I believe there’s a Paradigm Shift that is about to happen in Cryptocurrencies – from blindly ignoring the costs, to embracing sound financial principles, particularly when it comes to how a Cryptocurrency is structured.
Many investors who buy into Cryptocurrencies are trying to get out of the Fiat Money system that is massively controlled, inefficient, and where Central Banks are right now printing money like crazy.
But Cryptocurrencies Print too.
I need to start with the basics, because I honestly don’t think hardly ANYONE investing in Cryptocurrencies understands even the basics.
- A Cryptocurrency is a Computer Program, running many computer programs, where thousands of computers work to solve the blockchain – providing speed of transactions and security by providing massive Computing power.
- With most Cryptocurrencies, these computers providing this massive computing power, COST MONEY. They are PAID by the Cryptocurrency program “Printing” new currency every block, and giving it to the computers that solve the blockchain.
When Cryptocurrencies Print Currency and give it people other than the owners, that DEVALUES YOUR CRYPTOCURRENCY.
What is this Cost?
Bitcoin – 4.38% annual devaluation.
Ethereum – 7.73% annual devaluation
Litecoin – 11.03% annual devaluation
Monero – 13.46% annual devaluation
DASH – 18.94% annual devaluation
ZCash – 183.62% annual devaluation
PIVX – 0.49% annual devaluation
These costs are staggering. If the promoters of Cryptocurrencies were treated legally the same way as Financial Advisors, and failed to disclose these actual costs to you, the investor, they would lose their license, or worse.
There are newer coins and methods of doing Blockchain Computing that many believe are just as safe as the traditional method (called Proof of Work) but require significantly less energy.
The economic problem with this blockchain method called “Proof of Stake” is that it requires many computers of many owners of the Cryptocurrency to continuously “Stake” – leave their Wallet open to act as blockchain Validators, and provide massive amount of Consensus for the Proof of Stake system to function securely.
I’ve found a Cryptocurrency that solved this challenge. It has the amazing features that I love about my 3rd Favorite Cryptocurrency - DASH (Monero is my 2nd favourite for it's amazing Privacy). It has a Masternode System that performs instant transactions. It has a Treasury System that’s continuously funded (most coins are just funded by paying their developers on ICO – what’s the incentive to stick it out?) to make the Currency more and more robust over time.
But PIVX has a feature that no other Cryptocurrency has – it PAYS YOU TO OWN IT. Let me repeat that. Instead of DEVALUING your Currency by printing and giving it to someone else, it prints currency and gives it to YOU, just for “Staking” (the same function in POS equivalent to mining).
HOLY COW – JUST NOW, while writing this article, I just got a ping from my PIVX Wallet – 2.02 minted coins deposited into my wallet!
Wow.
THAT is the feeling! Getting paid just to own and keep my Wallet Open and running 24/7 as part of the Security / Consensus / Validating process of my Blockchain. THAT is what PIVX is all about. It’s a community of people working together to create a Cryptocurrency that pays/incentivizes its ownership, not some Miner Rig in Rejkjavik contributing to global warming.
Why would you own a Currency that devalues, some at 10%, 19%, 184% per year, when you can own one that pays YOU?
When the market figures that out..........
.......
Also check out my detailed Macroeconomic Analysis of where Cryptos are going:
https://steemit.com/cryptocurrency/@cryptonomics/the-coming-crypto-superspike-this-bubble-is-small-compared-to-what-s-coming
THanks for this info, very helpful and insightful!
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