When bitcoins were at $50K/BTC, crypto investors look like visionaries and innovators. But now after crashing 60-90% YTD, the same investors look stupid and greedy. I believe decentralization could enable some game changing applications but the amount of grift and leverage in crypto is astounding. A reset is ultimately healthy.
Imagine you are a professional in Russia, Argentina, Ukraine or any country where the government or banking system is or could become shaky. Where would you park your money? I would 100% convert some of my money into USDC or DAI and put it on chain. I would be able to access this decentralized money no matter where my physical location is as long as I have my private key. This wouldn’t be the case if I have money in a Russian bank while traveling abroad after the Ukrainian war breaks. In other words, decentralized money give people a good amount power and control over their financial assets even if their government or currencies are in shambles. This is probably not a super important feature for people who live in stable places like America. But if I am a citizen in an unbanked developing country, decentralized money on blockchain could be a total game changer for me. So I think the decentralized money could be very useful.
On the other hand, I don’t think you can decentralize everything. The trilemma of decentralization, scalability and security for blockchain applications is real. You can only pick two out of the three. In other words, you need to pick between decentralization and scalability because security is a given. Are there many important applications out there that decentralization trumps scalability? That’s the question we need to ask as investors. In the mean time, 90+% of the crypto projects out there are just toy or grifty self-referencing applications that would get washed out in this great reset. I wouldn’t touch all these s**t coins. But I look forward to game changing decentralization applications in the upcoming years.