First crypto
Last night, I bought my first crypto: 500 ADA through the Voyager mobile app.
Many smart people I know have been investing in BitCoin or other cryptocurrency for years.
While I have a basic understanding of the blockchain technology, I never bought any cryptocurrency, as I didn’t understand the economics or how the market behaves.
... and now, Bitcoin $BTC $61K. Just a rush of new milestones before #PiDay2021 🤷♂️ pic.twitter.com/SJpLrtrTLO
— Adam Nash (@adamnash) March 13, 2021
Bitcoin may increase by 1000s of dollars in a week because of … speculators I presume? It is not because a company posted great sales results. And traditional currencies don’t see swings that big. So how this all really work economically?
The NFT or non-fungible token craze made me more wary of investing, as it is more stuff I do not understand. Why does one want to own “the original” of a digital asset, when that asset is never truly a one of a kind in the first place? In the physical world this is different: a Picasso is much different from a Picasso-reproduction. Jack Dorsey’s first tweet is no different on my computer than it is on your computer. Buying Jack Dorsey’s keyboard on which he typed his first tweet is different. Buying an NFT, doesn’t mean you own the asset completely. For example, as described in a great writeup by The Hustle, buying an NBA NFT of a videoclip of LeBron dunking does mean you get the broadcast rights to the clip.
On the other hand, I could understand how one wants to track ownership of physical art using smart contracts on a blockchain. But NFTs? They are complicated.
“On SuperWorld, you can buy NFTs in the form of virtual real estate. East 66th St. in NYC could be yours for just 500 ETH, or ~$822k!”
It is headlines like this that make me believe this is all a scam by some people hyping things up until they are rich and can cash out. Too bad for all the poor suckers who followed them. The crypto and NFT market appears to be a large cattle hall where everyone eggs each other on. Just type in a cryptocurrency into YouTube.
“Cardano will go to a thousand!”
“CARDANO BOTTOMED!! RALLY TO $20 IS STARTING!!!!! BITCOIN GOING TO $90,0000!!!
”The new Ethereal will be amazing!“
”How much ADA Do you need to be a MILLIONAIRE?
“Buy CryptoPunks art! @#$#@!!”
“CryptoKitties is going through the roof”
So if I am still such a skeptic about the crypto world, why did I buy my first cryptocurrency?
First of all, there are plenty of serious and smart people working on infrastructure and platforms underpinning this new world. Just as the first websites were silly - remember the Million Dollar Homepage - the first applications of a new revolutionary technology are often silly. Hello NFTs.
As I spent learning and reading about crypto technologies, scalable and distributed systems, it is a fascinating world with plenty of companies building great technology.
Thus I decided to buy my raffle ticket at the church of crypto’s annual crabfest. I started with Cardano ADA, and am looking into buying another infrastructure, protocol or storage related crypto.