It started as merely an internet toy created anonymously at the amusement of a small group of cypherpunks.
The brilliant technology speaks for itself, and like any other new tech, quickly made a small group of computer programmers and early adapters incredibly wealthy. Global media outlets take note.
It’s quickly brushed off by Wall Street and Silicon Valley as a ponzi scheme, or better yet, the “Myspace” of Blockchain technology.
With this newly minted buzz word “Blockchain” tons of programmers, entrepreneurs, students, and scammers jump on the hype train. We see thousands of new and “revolutionary” cryptocurrencies all claiming to be superior to bitcoin.
Many of which lack the basic fundamental qualities needed including decentralization, security, credibility of monetary policy, immutability, distribution, infrastructure, and more.
Attracting a large number of unproven and inexperienced founders, CEOs, and first time entrepreneurs the majority of these new projects lack the experience to follow through with their promises to investors.
Retail, VC, and HFs jump in before regulations are set lacking the necessary understanding of this new industry and monetary policy creating a completely bogus evaluation model in the process.
An enormous amount of investment pours into these scams creating even more noise and confusion. A few of these projects are able to outperform Bitcoin in the short-term picking up strong followings in the process.
Eventually credible teams are assembled attracting established VCs with giant discounts buying new coins at bulk, creating even more hype, only to later be dumped on the retail market.
After an unexplainable bull market on these alternative coins the community is forced to sit back and watch as every project fails to deliver on each and every promise they made to the crowd. In the process creating zero unique use-cases and wiping out most of the newly created value, further exposing the endless flaws with the new properties, technologies, and the inexperienced entrepreneurs running them.
Meanwhile, Bitcoin, remains constant and retains its value over the long run establishing even more mainstream credibility as these alternative coins disappear.
People, left burned in the “alt coin” craze, witness and learn first hand about Bitcoin’s superiority across all characteristics.
Right before and even during the next phase of rebooted blockchain projects spurring another bull market, Bitcoin’s unshakable and anti-fragile record exacerbates the chronic fear of missing out.
This next go around Bitcoin is clearly established as the standard in which all other cryptocurrencies will be judged.
As the years go by hyper inflating fiat currencies across the globe further contribute to the slow grow of Bitcoin becoming a great means of securely preserving wealth.
High net-worth individuals and Investors are convinced to allocate a portion (0.25% – 7.50%) of their portfolio into Bitcoin to capture and hedge against future growth, as well as increase Sharpe ratio of their traditional portfolios.
Extreme speculation facilitates and “speculative attack” on “stable” currencies as the increase in demand for Bitcoin necessarily involves a reduction in demand for fiat causing higher than expected fiat inflation. (See Pierre Rochard article here)
Attempting to adapt Central Banks finally give in and start to accumulate Bitcoin, somewhat like they do with Gold today. This causes the most legitimate bull run to date.
As we watch the market cap grow beyond the ~5-10 trillion range we fully acknowledge that one of the greatest monetary wealth transfers of our time has occurred.
Early adapters, investors, developers, and miners now begin to actually spend their Bitcoins at will on everything from real estate to bubble gum.
The short term daily volatility begins to subside.
Global demand to be paid in Bitcoin increases as more people are able to work freely from anywhere and businesses have fully accepted the ease and security of Bitcoin.
At this point Bitcoin can now be considered as a legitimate medium of exchange worldwide. Increasingly being used by corporations, banks, and governments as a legit unit of exchange.
Due to the emergence of a superior, deflationary, new monetary standard, people increasingly store their personal wealth in Bitcoin rather than fiat.
Central Banks power is ever so slightly reduced and previous local monopolies on money are described as a thing of the past.
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