Tag Archives: make money online

Business, Crypto, Economics, Finance, Observation

Bitcoin and Crypto’s Crash is not the First, the Largest or the Last

Above: Photo by Michael Krahn on Unsplash with elements added by Lynxotic

Coming after a frenzied run-up the hand wringing is no surprise

I many ways it seems as if Bitcoin and Cryptocurrencies appeared suddenly in 2021 out of the head of Zeus. Protean and fully formed, with billions and trillions in market caps, and all your sisters, brothers, cousins and even the Uber driver climbing aboard.

And the FOMO blog posts, where every hour an innocent reader is assaulted by a story, perhaps true, perhaps exaggerated and certainly foolhardy in retrospect, of an innocent putting their life savings into Dogecoin and suddenly having, theoretically, huge gains at their disposal.

Meanwhile, craggy faced, ancient stock market mavens would interject famous last words that now appear to be wise. However, all that notwithstanding, this week’s crash is nothing new or unexpected.

In reality, as can be seen from the graphic below, provided by Visual Capitalist, there have been so may crashes / corrections and doomsday prognostications since 2012 in Bitcoin that it seems like a miracle the there’s any thing such as Crypto at all.

There’s a reason it’s not dead and it’s in the DNA

The resiliency, far from a shock to those that have been around more than a fortnight, is kinda the point. When Satoshi Nakamoto built the system architecture of Bitcoin and since then inspired the over 8000 new crypto entities that have been developed, it was, just like the internet itself that was build to survive WWIII, supposed to be as indestructible as possible.

Like physical gold, which is considered have been adopted as a store of value partly due to its indestructibility and immutability (alchemy notwithstanding) the volatility and sometimes violent-seeming life story of Bitcoin is a necessary adjust to its role in finance, commerce and even individual monetary survival.

Not for the faint of heart, perhaps

While the mainstream and those forces opposed to the adoption or survival of Bitcoin and Crypto are out in force pointing to the “unsuitability” of Bitcoin and other cryptocurrencies for any “legitimate” use as a trade or savings vehicle, the progress so far, in spite of the obvious fact that volatility has always been baked in to the situation, is an obvious refutation of that viewpoint.

Will the current drop in dollar values relative to Bitcoin end it’s popularity and strip it of the respect it has thusfrar earned among many? In a word, no. In essence what is happening is, as many have foretold, what happens often and repeatedly, the excess attention and dollars that were pumped into crypto by you brother, sister, cousin and Uber driver are now getting blown out, since those were more speculation and psychosis than any kind of vote for viability or permanency.

And, why not? Where was to concern, shock and hesitation by the masses when the prices seemed to only rise for weeks and even months across so many products and coins it was impossible to keep count? Why was to feeding frenzy and the mania-like piling on not ignored as an anomaly?

The herd does as the herd will do. Diamond hands and Paper hands will ebb and flow as long as the rivers flow to the sea and humans herd like buffalo. And, in all likelihood, dollars and euros and yen will be long forgotten when the last bitcoin is transferred to the final wallet in the sky.

Disclaimer: This article is for informational purposes only. It is not a direct offer or solicitation of an offer to buy or sell, or a recommendation or endorsement of any products, services, or companies. Lynxotic does not provide investment, tax, legal, or accounting advice. Neither the company nor the author is responsible, directly or indirectly, for any damage or loss caused or alleged to be caused by or in connection with the use of or reliance on any content, goods or services mentioned in this article.

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Business, Crypto, Economics, Finance

Elon Musk is taking sides in the ‘True Battle’ between Crypto & Fiat

Video

Above:Photo Credit / Unsplash / Collage / Lynxotic

If you are stuck on the word ‘fiat’ this post can help you (everyone else too)

In a single, 14 word reply to a follower (@TheRealShifo) that asked “Yo Elon what do you think about the peeps who are angry at you because of crypto?” He gave a simple answer that is the often unmentioned, yet most important, question regarding crypto vs. fiat, government issued, currency such as the US dollar.

Looking around during the ongoing frenzy surrounding crypto and digital finance you’ll see countless ‘news” stories and blog posts comparing, or pretending to compare cryptocurrencies, especially the two biggest Bitcoin and Ethereum (as coin sometimes referred to as “Ether”) and they virtually always quote the “price” fluctuations of those coins as a certain number of dollars and cents.

Interestingly I have yet to see any of these “comparisons” use the reverse valuation method, such as, “the US dollar is currently worth .00002703 Bitcoin. Can you imagine everything using that as a standard – CNBC quoting stock prices in Bitcoin, your house is “worth” 32 Bitcoins (if you’re in California, for example).

The reason this comes off sounding strange and ridiculous is that all communication related to the US dollar, which has been a fiat currency since abandoning any “backing” (such as gold) and continuing on by decree (or fiat) of the government with no backing other than than decree, also carries a decree (tacit) not to undermine it in public.

So when Elon says:

“The true battle is between fiat & crypto. On balance, I support the latter.”

