They’re back. As the crypto bear market worsens, haters come out of the woodwork again to mock an industry they have long insisted was nothing more than an outrageous scam.
Veteran crypto users have seen this movie before. It happened in 2010, 2014, 2018, and it’s happening right now: Media researchers and random observers – many of whom know nothing about cryptocurrencies – bring up the same tired talking points to say they’ve been right all along.
On Decrypt, we report on the good, the bad and the ugly of the crypto industry – and we are the first to admit that there has been a lot of ugliness lately. But we believe that crypto is fascinating and has come to stay. And with the latest amount of mocking headlines celebrating the crash, that’s it deja vu all over again.
Fortunately, we are here to help. The next time an “expert” at a dinner party starts explaining why crypto is nothing more than a scam for suckers, point them to these lines. Print it out. Fold it and put it in your wallet. Laminate it and use it as a table base. Put them under the wipers on the bank. Everything to shut up about these people – plus it keeps blood pressure down.
“Crypto is one big Ponzi scheme. Tokens only go up when there are enough suckers to buy more of them.”
rebuttal: Are any token projects and shitcoins Ponzi-like scams? Absolutely. But you can say the same about many sparsely traded penny stocks and other high-risk investments. In the decade-plus-price history of Bitcoin and other top tokens such as Ethereum and XRP, their value has never gone to zero – which is what happens in a Ponzi scheme. Instead, each has recovered from several bear cycles to surpass previous heights.
“Crypto has no intrinsic value. Unlike fiat, crypto is not supported by anything.”
rebuttal: Since the dollar fell off the gold standard in 1971, the dollar has not been supported by anything either. Bitcoin has value due to the use of the technology behind it. And legitimate crypto projects are supported by large and growing online communities whose wealth and influence now surpass some small countries.
“Crypto is not safe. People are constantly being hacked.”
counter-evidence: Hacks happen when people fall victim to phishing scams and give access to their wallet, just like similar scams in tradfi, outside of crypto. Beginners and cryptony newcomers who use secure platforms such as Coinbase or Gemini or FTX have not lost a penny on fraud.
“Bitcoin was invented in 2008 and has not managed to take off.”
counter-evidence: The Internet was invented in 1969, and the first consumer web boom – the one that forut the dotcom crash – did not happen until the mid-1990s. In 1995, there were only 40 million people on the Internet. Bitcoin already has over 100 million users worldwide. The widespread use of mobile networks, apps, social media and e-commerce (what cryptocurrencies refer to as Web2) did not happen until the iPhone was made in 2007. It is 18 years into the web. Bitcoin is only 13 years old.
“Crypto is for criminals”
rebuttal: The same goes for $ 100 banknotes or gift cards, both of which are popular among drug cartels. While Bitcoin and other cryptocurrencies have become a favorite payment method for certain types of crime, especially ransomware, the number of criminal transactions as a share of total cryptocurrency activity is relatively small and shrinks every year. In addition, law enforcement has recently done on several occasions what was once considered impossible: track down and recover stolen crypto. Finally, data in 2019 from Chainalysis and the UN Office on Drugs and Crime found that for every dollar of Bitcoin spent on the darknet, $ 800 in USD is laundered.
“Blockchains are not good for anything.”
rebuttal: Blockchain applications are useful when something can be improved or made more efficient through decentralization, such as the age-old software used by banks – and that is why even banks test blockchains. Distributed ledger technology has already become an integral part of the technology stack.
“I still can’t buy my cup of Bitcoin.”
counter-evidence: It is true that Bitcoin has not caught on as a daily payment mechanism. The currency is still volatile, and even small crypto payments – including for a cup of coffee – can trigger tax liabilities. Bitcoin and cryptocurrencies are still not ready for prime time. Men blockchain technology is evolving rapidly, and there have already been major breakthroughs on the payment front in the form of non-volatile stable coins such as USDC, Lighting and other payment rails built on blockchains, and pending bills in Congress propose tax exemptions for crypto transactions. $ 200.
“Crypto kills planet”
counter-evidence: Bitcoin’s energy-intensive design is not representative of the vast majority of blockchains, which use a technology called “proof-of-stake” with an exponentially lighter environmental footprint. Ethereum’s migration to proof-of-stake will be completed by the autumn. And Bitcoin miners are increasingly recognizing the need to shift away from fossil fuel-based energy to solar energy or other forms of clean power.
“Web3 is clumsy and too difficult to use”
rebuttal: Compared to well-known apps like Instagram or PayPal, prominent Web3 services like OpenSea or MetaMask can feel junk or annoyingly complicated. When it comes to gaming – a field where Web3 has the potential to fit naturally – the most prominent crypto-initiatives (like Axie Infinity) are simplistic issues that prioritize hawking tokens over fun. So Web3 is not pretty or simple yet, which makes this the most valid critique. But the good news is that everyone in crypto knows that. Web3 builders rightly point out that the top priority for the industry has been backend infrastructure instead of user experience. Now that the infrastructure is in place, this is changing and new tools are focused on fantastic UX. When the next crypto boom comes, Web3 design will probably already have taken a big leap forward.
Click here for a printable PDF of the crypto defender’s cover mat.
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