Why crypto-currency will NEVER work!
We are talking about digital money, the money of the future, decentralized, secure, state-of-the-art, middle finger to the fiat money — “cryptocurrency”!
Well, not so fast.
Crypto is digital because it’s invisible; futuristic because it’s the newest- same as hyperloop — cool but useless at this point!
When was the last time you bought coffee using crypto? — never, because crypto has no value to the coffeemaker. He doesn’t have a crypto wallet, not because it is impossible to have but for more complex reasons, some of which I’ll explain later. The coffeemaker needs hard cash or at least a guarantee by the bank that is backed by a government that is somehow backed by the world’s financial system.
There are a few caveats about cryptocurrency.
Crypto as an asset
There are more than 9000 different types of cryptocurrencies (source link), some say more than 20000! Do you know how many real (fiat) currencies are there in the world? Only 180, recognized as legal tender in United Nations (UN) member states (source link). Sure there is inflation and all, but what are the odds that you wake up one day and see a few fiat currencies are dead? Virtually none! — a stark difference from the pool of thousands of cryptocurrencies named after every living or dead object you can find (e.g., potcoin, mooncoin, putincoin.. you name it!).
Decentralized lie
Crypto is touted as decentralized, and free from government control. What a fad!
In reality, any crypto exchange (call it crypto banks) can be subjected to government scrutiny or restrictions, computer-based decentralization doesn’t help. See this list to find out which countries have banned cryptocurrencies. You are virtually buying air for your hard-earned money.
Not for everyone
63.1% of the world’s population has internet access (source), I’m sure a lot of them are just casual social media users. On the contrary, 69% of “adults” have direct banking access globally (source). Banking is decades older than the Internet. It’s not the case that people do not trust banking, it’s just they are not feeling the need for it yet. Also, the incentive for users to start using the internet for asset transactions is just not high enough, banking is far more accessible and easy to use.
Securely insecure
A secured transaction is regarded as a supreme feature of cryptocurrencies, so supreme to the point that it is harmful to its own good.
For example, if you send crypto to the wrong address (an example of crypto address: 1N5GM5srG3CmDuUM7vjEKnqG6t4mTpY2Gr, this is my Bitcoin address in BTC network — already an obscenely long string of gibberish letters and numbers), your crypto is just gone, puff!
Moreover, different exchanges use different networks of blockchain which makes the system even more complicated. For example, if you send any crypto from one network to another network, if the receiver exchange does not support that network, your crypto is gone too!
Simply put, if you send the crypto USDT from the Binance exchange (supports BSC network) to a USDT address of the Coinbase exchange (supports ERC-20 network), you will lose your crypto in the air, even if the receiver’s address is correct. Not even exchanges can help you retrieve your money due to the inherent nature of blockchain technology. See this link for more. Many veteran people (crypto geeks) make this mistake, what makes you think it would be any easier for common people?
I do not know how you can call it a “secure” system. How would you feel if you sent US dollars from an EU bank to a UK bank, and the next thing you know that you cannot withdraw the money since the UK bank does not have access to SWIFT? In an extreme case, even if you make a mistake in transfer orders, or if the bank doesn’t have access to a certain network (e.g., SWIFT), there is a high chance that your money will bounce back to the sender's account; or at least, you will be able to retrieve the funds. But this is not the case for cryptocurrencies.
Opaque transparency
This is the most important of all. I understand that you do not trust the banks because of those corrupt people behind the curtain; then why on earth would you trust crypto that also has “people” behind with the same fraudulent behavioural intentions and human instincts, sometimes even more harmful and aggressive than those capitalists?
If you can swallow the issues above and are happy with the already existing concerns related to (but not limited to) the “depreciating value of crypto, ultra-volatile market, crypto-for-fiat system, incompatible networks, unorganized, unregulated markets, scammers, hackers, hard-to-understand technicalities, slow transaction, high exchange commissions, environmental issues related to crypto mining, unprecedented financial risks” — then of course! Welcome to the future of cryptocurrency (if there is any at all) §#
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