Simple and straightforward and yet intentionally shrouded in mystery

Musk is directly comparing crypto, generally, and fiat currencies around the world that “float” against each other. And by inference, doing so in terms of the difference between a fiat currency like the US Dollar and a crypto currency, like Bitcoin.

A fiat currency is money that is not backed by a physical commodity like gold, but instead backed by the government that issued it. Most modern currencies, such as the U.S. dollar, euro, pound and yen, are fiat money.

from Wikipedia

The term fiat derives from the Latin word fiat, meaning “let it be done” used in the sense of an order, decree or resolution.

— common Definition

The fact that Bitcoin was created as a digital alternative to fiat money stands at the forefront of that point. The fact that it was designed precisely to counter the drawbacks and dangers of a system based on fiat paper money (or digital ledgers of those paper dollars such as your bank balance or any method to keep track of how many “imaginary” paper dollars you “have”) is exactly the real issue at hand.

photo credit: twitter

It’s no secret that many attack those goals and intentions superficially and dismiss the entire discussion with a wave of the hand. They willfully use the complexity of the cryptographic solutions, at the heart of cryptocurrency, as a way to gloss over the real and substantive problems being targeted.

They prey on the ignorance of the majority to try and discount out of hand any value at all for the movement and the various products.

Opening up the door to this exact exchange and characterizing it as a “battle” in one fowl swoop clarifies and simplifies the real issues and the real reason for the existence, and according to many, including Elon Musk, the need for monetary “reform” or change via a shift toward crypto.

Opening up the door to this exact exchange and characterizing it as a “battle” in one fowl-swoop clarifies and simplifies the real issues and the real reason for the existence of, and the need for, monetary “reform” or change via a shift toward crypto.

D.L.

The “price” of Bitcoin or any other crypto currency on any given day has almost nothing whatsoever to do with that debate.

Speculation abounds but not just in Crypto

The “price” is a function of, mostly, speculation and scarcity, due, in the case of Bitcoin to the mining cap, or at least a perceived scarcity. And additionally the various perceived advantages of crypto such as privacy, decentralization, use of block chain systems, etc.

But the price is like the smoke above the battlefield, not the reason for the battle or any indicator who is winning or who is on the side of might or right.

Two major questions that arise from this tweet and the potential shift toward a clearer and simpler dialogue on crypto are the following:

  1. Is crypto generally, and Bitcoin / Ether more specifically established and entrenched enough to withstand the coming backlash from governments that feel threatened and other status quo institutions that will do whatever it takes to discourage or even stamp out crypto usage?
  2. Will the very battle itself, that Elon Musk says is the current “true” battle, bring even more attention to the weaknesses and problems with the current fiat money system and thereby increase, perhaps inadvertently yet massively, the size of the battle and its stakes?

Alternative systems of trade have been tolerated in the US for some time now. How are those air miles doing? What about the chips and points for perks you got at the Indian Casino? Is it too late to outlaw all crypto without causing a revolution in the streets?

The other side of the (clipped) coin

It is truly surprising to see how little is to be found in the media about the deeper reasons for the rise of crypto. How it sometimes seems like direct criticism of fiat currency is almost taboo.

Naturally any internet search will find many “rabbit hole” sources for all kinds of information critical of the current monetary system, the same system the near total collapse of which in 2008 inspired the creation of bitcoin.

It appears that Elon Musk is emphasizing, in a subdued manner, exactly the way that the nonsense-furor over huge price gains or declines is completely missing the actual point. The “true battle”.

Many stories in the media and millions of private comments are currently following a kind of convoluted logic – first the popularity of crypto (which is linked to the unpopularity of the very messed up fiat system) artificially and massively increases prices in many crypto assets.

This “bubble”, a typical outcome of human herding behavior in financial markets, inevitably bursts or sees large setbacks. Then the coin or crypto system itself is blamed for the human stupidity and greed that caused the distortions of price, just like happened in the dot-com bubble and the 2007 housing bubble and subsequent crash.

The difference is that the crypto bubble, in an interesting way, is in reality due to a surge in skepticism toward fiat currencies, a boom in the prevalence of mistrust toward governments and a combination of fear and greed that is growing, not dissipating.

Although many have rightly criticized Elon Musk’s tweets and odd Saturday Night Live appearance, and there is a kind of mini-backlash (growing?) against all things Musk, in this case it is a healthy and wise tweet that we have shown above.

Reframing, or more aptly refocusing the discussion away from prices and speculative profits and back to the real reasons that cryptos were initially created and why it has gained such massive support is a welcome shift. That this reframing comes from the likes of Musk himself, is fitting and who better to put forth a message to simplify and clarify the nature of the real “battle” at hand.

The following video has some interesting data and arguments for, and mainly against, the fiat regime under which we have lived for most of the last century. Although, in a sense, a kind of advertisement for Gold and Silver, the overview is nevertheless accurate and does not exaggerate the dangers and issues that revolve around the fiat system.

