Crypto Currency Investing Chapter 2 Summary: Why The View of Crypto is Outdated

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Cryptocurrency is not our savior!

Some people believe that crypto is going to revolutionize the financial system.

Unfortunately, this is unlikely to happen anytime soon. Mainly because not enough people understand it, and what people don’t understand, they fear, and if they fear it, they won’t use it.

What is much more likely to happen, and what we are seeing emerge even today, is that crypto will coexist with the current fiat monetary system.

Fiat money was, and still is, a good solution to replace the barter system.

Unfortunately, since its creation, the commodity backing it, such as gold, has been removed. This is one reason why it has inflationary tendencies.

When inflation gets out of hand, it causes huge problems.

There are several examples in recent history of entire countries going down the financial drain because of this, such as Venezuela.

Cryptocurrencies and blockchain are much more resilient to inflation because they often have a limited supply. Bitcoin, for example, is capped at 21 million coins.

This scarcity helps to preserve the value of the currency as opposed to fiat currencies that can be printed in unlimited quantities by central banks.

Read the next chapter here.

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