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The Wrong Way to Understand Cryptocurrencies and the Blockchain

By William Mougayar

As the circle of general public awareness around cryptocurrencies grows further, additional new opinions from newcomers start to get formed around what they represent and what they don’t.

To use an old analogy, cryptocurrencies and the blockchain are like a big elephant. If you come to it with your eyes blinded and not knowing what to expect, your first impression will depend on what part of the elephant you have first touched. 

First impressions matter. And one of these first impressions we often hear about cryptocurrencies is bewilderment that they aren’t backed by anything, followed by the deduction: “how do they amount to being worth anything”? 

Newcomers are deducting these early impressions, based on their partial experiences as the whole truth. But the reality is far from it. 

Then, these distorted thoughts are amplified when we hear a public figure calling “crypto a crock” at a US House hearing, or when we read ludicrous reports trying to explain why Bitcoin Could Fall Below $1,000 with preposterous claims like “there is no value in it.” 

Of course, like anything in life, our current traditions influence and limit the optics of how we see things. 

We are used to governments being the sole sovereign backers of national currency, and we are used to relying on financial institutions as the sole providers of sacrosanctity on financial transactions, because all roads lead to a bank or a government. 

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