Disclaimer: This article is for informational purposes only. It is not a direct offer or solicitation of an offer to buy or sell, or a recommendation or endorsement of any products, services, or companies. Lynxotic does not provide investment, tax, legal, or accounting advice. Neither the company nor the author is responsible, directly or indirectly, for any damage or loss caused or alleged to be caused by or in connection with the use of or reliance on any content, goods or services mentioned in this article.

Find books on Money and many other topics at our sister site: Cherrybooks on Bookshop.org

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Lynxotic may receive a small commission based on any purchases made by following links from this page

Business, Observation, Social Media, Tech

A Huge and Welcome Shift in Social Media Money is On the Horizon

Above: Photo / Adobe Stock

Platform wars are heating up and influencers may be prime beneficiaries…

Something strange is happening in social media: influencers are getting paid, sometimes directly by platforms.

To clarify; there have always been ways for creators with a large following to monetize their stats. Mainly, however, until recently that mostly involved sponsorships and affiliate merchandise, and the like.

On top of the efforts required to create winning content, getting paid for it was an additional job and creators got little assistance from the greatest beneficiaries of the work: the host platforms themselves.

Suddenly, it seems, the value of creators in bringing and keeping traffic for the platforms is so high, as a war rages between platforms for that traffic, that some have gone as far as initiating new programs to pay influential content makers directly.

…for more visit our homepage

Naturally, YouTube has had a monetization program that requires elevated status to qualify for and then takes a more than 30% cut of the proceeds, but on the whole payment for creative content production has been minimal for all but the most massive stars in the social media firmament. Now, that appears to be changing, and fast.

Snap, a once hot destination, is trying to boost its attractiveness by paying out $1 million per day for popular posts. TikTok, the fastest growing platform recently, has also set up a fund to pay out to creators and says it will increase the fund to $1 billion.

All of this is not going unnoticed by the platforms with the most traffic, Facebook and its owned entity Instagram, and, in an unprecedented move, payments are beginning to flow on those platforms also. Twitter, Clubhouse and others have various plans in the works as well.

There’s a massive shift toward coveting creators as a result of competition for traffic and members

What this all boils down to is two things. There’s a war going on (in reality battles left and right in many areas of internet dominance) and the spoils are traffic growth, and that growth is only possible for the platforms if creators migrate in and stick around.

As long as Facebook, Instagram and Google’s YouTube were untouchable monopolies they did not need to admit that they needed the allegiance of creators and influencers.

As the only game in town, each in a different monopolized neighborhood, there was literally no where for the creators to run to. No more. Mainly TikTok and now upstarts like Clubhouse are changing the landscape and that is scary to the legacy platforms.

Anecdotal evidence points to the ability for talent to garner views and followers, via the algorithm settings that either promote or hide content from prospective consumers, as the prime mover, at least initially, for the creators to favor TikTok.

Stories abound of creators that, within days or weeks, were able to get millions of views due to the “democratic” openness of the TikTok system for featuring content based on less restrictive algorithms than the entrenched platforms.

The once invincible behemoths at Facebook and Google let greed get the best of them. It has been literally years since organic reach, the ability to get views and traffic just on the quality of the content, was possible on facebook and the price to reach an audience, with paid posts, just kept going higher and higher.

Now, due to this tectonic shift in power, from the platforms to the influencers and users, there is, unbelievably, a situation emerging where Facebook must appease the talent and creativity of the content creators if they want to remain relevant.

Pending antitrust actions and privacy issues are just adding to the shifting status and uncertain future of social media

In a sense, there was always a kind of unwritten rule of social media: the owners and creators of the platforms retained all the money and power with none of the liability or labor requirements.

That relationship, which is like slaves who built the great pyramids, but without the allowance for food or shelter, was doomed from the start as it is based on a lie.

Ultimately the platform has very little to offer, technological and software designs are easily replicated theses days, and these platforms are not in the business of generating any of content, yet they expect that content to be created for free by users.

This ridiculous valueless and vampiric scam has been lionized and worshiped as the ultimate internet success formula for more than a decade.

Facebook, and Mark Zuckerberg, have stood as the ultimate arbiters of how to become obscenely rich by enticing the world to work and create content for your platform for zero renumeration.

Once a company, coincidentally one that originated in China, came along and decided not to worship the Zuckerberg formula, but to undercut it by giving creators an ever-so-slightly less terrible deal, the spell was broken.

Next, it was only a matter of time before the war over the real value began: the content itself that users and particularly top creators on each platform provide.

Not to say that TikTok is heroic or intentionally upset the apple cart as a result of any foresight or altruism, this is just the inevitable outcome of a failed and corrupt system eventually becoming mature and collapsing (slowly) under its own stupidity.

For now, this slight reprieve from endless exploitation is an extremely hopeful sign. Let’s hope that creator payouts and the competition for content, real content that has value regardless of which platform hosts it, will continue to rise in stature.

Any creators or influencers out there who are listening, do what you do best which is create, and now add the option to sell your services to the highest bidder to your toolkit and keep your eyes and ears open for the next, even more accommodative platform to emerge from the muck. Then go there.

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