Sometimes General News Media and Cryptocurrencies don’t Mix
The article linked below was published in the Augusta Chronicle, a newspaper based in Augusta, Georgia and owned by Gatehouse Media. The reporter, Damon Cline, claims Bitcoin is a subject he never really wanted to address and write about, which is obvious while reading the article. There are so many mainstream media arguments used, it seems he just watched a few hours of CNN to collect his information. Cryptocurrency is a subject Cline admits does not really appeal to him, and that admitted lack of interest should be enough to make readers question if the information in the article has much value.
The article includes the statement, “I’m willing to bet no Bitcoin ATMs have been seen outside the Interstate 285 loop,” (referring to Atlanta). This is a bet he would lose, and could easily have been verified by a quick search. It also states the high for Bitcoin was “more than $16,000.” While technically true, the actual value is considerably higher, and the statement shows not even fifteen seconds of research was done to look it up and provide this basic Bitcoin information to readers. Here is the article.
The number of times cryptocurrency myths are used is staggering. The article refers to Bitcoin being used to buy drugs, but for some reason doesn’t mention dollars, and all other currencies, are also used to buy drugs. Cline talks about real coins and dollar bills as government backed, when in fact dollars are created by issuing debt, and add to the trillions of dollars in debt Americans will someday have to repay. Over ninety percent of US dollars only exist digitally, including the money in our checking and savings accounts, making the US Dollar the largest digital currency in the world. There is no gold standard any more. Nothing is backing the US dollar other than promises.
The piece later states, “the only thing that gives Bitcoin tokens any value is that people are using actual money to buy them.” Really? The only thing that gives any asset in the world any value is that people are using actual money to buy them. There is an entire financial investment category called Forex where currencies are valued based on the amount people are willing to pay for them. I don’t understand what the point of his statement is. In addition, anyone with any knowledge of cryptocurrency knows there are many tokens, but Bitcoin is not one of them.
Cline makes statements with no value, such as “if all this seems outlandish, it’s because it is,” when referring to Bitcoin mining. People often cover their misunderstanding with statements like this, but newspapers don’t usually publish such statements. This only shows the author simply didn’t have the time to find out how to present the subject in a way readers can understand.
He goes on to make a statement, “there is no way to get your Bitcoins back… if your computer crashes and erases all your Bitcoin data.” This is completely inaccurate and further indicates no experience at all with actual Bitcoin wallets. Bitcoin basics teach you to backup wallet files and encrypted passphrases are used to insure computer problems do not result in a loss of Bitcoin. In the same paragraph he also states, “there is no way to get your Bitcoins back if your wallet is hacked and your data is stolen,” but fails to mention there are secure ways to store your bitcoin in offline wallets where the data cannot be compromised.
Unfortunately for readers, the article continues making unhelpful comparisons, such as, “the market value of the entire crypto industry could top $1 trillion this year. That’s three times bigger than Exxon Mobile, a real company with real, income producing assets.” The current crypto market is only worth around $400 Billion, so just 40% of the fabricated value being used in the comparison. For some reason he is adding the value of over 1200 crypto assets into one bucket, and comparing it to the value of one company. Why not take 1200 “real companies with real, income producing assets” listed on the stock market and use their combined value? This evaluation is ridiculous. It is like trying to make a comparison of the value of all restaurant chains added together to Microsoft, and somehow correlating them.
The worst piece of reporting soon follows. The article states, “(Bitcoins) value is predicated solely on the idea it can be sold to someone else for more money in the future, much like a Ponzi scheme.” Isn’t any investment anyone purchases, whether a stock, mutual fund or gold, made with the idea it can be sold to someone else for more money in the future? Are these all Ponzi schemes? Does anyone at the Augusta Chronicle know what a Ponzi scheme is? What newspaper publishes an article where the author states buying an investment that is expected to increase in price in the future makes it a Ponzi scheme?
The whole point for people who want to look into Bitcoin, and other cryptocurrencies, is this… these are risky investments, which should be made with money that you can afford to invest with. If buying Bitcoin will cause you not to be able to pay your rent, you should not be buying Bitcoin, or any investment. There are thousands of cryptocurrency projects you can invest in. Many ventures will fail, and some will succeed wildly, just like other companies throughout history. If you do your research, find ways to secure your investments, and buy into projects with a promising future, you may find yourself making more than any other market in the world is currently returning. My advice is to look into this on your own, and not base any decisions on the appalling reporting published here by the Augusta Chronicle.
This article was sent by an anonymous contributor, author opinion and views are solely their own.
Featured Image credits by thespinoff.co.nz