Cryptocurrency is People’s Money, But Why Are Governments Suspicious?

CryptoCurrency is People’s Money

Just like democracy is a people’s system for the people, and by the people, cryptocurrency is also people’s money, for the people and by the people. Decentralization is one of the founding pillars of cryptocurrency.

Decentralization in finance means the financial system is not controlled by the government or any other organization, it is completely owned by the people.

Fiat currency is the money that is completely owned and controlled by the government. As a person who believes in democracy, how can you trust a currency that is completely owned by the government? You might argue that you voted them to form the government, so it's your government. Think carefully, is that people’s government or a government formed by elites?

Instead of a currency controlled by the government, why not choose the currencies that are created by the people for the people, or let's say currencies that you can control.

Do you think cryptocurrencies are actually used for illegal activities?

One of the main reasons why governments around the world do not trust cryptocurrencies is because they believe cryptocurrencies are used for illegal activities, such as paying for drugs and weapons, funding terrorism, etc.

Not just the governments, investment, and finance experts also believe that cryptocurrencies are actually used to fund criminal activities because of their anonymity.

As far as I am concerned, I don’t think there is a reason to ban cryptocurrencies simply because terrorists and criminals are using them. One of the biggest terrorist activities on American soil occurred on September 11, 2001. Bitcoin was launched 8 years later. Terrorists funded their activities through fiat currency. Why don’t they ban fiat currencies, first?

Do you think governments’ decision to ban cryptocurrencies because it is used for illegal transactions is valid?

Are Crypto Currencies Still Digital Currencies or Crypto Assets?

Crypto means encryption of data and currency means money. Therefore, cryptocurrency is encrypted data that is used as currency. Bitcoin is the world’s first cryptocurrency, or let's say the world’s first digital currency (a currency that exists only in the virtual world)

Bitcoin was started as a digital payment system that eliminated the intermediate system like banks and allowed to send funds directly between two individuals or businesses without hassles.  For 4-5 years after bitcoin was launched, there were only a few cryptocurrencies and they were all used as a payment system. In 2016 and 2017, a lot of new cryptocurrencies evolved.  With the evolution of new currencies and the increasing price of the existing cryptocurrencies, cryptocurrencies were no longer a payment system, people started using them as a digital asset. These days cryptocurrencies are popularly called crypto assets.

Do Whales Manipulate Cryptocurrency Market?

One of the biggest fears for a common crypto investor, trader, or user is the manipulation of cryptocurrency price, mainly by the whales.

The whale is the term used for the big investors in the business, investment, and finance world. There are whales in share markets, real estate, as well as cryptocurrency markets.

In May 2021, Bitcoin and most of the cryptocurrencies reached an all-time high. But China banned cryptocurrency transactions and cracked down on mining operations which pushed the crypto market to a bearish run.

The price drop was also blamed on Tesla and SpaceX owner Elon Musk, who said he will not accept Bitcoin for Tesla because of the use of coal energy for mining.

Few weeks later, Musk again said he is willing to accept Bitcoin for Tesla provided clean energy was used for mining. His statement sent positive signals and the price improved slightly.

Whales can manipulate cryptocurrency price but there are also other factors that affect the cryptocurrency market.

How Elon Musk Can Manipulate Cryptocurrency Prices

When we talk about crypto whales, we must not forget Elon Musk. He has invested heavily in Bitcoin, Ethereum, and Dogecoin.

Elon Musk is an interesting character. He is intelligent as well. He has always created something new, something interesting. He co-created PayPal. Now, we all know how useful is PayPal. He established Tesla, the world’s best luxury electric cars, and SpaceX, the space program that intends to send human beings to Mars. Musk is also passionate about cryptos and he has the power to move the market. In fact, he has done this multiple times and has been summoned by Security Exchange for his alleged role in market manipulation.

Currently, Bitcoin is about $42K. If Musk announces that “this is the time to buy bitcoins and I have invested 1 billion USD in Bitcoins,” the price of bitcoin will go up just in a few hours. This possibility cannot be ruled out because he has done a similar thing in the past.

First published on Trendri, in author's name