Monday 22 March 2021 11:07 am

Cryptocurrency can help take us across the tipping point of a new era

It all started off as a game: the novelty of trying something disruptive, outside the stuffy old stocks-and-shares box. There was a bit of FOMO in there too, because of course you aren’t cool if you don’t do crypto.

This was the scene back in 2016 when I bought my first Bitcoin. My dad was alarmed, wondering if I needed crypto to buy drugs! Bitcoin’s main association at the time – especially among members of the older generation – was with the dark web and black market.

Up to 2018, it was a fun ride. I got really into it, poring over white papers, talking to crypto leaders and attending dozens of conferences worldwide to share my own insights into crypto. It was around this time that I started interviewing some of the main players on my TV channel FinancialFox. Some of the crypto masters I met at that time remain my mentors and gurus today.

The bottom line for me was the new perspective on the value of money, how transactions are processed, and most importantly, the concepts of decentralisation, access, transparency and democratisation of wealth.

Like many others, I got swept along with the ICO craze and witnessed the boom in token sales. Crypto projects were popping up like mad and disappearing just as fast when the bubble burst. I look back on 2016-2018 as the wild west of crypto!

Then… silence. In 2018 the Bitcoin price collapsed and other cryptos followed suit.

Fantasy bubble

Despite the collapse, it hadn’t all been a fantasy bubble. Even in the early days of the internet, the ‘money revolution’ was already brewing. The space kept evolving and the coolest people I’d met carried working on their projects, notably Cardano – a solid project backed by years of research. Cardano’s skilled team and inspiring leader are on a mission to democratise the world, empowering the billions of unbanked.

Now here we are in 2021, the tipping point into a new human era, having endured a world-changing pandemic which killed many and transformed our lives forever.

The arrival of COVID-19 put the world on pause, spurring innovation and driving new technologies. The global economy suddenly ground to a halt, with trillions being pumped into the system via government stimulus packages as the much-debated lockdowns forced people to, essentially, live on the internet.

March 2020 saw the one of the biggest stock market crashes in history. Investors turned to trusty old gold and tech stocks went through the roof. The clever and brave ones, however, dived into bitcoin – the new safe heaven asset. Ethereum followed.

Bitcoin boomed

The concept of decentralisation started to make more sense, inspiring the new DeFi (decentralised finance) movement. Bitcoin boomed, reaching all-time highs, and new projects were born, promising new ways to make money.

We finally realised that money isn’t what we have in our bank or pocket.

Amid money printing, inflation, recession, unemployment and market uncertainty, people needed new ways to invest but also to make money. When you can’t go to work and you are not even sure your job will be there afterwards, what can you do?

Many found the answer in crypto and DeFi. I took the DeFi path myself late last year and found a place where making 10 times your money is not just a dream. This stock market on steroids also enables you to earn money by staking and providing liquidity. Yes, I had to skill up, learning about fund transfer, wallets, Layer 2 protocols, Metamask, Blockifi… but it was fun and exciting.

Even so, there was a catch: transaction costs were far too high. We all like Uniswap but agree that it is too expensive. The Ethereum Network started to show its scalability limits in handling multiple transactions and applications. Then, Layer 2 protocols came to the rescue, offering solutions to streamline the process with low and fast fees, making the user experience more seamless. I am a big fan of Polygon (formerly Matic Newtork), now also trading on Coinbase.

Other excellent projects such as Polkadot and Cardano opened up the space to more interoperability and composability, offering new opportunities for the crypto space to grow.

The huge milestone was when the space opened up to the big boys: Elon Musk and Michael Sailor joined the crypto party, more institutions took a position in Bitcoin, and some tried the DeFi space. Then, Coinbase listed on NASDAQ.

Gaining legitimacy

The previously stigmatised crypto was gaining legitimacy and credibility with big-name endorsements and support (‘Bitcoin, a hell of invention’ – Ray Dalio), finally being recognised as alternative store of value. Even though volatility remains and security is still a concern, crypto is now increasingly accepted as a form of alternative investment.

Now, it’s Non-Fungible Tokens (NFT) mania.

NFTs were born as a way to tokenise and monetise digital art, gaining popularity on platforms with  selling anything from videos, music, toys and pictures. The artist Beeple has set a record, selling his Everydays masterpiece for $69 million via Christie’s digital auction, making him the first and as yet only millionaire digital artist.

The concept of digital assets and ownership seems a great solution for digital artists and collectors; but questions remain: How can I separate ownership of a physical painting from its digital representation? What is the use of the digital version?

Last week on my online channel, I had an insightful discussion about NFTs with Dr Julian Hosp, blockchain entrepreneur and CEO of Cake Defi. I was fascinated by his theory and the key concept of the history of digital assets, which is the real value of NFTs. In the end, this is what it’s all about: stories, feelings and emotions.

It is also the birth of a new asset class, attractive to the younger generation of investors who value full ownership over buying into big corporations. Definitely a space to watch, as NTFs have still to show their potential with new uses cases and utility.

To end, yes, the world is undergoing some crazy changes, but if we get back to the fundamental values of decentralisation, empowerment and essence of money, it all makes perfect sense. The crypto movement started from the bottom, has risen to gain attention of the big boys, and will eventually become mainstream. Its beauty lies in empowering people to take control of their wealth while encouraging diversity. Women now represent a large proportion of crypto traders.

We are in the middle of a money revolution, leading to a new system where perhaps central banks won’t control our money anymore and the government will engage more effectively, focusing on protecting people’s rights and guaranteeing security and peace.

Crypto education still remains a big challenge, and successful projects will be those built for the people and not for themselves. This is really what I like about Cardano.

It is hard to predict how exactly this will all unfold.

The other day, my dad asked if I could help him get some Bitcoin. I smiled.