The Beginning of the End?
It is hard for the recent news of FTX to escape anyone. A once thriving cryptocurrency worth billions has seen an epic collapse. There is still a mystery in how FTX could have collapsed so catastrophically and in so short of time, and many of the words being used have revolved a great deal around “greedy” and “corrupt”, just to name a few.
Regardless of why or how it happened, there is a deeper lesson to learn from what happened with FTX, one that is not being shared elsewhere.
Cryptocurrency has risen in popularity the past several years, and many have begun to speculate whether its popularity has reached its peak. Even though we have seen record inflation for the past year-and-a-half, cryptocurrencies have not risen as many have speculated they would. It was believed that cryptocurrencies might overtake gold and silver as the ultimate “inflation hedges”, yet that has not been the case.
Given this fact, many would question whether FTX is just the beginning of the end of cryptocurrencies, and that soon, they will all follow in its footsteps. The correct answer to that is both yes and no.
There are lots of different cryptocurrencies out there beyond just FTX. There is Bitcoin, Ethereum, Dogecoin, just to name a few. The market is full of cryptocurrencies. And the truth is that in 20 years or so, they might not all be around. Many might befall the same fate as FTX.
Does that mean to avoid them entirely? Not necessarily. The market might shrink, but that does not mean it will disappear.
Cryptocurrencies in their current state will last, though it is still ambiguous how incentivized governments are to regulate crypto given the recent FTX fiasco. People use them, and as long as there is demand, they will stay around. Elon Musk, who just used 44 billion to buy Twitter, is a big fan of crypto, and it is not absurd to think in a few years he could implicate a system where users can pay for special features using crypto. Gaming might install the same type of network, maybe even some betting agencies.
No, cryptocurrencies aren’t going to entirely go away, but the market will shrink. Some will fall like FTX, and those that remain will be around for a long while. The biggest question that nobody knows the answer to right now is: which ones will survive?
