Topic: Cryptocurrency is unsupported: is it true or is it a myth? (Read 74 times)

Perhaps, the most long-running discussion in the context of the crypto-currency market is a discussion about what the crypto-currencies are supported.

Like, traditional currencies are officially supported by whole states with different sectors of the economy, and the crypto-currencies are not backed up and therefore can not be seriously considered anything at least remotely comparable to traditional currencies.

In fact, the situation is somewhat different. First of all, the crypto-currencies are backed up by the US dollar, no matter how strange it may sound.

Let's figure it out. What gives a huge number of people the belief that it makes sense to hold the American dollar or, for example, the euro? Understanding that this currency is stable and for the preservation of its value is the responsibility of the state, interested through this currency to receive income in the form of taxes, etc.

On the crypto-currency market, the situation looks somewhat different.

Of course, there is no state here that is responsible for the preservation of value. But in traditional currencies, objectively speaking, no state guarantees that the national currency will be stable and will not fall in price. Moreover, we never talk about the fact that this currency will grow in value or in some other way develop and strengthen its positions.

The same in crypto-currencies. There are no guarantees and obligations from a certain central authority, but there is a collective interest and financial motivation regarding the viability of the currency. In the crypto-currency market, this financial motivation is present among those who invest in them, and those who are engaged in mining.

If the dollar is based on the interest of the US state to make money, bitcoin is based on the interest of investors and miners to make money.

the key difference in this case is only that the state has regulatory instruments that do not allow the market to spontaneously weaken the exchange rate of the national currency. And in the case of the crypto currency, there is no such regulation and, in this connection, supply and demand can grow very disproportionately, leading to significant fluctuations in the exchange rate.

Thus, crypto-currencies are supported by the desire of many invested in this market to earn people, and it is not just about private investors.

A huge number of companies have already invested tens of billions of dollars both directly in the crypto-currencies, and in the development of the accompanying market infrastructure.

And it is these investments, taking the form of huge mining farms, factories for the production of equipment, institutional investment funds, the largest exchanges and much more, generate interest in the development of the crypto-currency market comparable in strength to the interest of the state in obtaining income through national currencies.

And at this stage, it is this interest that is the main guarantee that tomorrow the crypto-currencies will not suddenly disappear, and the rapid growth of crypto-economy will not stop there.