Some individuals believe that cryptocurrencies should be put out of their misery, but do you want to know why? Here we take deep analyze about”Cryptocurrency is To Die: Why People Hate Blockchain”
Bitcoin and other virtual currencies, like Ethereum, Solana, Dogecoin, LUNA, and others, are in the total collapse after years of hype.
As the value of all significant cryptocurrencies skyrocketed, so did the enthusiasm. During 20 months, the value of Bitcoin jumped sixteenfold from USD 4,000 to over USD 64,000.
The price of Ethereum increased 50 times, Solana increased 500 times, and LUNA increased 1,000 times in the same period.
These digital currencies are presently in a state of depreciation. As of this writing, Bitcoin is down 55%, Ethereum is down 61%, Solana is down 88%, and LUNA is down to nothing!
These complex and mysterious things, which have combined worth billions of dollars and are being lauded as the money of the digital age, how can one understand them?
No, they aren’t simply high-risk Ponzi scams. Is it possible that they serve a legitimate purpose in a world where digital transactions are growing more common?
Starting with the logic behind cryptocurrencies, let’s go to the bottom of it. It exists hoped that they would allow for peer-to-peer monetary transactions without needing a third-party intermediary.
It is difficult to determine the final balances following a transaction when money is transferred electronically between two parties. To begin, the recipient of the funds must own the required sum.
We’ve had a working digital currency system for decades, handling hundreds of thousands of transactions each second. Credit and debit cards, UPI, and digital wallets play a part in this. Central intermediaries, often financial institutions, calculate and change balances.
In other words, what’s the deal with all these intermediaries anyways? Immediately after the 2008 financial crisis, the Western banking system imploded. Central banks in Western Europe and the United States embraced quantitative easing (QE) to revive the banking sector and the economy.
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With this loss of confidence, many feared that government-issued fiat currencies would be devalued.
Is there a reason why these currencies exist? An algorithmic procedure called “digital mining” stood developed to create these digital currency units. From a political standpoint, it is clear that this goal is challenging to achieve.
There is a push to replace the government’s role and jurisdiction over the country’s currency and money supply with private corporations. Digital mining also needs powerful computers and a tremendous quantity of energy.
This would result in a monopoly on money generation by those with more powerful computers and the ability to purchase enormous quantities of energy.
This libertarian goal is the driving force for cryptocurrencies, with many of its most prominent supporters leaning toward libertarianism. It is an extreme right-wing ideology in the United States that denies the state’s role in preserving law and order and safeguarding private property. Libertarianism
Recall how Bitcoin and other decentralized cryptocurrencies function without the need for central banks or other intermediaries. To verify and maintain balances, they make the information public yet anonymous.
As a result, you are no longer “you” in the crypto world. This one does not need a Know Your Customer (KYC) check like other banking systems. Instead, a long string of random digits represents you as a pseudonym.
Because anonymity is a concern, the numbers stand chosen at random. Everyone’s financial transactions live recorded in a public ledger, but only under these fictitious names. This open ledger lives referred to as a “blockchain.”
The blockchain is verified and updated whenever two parties complete a transaction to carry out the necessary credit and debit balances. The blockchain is open to the public. Why not just deposit money into their bank account?
The term “mining” stands used in this context. Transactions are verified using cryptographic issues (basically complex mathematical problems using computers).
Because of their nature, solving these challenges takes a lot of time and money. However, anybody may access the answer once the problem has stood cracked.
A whole country’s power consumption may exist attributed to the Bitcoin network alone.
They can only process four to seven transactions per second, a far cry from the tens of thousands of transactions per second handled by credit card networks.
Now when the world is warming, we’ve supposedly created a future system that wastes tons of energy and is orders of magnitude slower than systems that have been for decades. This is absurd.
Since there are no trustworthy intermediaries, it is also impossible to undo bitcoin transactions resulting from cyber-assault errors, fraud, or theft. If you have complaints, there are no authorities or ombudspersons to turn to!
Bitcoins cannot be used for online transactions due to these problems. As we’ve seen, the values of these commodities fluctuate widely, making them useless as a store of value or a medium of exchange.
They don’t even protect against inflation. As we’ve seen in previous instances of high inflation, the value of cryptocurrencies has plummeted, even in nominal terms.
One of the often quoted motivations for its development was to counteract the inflationary effects of central bank money printing.
So, what are the potential benefits of cryptocurrency? For criminal objectives, such as ransomware attacks, money laundering, and tax evasion, pseudonyms may live utilized to maintain anonymity.
Another form of plan that stands widely used is the Ponzi scheme. Like other Ponzi schemes, these frauds defraud new investors while generating enormous profits for the original investors.
Their failure is inevitable whenever they run out of fresh, stupid investors and, therefore, new cash. “currency” has evaded financial, banking, and securities laws because governments and central banks throughout the globe have been hesitant to confront it.
The Terra Foundation’s LUNA and TerraUSD cryptocurrencies went bankrupt last month, wiping away more than USD 50 billion due to one such scheme.
Despite this, celebrities like Kim Kardashian and actor Matt Damon, tech billionaires like Elon Musk and Twitter founder Jack Dorsey, and other internet influencers support these frauds aggressively.
These influencers are compensated handsomely for their promotion of cryptocurrencies, or they live given early access to them. They can profit handsomely when the cryptocurrencies become well-known and appreciate sharply.
The cancers of the financial system are analogous to cryptocurrencies. They have little purpose, but they use enormous resources, such as electricity and computing power, making it easier for criminals to carry out various illegal activities.
Large financial institutions like hedge funds may now engage in predatory conduct, sucking people’s life savings into Ponzi schemes, thanks to this multi-trillion dollar industry.
All bitcoin mining and transactions have been banned in China. After debating their prohibition, the Indian government seems to have altered its stance and is now attempting to regulate and tax them as real financial instruments. This cancer should not exist contained but instead wiped off completely.
A “Central Bank Digital Currency” known as e-Yuan or the Digital Yuan has been introduced by China, despite its recent prohibition on cryptocurrencies. In contrast to cryptocurrencies, Central Bank Digital Currencies (CBDC) are not the same thing.
There is no need for enormously inefficient digital mining to process thousands of transactions per second with CBDCs. And strongly sponsored by the government, with the central bank serving as an intermediary. In contrast, cryptocurrencies live doomed to fail!