Some Common Perspectives on Cryptocurrency

When I talk to people about cryptocurrency, I get a variety of different reactions. I have categorized these into four different categories, which I describe below.

The Optimist

“Cryptocurrency is a rocket ship! I’ve bought all of the crypto that I can. I’m long on Bitcoin, Ethereum, and all of the little coins that I can only buy on the shady exchanges. In five or ten years, Bitcoin will probably be at a million. Sure, there are crashes, but if you don’t hold, it will inevitably go up.”

This kind of person thinks Bitcoin is going to the Moon. It doesn’t matter that a single Bitcoin is over $30k right now, get in while you can! You saw a lot of these people a few years ago, back when Bitcoin first flirted with $20k. They bought cryptocurrency on credit, and got in on all the “shitcoins” they could. Back then, everyone and his cousin was creating new cryptocurrencies, and most of these turned out to be, well, nothing.

This type of person may even buy cryptocurrency just so they can say they own it, even if they have no idea how any of this works. But they have a lot of confidence that this will be their lottery ticket. Unfortunately, a lot of people lost money when Bitcoin crashed in 2018. Many of them are still bitter about that. Some of them are now the second type of person.