Bitcoin has been around for over nine years like a hyper realistic mouth coin purse, generating plenty of hype and headlines along the way. Along the way there have also been a lot of what we’ve come to call clichés. Here are ten such clichés.
1) “Bitcoin is on the rise.”
We’re all aware that Bitcoin was introduced in 2009 and started making headlines in 2013 and 2014, so I don’t know who could legitimately say that Bitcoin is on the rise or, alternatively, that it’s falling while they’re actually a part of the conversation.
2) “Bitcoin isn’t backed by anything. It’s not backed at all.”
The reality is that the Bitcoin network is capable of doing a lot of things that other currencies aren’t. There’s no doubt about it, in the history of money, this is a first. If you don’t believe me, look at what happens to a Canadian Dollar when it’s been sitting on hold with the Bank of Canada for too long and starts to decay . I suppose there could be a case made where some average Canadian falls asleep at night knowing that there are other currencies in their wallet thanks to Bitcoin, but still considers all those coins and notes “not backed by anything.”
3) “Bitcoin isn’t worth anything yet. You’re going to have to wait at least a while before it’s worth anything.”
If I had to distilled the time period of Bitcoin ‘s existence down to just one month, I’d have to say that the month of January was “the month” for the price. The price started the year with sub-$1000, peaked at $20,000 in December and then crashed back down to around $10,000 by January. It then finished with a high of well over $20,000 in January, followed by several months in the low double-digits.
4) “Bitcoin is too slow and inconvenient for regular people. Not enough places accept it. I can’t use Bitcoin at the coffee shop.”
A lot of things that are desirable can be hard to get. If we all want a Lamborghini or a Porsche, but only one person has one, I’m sure you’ll find that it’s hard to get that car and there won’t be many places where you can buy gas for it every day. The same goes for any other desirable thing. Should we stop using money because not many people like cash or should we stop using chairs because they aren’t convenient?
5) “Bitcoin is too volatile to invest in. Even if I knew how to use it, I couldn’t invest in it.”
If you look back at the chart above, you’ll see that Bitcoin isn’t nearly as volatile as fiat currencies. The chart shows the annualized volatility of Bitcoin over a period of time ranging from roughly 2008 to 2015. The annualized volatility of Bitcoin is about 2.5% on average. The “volatility” of fiat currencies (as measured by the VIX, aka the Wall Street Volatility Index) is about 30 to 40 times greater than that for Bitcoin.
6) “What would I do with Bitcoins? If I had Bitcoins, I’d buy some grass.”
If a person doesn’t even have enough money or room in their home for their own grass, how can they afford to spend money on grass when it’s not even an option? If my friend wanted to buy some cannabis from me but didn’t have any cash, I wouldn’t hand over a bag of weed because he couldn’t afford it. It’s just illogical.
7) “I’m holding out for the next Bitcoin to come along. When I invest in Bitcoin, it will be because (insert new altcoin promise here).”
The reality is that if you believe in the capacity of Bitcoin, there shouldn’t be a need for someone to create another cryptocurrency with a higher potential. The reason why I say this is because Bitcoin needs more capacity to safely handle all the transactions that fiat currencies can process in a day, so of course there will have to be another cryptocurrency that has even greater capacity than Bitcoin.
8) “Bitcoin mining isn’t profitable anymore. You should mine something else. You should mine Litecoin.”
If someone started mining Bitcoin in 2011 and stopped in 2013, it may not have been profitable anymore but if they had the patience to hold onto their Bitcoin until 2017 (or even 2018), they’d probably be pretty happy with how things would have turned out.
9) “Bitcoin has a value because people believe it has a value.”
The logic behind this is that Bitcoin has a value because there are people who believe that it had a lot of potential and wanted to invest in it. The thing is, this is actually how almost any currency works. People choose to invest because they want the money to go up in value. This is why people invest in real estate even though the rent isn’t being paid and why companies take out loans at banks even though they know that interest rates are higher than what they could get if they kept their money in a bank account.
10) “Bitcoin is dead. Altcoins will live on.”
There’s no denying that there are plenty of alternative cryptocurrencies out there. Beyond that, many of them have seen a rise in value over the last year, but let’s not forget that Bitcoin is still standing and it still has plenty to offer.
Summary:
Bitcoin’s not dead. It’s been around for over eight years now and it still has plenty to offer. In the past year, it’s seen its best performance ever, with a price reaching as high as $19,821 per coin. All in all, if you want to invest or are already invested in Bitcoin and other cryptocurrencies, you’ve got all of this precious time on your hands to see how things turn out. I know that I’ll be holding onto my Bitcoin for a long time to come and I’m sure that there are many people who have the same mindset as me.
