🚀Why I Love Crypto
Last updated
Last updated
When the total market cap of the entire crypto industry (which includes Bitcoin, Ethereum, and the rest of the Altcoins) broke $1 trillion, I became 100% convinced that crypto and blockchain projects with great products, first mover advantage in the market, and fast-moving teams are here to stay and will disrupt a lot of things from finance, games and collectibles using NFTs, to identity. There's more than enough liquidity in the space to support these projects.
The 2018 Bull Run peaked at $850 billion and the 2021 Bull Run peaked at $2.5 trillion. Just imagine how high the next run would be.
The 2018 Bull Run, in my opinion, was driven by hype such as the ICO craze.
While the 2021 Bull Run was mainly driven by fundamentals:
Large financial institutions jumping in: Paypal, Mastercard, Visa, CashApp, MicroStrategy, Citibank, Tesla, JP Morgan. See Bitcoin Treasuries for more organizations.
Countries such as El Salvador, Paraguay, and Philippines consider Bitcoin as legal tender.
Huge companies and celebrities support NFT such as Instagram, Twitter, Dolce Gabanna, NBA, Paris Hilton, Steph Curry, Jimmy Fallon, etc.
Play to Earn games such as Axie Infinity, Pegaxy, etc.
We're slowly moving from fiat currencies into cryptocurrencies.
However, transition from one working system to another usually takes a lot of time and painful regulatory challenges.
Imagine the effort when companies were migrating from physical servers to cloud services. There was a ton of skepticism in the beginning. But today, being on the cloud is always the best way to operate.
Going back to crypto replacing fiat...
Bitcoin alone was bigger than Paypal, Mastercard, and Visa combined at one point. Ethereum is bigger than either Paypal, Mastercard, or Visa.
Inflation in the Philippines can go as high as 5% and banks are giving their customers 0.1% to 3%. Filipinos (or most people in the world) are losing money while saving.
DeFi protocols such as Aave, Compound, and Pancake Swap solve this problem by providing 2-3 digits Annual Percentage Yield (APY).
Too good to be true? How can they achieve this?
Everything runs on smart contracts. Less employees to pay, no establishment to rent, less operations costs.
The process of opening a bank account in the Philippines is still hard. (Except for the newer digital banks. This applies to the top and trusted banks that are still stuck in their old processes.) - A ton of requirements - Long forms - Some banks still require you to go to the branch despite how inconvenient it is because of the pandemic plus traffic. - Bank customers need government IDs to get started and verified. How about the students who do freelance or a student entrepreneur? They have money to store too.
With the rise of DeFi, the use case of crypto became 100% validated. Just use a non-custodial wallet such as Metamask or TrustWallet, you can create an account without KYC and use it any DeFi apps that run on Ethereum and Ethereum Virtual Machine (EVM) compatible chains such as Binance Smart Chain, Polygon, etc.
The power is distributed to the community where everyone can raise proposals on how to grow the ecosystem and vote on them.
You can’t do that in centralized organizations where hierarchy is important.
What's wrong with fiat money?
Corruption from governments and private organizations.
Unlimited money printing that can be done in private which weakens the value of the money.
For digital money, it's not tamper-proof and not hosted on a distributed ledger similar to a blockchain where it can be verified in a decentralized way. Not just the centralized entity.
Fiat is not global. It's usually just limited within the country: PHP to Philippines, USD to USA, SGD to Singapore, etc. Foreign exchange is super inconvenient.
Fees are terrible especially in remittance services due to several middlemen.
Crypto solves all financial problems. Let's push the fiat to crypto movement globally.
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