If you think cryptos are a risky investment look at this chart...
This is total global debt, 327% of global GDP, a massive $217 Trillion.
As far as I'm aware this doesn't include liabilities (things that need to be paid for like pensions and infrastructure projects).
In other words we're all fucked. Not gently eye-to-eye contact with rose petals on the bed sheets fucked, but can't sit down for a week "I think that bastard used swarfega as a lubricant" fucked. There's no money left to repay debts without a massive printing and devaluation of fiat currencies.
That means that despite all of this "bubble" talk of cryptos, the opposite could be true.
I think a lot of people in the financial world still think of Bitcoin as Tulip Mania. That one day we'll all look back on this and laugh "remember when people used to burn out graphics cards mining Bitcoin?"
This seems like they're worrying about the twigs in our eyes and not the logs in theirs. Particularly as the world learnt nothing from the 2008 crash and are carrying on as before. Mortgage backed securities based on dodgy mortgages are once again back in vogue.
https://steemit.com/news/@purpleprose/so-you-screwed-the-world-over-once-why-not-try-it-again
Will Bitcoin and other alts crash?
Yes, time and time again but most of the problems fiats have, we don't. There's no complex financial instruments based on debt, leverage for trading is provided by other users rather than conjured out of thin air and there's no central bank to print our coins away.
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When the next fiat money crash happens, cryptocurrencies will soar. The shitcoins may not survive but coins like Ethereum, Bitcoin and Litecoin are likely here to stay. There will be a lot of push back from governments and bankers, but if it's survival of the fittest, we're in far better shape than they are.
The leading cryptos will persist for sure. I count Steem among them. Check out why: https://steemit.com/steemit/@godfish/full-steem-ahead
I agree, being backed by a social media network counts for a lot, I will read your post later.
The reason crypto is still considered high risk investment (and should be for portfolio building purposes) is because the technology is still in very early stages, some of these coins are basically nothing more than white paper promises. Even on the bitcoin github it still says "Bitcoin is an experimental digital currency".
This is the reason I believe Bitcoin is increasing in price, the longer it operates without compromise the more it has proven itself the less risky it becomes. Most coins have not proven anything and if recent events in the security scene has shown us anything it is just a matter of time before the weaker coins fail to security flaws (we have seen this already).
The bubble talk should only be for short term traders. I am not concerned with bubble talk at all. In 10 years this will be nothing more than a little blip on graph.
I agree.
"Most coins have not proven anything and if recent events in the security scene has shown us anything it is just a matter of time before the weaker coins fail to security flaws (we have seen this already)."
That's why I think a lot of alts will die off, leaving only the strong. There's also far too many of them, seems like there's new ones springing up daily, traders will get sick of it and stick to only the well-known, well-established. Unless they have something behind them like Steem.
Insightful article. I liked the line "but most of the problems fiats have, we don't. " and they way you used "we" for cryptocurrencies ;)
Feels bad to see that this article has only 4 upvotes. Upvoting and reposting. Keep such good articles coming.
Hey thanks, it's nice knowing at least someone's reading.
Waiting for Hyperbitcoinisation.
I don't know what that means...so I'll just nod and say "yep, me too".
Apologies. A retry.
Hyperbitcoinisation.
Ah, I get it, thanks for clarifying.