Rolling the Dice

Feb 16, 2018

My mom's favorite thing is to get $20 of quarters and sit at a slot machine all day. She thinks she's good at it, lol, but I love her anyways. When I showed her some of the great returns I've made in crypto, she gasped and said, time to leave the slot machine while you're ahead! I thought that was such an odd way to look at something that I see nothing but blue skies ahead for. Would you get out of a car halfway to your destination?

There are plenty of spins on the cryptosphere that depend upon seemingly parallel analogies: the housing bubble, the great depression, Dutch tulips, and my personal favorite, the "casino". Let's break these down into subcategories of "where does the value of crypto come from?":


Many people suggest that investing in crypto is the same as gambling. You win some, you lose some. This is probably true that the odds are stacked against the poorly-informed investor, but if the valuations found in the cryptosphere were random, then there would be no consistent winners, and this just isn't the case.

So far, if you put enough time in, most crypto investors are winners, otherwise, this entire paradigm would never have exploded in the first place, no more than a gambling website would. In other words, if the risks with crypto-investing were truly random, there wouldn't ever be a cryptosphere and we wouldn't even be having this conversation. The value of crypto is not random. On to the next


Here we enter into the notions of crypto being a ponzi-scheme or pyramid (Tulips anyone?). Yes, most definitely crypto fits this architecture, but name one successful capitalistic paradigm that doesn't? If I, Paul, sell my stock holdings of any typical company because I heard some bad news is coming, chances are that money's coming from Peter who is buying my stocks, and I have no obligation to tell him anything.

The ENTIRE WORLD is a pyramid/ponzi scheme, it's just that some of them are legal and some are not. It would be impossible to distinguish the nature of the suckers going into crypto from the suckers in the stock market. Therefore, it's not the fact that suckers are unique to crypto, it's the fact that suckers introduce irrationality.

Does this mean that the suckers can destroy the cryptosphere in a giant galactic collapse? I don't know, seems the stock market is stronger than ever after decades of countless bubble pops; I'd be inclined to think that there's more at work here than "just" a worthless tulip pyramid scheme.


This is a unique category from the above two simply because there's the notion that despite moons and bubble pops, there's an underlying persistence to crypto that sustains it through the best and worst of times. Said another way, instead of crypto being a fad doomed to obsolescence, or crypto spectacularly exploding into nothing, it just regularly re-adjusts itself to compensate for undue optimism or pessimism in the valuations.

There are many large correction examples in Bitcoin since 2009, and hundreds of micro-examples; and it's still here. In fact, with every correction, you'll hear the vindicated Chicken Littles yelling, "SEE!! End of the Universe!! AHHAAHA HAAHA!! I was RIGHT! I was RIIIGHT!!!

Let these poindexters have their day, because without fail, the dead cat will eventually climb back up their faces to reach ever new highs. The point is, like the stock market, crypto isn't going anywhere because of:


Here is the real meat and potatoes of crypto, the fact that beyond speculation, there is inherent utility to these coins. You can't speed up cross-border international payments with a tulip. The number of use cases that crypto solves, from money-transfers, to store-of-value, to proof of identity, to even global computer resource commoditizing, etc., is endless. Blockchain is infinitely more constructive and useful than plain old money could ever be, and yet we still keep money around, right?


Take away the chaos of the speculating, and you have a very real, valuable, nascent technology that is just on the cusp of vastly interrupting virtually every aspect of everything; yes, it's that big. It's as big and as disruptive as the invention of the wheel. That's why it's survived all these challenges, that's why its value continues to climb in spite of manipulation and ignorance and critics and corrections and competition...and that's also why it's not a random/ponzi/pyramid scheme, because if it was, it would already have popped long ago.

Crypto.. is here to stay; you can bet on that.

Comments welcome on Twitter

Next Article