As is my habit each morning I run through a serious of Google Alerts scanning and reading those that tweak my interest. One of these alerts helps me to stay abreast of what is happening in the crypto market. Most often times the articles present the hype and expectation of those enamored with Bitcoin and the excitement the last ten years of cryptocurrency excitement has wrought.
One article’s conclusion deserves a bit more thought.
There’s a lot of money to be made in cryptocurrency, but it belongs to those who can avoid making ruinous mistakes.
Whether you’re trading or mining, it is important to treat your endeavor with the utmost care and diligence.
As a crypto newcomer, you will go much farther and enjoy success if you note these tech-mistakes and steer clear of them.
This middle sentence once again reinforces my skepticism.
What is behind these immaterial assets?
Is the price of a bitcoin simply the result of the actions of crypto believers, speculators, and gamblers?
Is a cryptocurrencies price driven by the value of the reward required by miners to cover their cost for electric, space and computer resources?
Unlike the US dollar, the British pound, Swiss Franc or other stable country issued currency built on “trust” in the future of the USA, UK or Switzerland; these new currencies are built on peoples’ belief in a speculative and trustless cryptographic universe.
In essence, these cryptocurrencies are built on
The hopes and dreams of many
Behind all of this is the cost of supporting these cryptocurrencies. Costs measured in electric bills and the investment in racks of mining resources “computers”. Is it the ever-increasing need for computation power that drives the ever-increasing need for higher rewards set against the process of halving, apparently designed to address inflation.
This mystery of “inflation” leaves me wondering if inflation of the price a built-in part of a scheme to assure the original and still invested success of the few?