Would you spend dollars for euros if you then knew for certain you could never âsellâ ( i.e. trade it for something else) your euros?
Could you elaborate on this analogy? I feel like this is supposed to be a point for crypto, in context, but this feels like itâs supporting my point. The answer to this is unequivocally ânoâ. The only reason I would want euros, or dollars for that matter, is so I could then buy something with it. Money that can never be spent is useless.
Right, Iâm trying to sayâjust like normal fiat currency, crypto is meant to be a money, itâs not an end in itself. So using the bar âI wouldnât buy this thing if I couldnât then trade it for something elseâ doesnât really make sense, because the whole point of the thing is that you can eventually trade it for something else.
The value in money is in its properties to facilitate store of value, unit of account, and unit of exchange. Crypto in principal can do these things.
Also, insofar as there is value in other blockchain based applications (e.g. DeFi), you need crypto in order to use those applications (for âgasâ to pay for transactions).
Also, you can use crypto/âblockchain to transact in dollarsâso called âstablecoinsâ. So you can get the international transfer benefits but without the natural volatility that occurs in crypto prices.
I may be overpleading the case here, but I feel like a big reason why there is default skepticism about crypto is that in most peopleâs minds, they think âcryptoâ equals âbitcoinâ.
Bitcoin makes up a plurality of total crypto market cap, but imo itâs generally boring, uninteresting, and not a particularly high potential part of the space. If crypto was just bitcoin, I wouldnât think that highly of it either. Bitcoin may still be able serve as a kind of âdigital goldâ, but that seems overall not that net positive or interesting.
Imo by far the most interesting part of the space is âsmart contract blockchainsâ, the most prominent being Ethereum. That is where the actual innovation and interesting potential use cases are.
Some examples (sorry for using specific projects, I feel like itâs easier to illustrate with concrete examples rather than abstractions):
Aave, the leading borrowing/âlending protocol. Users can earn yield on their assets and borrow loans against their collateral. Itâs basically a bank that runs entirely on code that anyone around the world can access 24â7.
Uniswap, the leading decentralized exchange. Users can swap assets or earn yield by providing liquidity for any token pair. Itâs basically an exchange that runs entirely on code that anyone around the world can access 24â7.
Lens, the leading decentralized social media protocol (this one is still very early, but it shows the potential of the technology). It enables Twitter/âFB style social networks, but where everything is on a blockchain so itâs impossible to censor or de-platform users, and users can take their followers/âfriends to other sites (instead of the current siloing we see in current social media platforms).
Proof of Humanity, a project that is trying to build a sybil-proof digital identification system that could enable things like a true global UBI (this project is also very early and I have no idea if it will actually end up being valuable).
There are hundreds, maybe thousands of projects like these that are building cool stuff enabled by blockchain and smart contracts.
Right, Iâm trying to sayâjust like normal fiat currency, crypto is meant to be a money, itâs not an end in itself. So using the bar âI wouldnât buy this thing if I couldnât then trade it for something elseâ doesnât really make sense, because the whole point of the thing is that you can eventually trade it for something else.
So, my understanding of your argument is that the ability to buy things with currency is literally the purpose of currencyâitâs a necessary but not sufficient condition for a valid cryptocurrency. Using it as a bar makes about as much sense as saying âI wouldnât buy a car if I couldnât drive it placesââtrue, but trivially obvious.
But in that case...are there cryptocurrencies where I can do this now? Can I buy cryptocurrency and then buy a useful assortment of things quickly and cheaply with it?
Could you elaborate on this analogy? I feel like this is supposed to be a point for crypto, in context, but this feels like itâs supporting my point. The answer to this is unequivocally ânoâ. The only reason I would want euros, or dollars for that matter, is so I could then buy something with it. Money that can never be spent is useless.
Right, Iâm trying to sayâjust like normal fiat currency, crypto is meant to be a money, itâs not an end in itself. So using the bar âI wouldnât buy this thing if I couldnât then trade it for something elseâ doesnât really make sense, because the whole point of the thing is that you can eventually trade it for something else.
The value in money is in its properties to facilitate store of value, unit of account, and unit of exchange. Crypto in principal can do these things.
Also, insofar as there is value in other blockchain based applications (e.g. DeFi), you need crypto in order to use those applications (for âgasâ to pay for transactions).
Also, you can use crypto/âblockchain to transact in dollarsâso called âstablecoinsâ. So you can get the international transfer benefits but without the natural volatility that occurs in crypto prices.
I may be overpleading the case here, but I feel like a big reason why there is default skepticism about crypto is that in most peopleâs minds, they think âcryptoâ equals âbitcoinâ.
Bitcoin makes up a plurality of total crypto market cap, but imo itâs generally boring, uninteresting, and not a particularly high potential part of the space. If crypto was just bitcoin, I wouldnât think that highly of it either. Bitcoin may still be able serve as a kind of âdigital goldâ, but that seems overall not that net positive or interesting.
Imo by far the most interesting part of the space is âsmart contract blockchainsâ, the most prominent being Ethereum. That is where the actual innovation and interesting potential use cases are.
Some examples (sorry for using specific projects, I feel like itâs easier to illustrate with concrete examples rather than abstractions):
Aave, the leading borrowing/âlending protocol. Users can earn yield on their assets and borrow loans against their collateral. Itâs basically a bank that runs entirely on code that anyone around the world can access 24â7.
Uniswap, the leading decentralized exchange. Users can swap assets or earn yield by providing liquidity for any token pair. Itâs basically an exchange that runs entirely on code that anyone around the world can access 24â7.
Lens, the leading decentralized social media protocol (this one is still very early, but it shows the potential of the technology). It enables Twitter/âFB style social networks, but where everything is on a blockchain so itâs impossible to censor or de-platform users, and users can take their followers/âfriends to other sites (instead of the current siloing we see in current social media platforms).
Proof of Humanity, a project that is trying to build a sybil-proof digital identification system that could enable things like a true global UBI (this project is also very early and I have no idea if it will actually end up being valuable).
There are hundreds, maybe thousands of projects like these that are building cool stuff enabled by blockchain and smart contracts.
So, my understanding of your argument is that the ability to buy things with currency is literally the purpose of currencyâitâs a necessary but not sufficient condition for a valid cryptocurrency. Using it as a bar makes about as much sense as saying âI wouldnât buy a car if I couldnât drive it placesââtrue, but trivially obvious.
But in that case...are there cryptocurrencies where I can do this now? Can I buy cryptocurrency and then buy a useful assortment of things quickly and cheaply with it?