell:
In order to replace gold, bitcoin should exhibit the same attribute as gold, except for the tangibility part. However, in times of bad crisis, its volatility can be reflective of the stock market's volatility.
(Correlation often depends on what timeframe you are looking at.)


Photo by Launchpresso on Unsplash



However, looking at the crypto space through only cryptocurrencies is like looking at a world through a tiny window. There are many opportunities and types of cryptos out there in the nascent space. 


To quote from someone, cryptos are available in

the currency types (we just mentioned)

the platform types

the governance types

the security types

the utility types

the fund types

and last but not least...
the meme types (aka Dogecoin shit coins)



So you can see that cryptos are NOT created equal.

For those who still think crypto=bitcoin, please be woke! It is crucial for those who want to venture into the space to keep both eyes open to differentiate between the types and their functions. 


Of course, I shall leave that to your own reading pleasure.


Do check out this good read Tech Dollar and my other cryptocurrency posts!


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Thanks for reading!

Disclaimer: Contents of this blog are personal opinions and NOT financial advice to buy or sell any mentioned securities, commodities or assets.


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The contents of this blog are author's personal opinions and do not constitute advice to hold, buy or sell any securities, commodities or assets mentioned. I do not guarantee the accuracy and reliability of any information provided, and shall not be liable for any losses incurred from reading my posts or using the materials herein. This blog may contain affiliate links to external sites.