Creative destruction has become our new favourite buzzword. It also aptly describes this new wave or phenomenon of Crypto-mania driven by the blockchain and its shining star – the Bitcoin.
Suddenly, people who normally would not bat an eye at trading are now asking how to invest in Crypto.
We must note that anything that goes up very abruptly and abnormally – eventually comes tumbling down. The same way the big dot.com bubble burst and left many in dire straits after they over-indulged in overvalued tech companies.
Bitcoin will eventually find its peak and there will be a mass sell-out and a ‘crash’ at some point.
We even had the likes of an ironical skeptic – the dubious Ponzi-scammer dubbed ‘the Wolf of Wall Street’ Joel Belmont. He attempted to pre-empt a crash of Bitcoin.
The funny thing is, however, most of the critics are people who have not invested themselves. Perhaps they suffer from a case of ‘sour grapes’ or they simply don’t understand how it works to even get involved.
Doubt is prompted by fear of an unknown. Most investors themselves don’t understand the complex algorithms that went into designing the blockchain. However, it is proving to be resilient and gaining intrinsic value by the day.
A new industry borne
Bitcoin (at the time of writing), which was hovering around $17000 after breaking its latest resistance level, and poised to reach the $20000-mark.
Creative destruction does not result in the reinventing of the wheel. It does, however, make the previous version look ancient very quickly. So while Bitcoins may not even last long, it has brought about its add-ons or spill-over effects.
There are now hundreds of cryptocurrencies. While not all and most will not experience huge price surges like that of Bitcoin, Ethereum, or recently Dash, they are still in circulation.
One of the spill-over effect includes the creation of jobs for new entrepreneurs, gamers, and developers across the globe.
Though it might be too late for investors to delve into the above-mentioned ‘big boys of crypto’, institutions are constantly developing blockchain solutions.
The fact of the matter is that the use and process of a blockchain makes sense and will, and is in the process of removing the old currency system.
Now, this may take a while before it completely phases out fiat money. This will also hopefully, much to the delight of governments and fiscal authorities, help eradicate the scourge of counterfeiting.
Applications of blockchain
Think about the big picture, the blockchain technology will allow you or any institution smart enough to copy or modify a part of the anonymously written code. Blockchain is open-source, so anyone smart enough can create their own.
We can now have Crypto for shopping, for buying cars; getting your salary paid by a multi-national company irrespective of where you are based; or paying for using Internet services (IoT).
This technology can enable one to find creative ways to monetize a cryptocurrency to serve any purpose. This while providing a secure and lightning-quick means to transfer funds.
Litecoin and Dash boast amazing speeds of under 10 seconds to complete international money transfers.
It would be interesting to observe any bank try and beat that without charging an arm and leg for that type of service!
The motor industry
The critics, who thought Elon Musk was crazy for inventing electrically powered battery motors to run engines and now trucks – are now eating their shorts.
Not only did Tesla´s market capitalization beat that of Ford and recently BMW, but it also outperformed petro/diesel-powered vehicle companies. Outdoing them in speed and performance, attractive looks, and practicality – Tesla is changing the motor industry.
Manufacturers like Volvo, Porsche have now rolled out their own hybrids cars. They are looking to go the route of fully electric motors within a short matter of years.
Such notable paradigm shifts in the way we do things embody the beautiful concept of creative destruction. Those that shun it get left behind.
And while it is not all about the monetary gains, you can own the coins to use for transactions rather than for investment.
It will serve you better, in the long run, to get in the know of what is out there.
Beware of scammers
Be wary and vigilant, as like with money and investment, there are sharks out there (offering deals). The aim is to exploit you and many other unknowing technophobes looking to make a quick buck or two from Crypto.
Mining Cryptocurrencies (is particularly conducive for gaming enthusiasts) and using them to benefit you quickly and securely in the way of a new digitized future.
Some Internet pirates in desperation use anonymous digital currency such as Monero. They now use java-scripted mining devices (hidden behind ads) to drain hash power unsuspecting from your web-page browsers.
The way forward
Everyone is trying to get a piece of the action! There are also legitimate paid commission-based add-ons for trading as well – opening up a new world of digital earning online.
Don’t get left behind. But as with any investment, and a caution to the wise: Cryptocurrencies are highly volatile, and should not substitute any investment portfolio. They should only and always account for a fraction of your overall investment.