Why cryptocurrencies are here and aren’t going away anytime soon

Bitcoin and Monero

On the surface it would seem that all the news and articles popping up about bitcoin and other cryptocurrencies are wildly out of proportion to the coins’ actual use; after all, there are currently only about 6 million bitcoin wallets in use on our planet of 7 billion people. That’s a very small percentage indeed. But something is happening, even if the media is mostly trying to make fire out of smoke.

The question is what. What is all the fuss about? Is it about getting rich? Is it about laundering money? Or is it really all about blockchain, the technology behind cryptocurrencies?

Actually it’s all about trust. And freedom.

The idea of money has been around in human societies since ancient times. We’ve tried using shells, cows, gold, pigs, and all kinds of things as money. Right now we use expensive paper and metals.

Any kind of money requires 6 things to work effectively:

  • durability
  • portability
  • divisibility
  • uniformity
  • scarcity
  • trust

Modern finance was built on a foundation of centralised trust; we now live in a world of eroded trust.

“The name of the game? Moving the money from the client’s pocket to your pocket.” [The Wolf of Wall Street movie.]

Just 30 minutes of watching the news, browsing the internet, and engaging in social media tells you that most people at the moment don’t trust

  • governments
  • bankers
  • lawyers
  • brokers
  • businessmen
  • corporations

and almost everyone else. Financial institutions literally suck — they’re not there for you; they’re there because they’re in business. We know this.

Everyone is chasing money these days; we live in that kind of a world. But we’re no longer as trusting as we were. We all want money so that we can have

  • no worries
  • no fear
  • security
  • the ability to choose
  • the ability to act

and cryptocurrencies look like they can be trusted. As money, Bitcoin, Monero, Ethereum, Litecoin and the rest satisfy the first 5 requirements but are special when it comes to trust. As far as trust is concerned, at the moment they excel. Whether they will last is impossible to say. Maybe another, better, technology will replace them. Who knows? But right now they’re looking good. And that’s disruptive.