There were many charts talking about the bubble in cryptocurrencies towards the end of 2017. The peak of ‘Bitcoin Bubble’ on Google Trends was 7th December 2017, and the ‘peak’ of Bitcoin to the USD was reached nine days later at close to USD 20,000 per bitcoin.

 

‘It’s not a currency’ – ‘it isn’t a store of wealth’ – ‘it can’t be used to pay for anything’ – ‘can it buy a Mars bar?’

So much misunderstanding, fear, and pessimism about something as dynamic as distributed trust.

When surviving crew members of the 2008 financial crisis decry it as worthless and a fraud, one must suspect something interesting is happening. Which it is. Sometimes one must look further to isolate the Dimon in the Rough.

There is so much more to cryptocurrency than Bitcoin. There are hundreds of alternative currencies, or AltCoins, possibly thousands.

There is real money invested in these currencies – young money mostly, not anchored in the history of a financial crisis, traditional banks, traditional investment products, or fiat-backed assets. Is it all naive – possibly – but it is a tremendous force for innovation and achievement. Of course, the rapid rise in the price of cryptocurrencies and associated tokens has been amazing and has captured the attention of speculators, scam-artists, and regulators.

How will a wealth management arm of a bank sell a Millenial a bland fixed income saving product, with a ‘targetted’ yield of 4% and an upfront fee of 5%, when with no upfront fee, she can buy Neo – a Chinese backed AltCoin – that has an inherent 4% yield at today’s price, and who knows what level of upside once the 100 million coins are issued.

Of course, everything in moderation, but this generation of investors will have more risk appetite and an expected return on equity higher than the traditional market players of today. This is the cold-brewed coffee, avocado and poached eggs with cracked Kampot Pepper generation, that will be paying, or not, for your pension. Let’s hope they are successful in the adventures they are leading us into, even if/after the euphoria of Bitcoin fades.