I BOUGHT $1,000 WORTH OF CRYPTO CURRENCY. IT TAUGHT ME A PAINFUL LESSON

Jun 6, 2021 0 comments

The only thing worse than a Steve Jobs fanboy is an Elon Musk fanboy.

That’s what I would have told you in 2018.

Fast forward to June 2021 and – though rolling up to a date in a Tesla Model 3 (while chatting to your Reddit bros through your AirPods) is still probably the world’s most effective contraceptive for men – more and more people are becoming crypto-curious.

Internet punters are proudly identifying as “idiots” (and making crazy amounts of cash) and institutional investors, seeing the insane gains being made out this mass delusion, are being tempted into the waters, in a move that has provided the sector with long-awaited legitimacy, as part of a grand scheme to overhaul the entire financial system, rewarding the heroes brave enough to get in first…

That’s what hardcore cryptocurrency advocates want you to believe, anyway.

Though many experts see it more as a glorified Ponzi scheme with some potential to do good (even the founder of Ethereum, Vitalik Buterin, recently played down cryptocurrency’s ability to radically solve the world’s problems on the Lex Fridman podcast), what’s not up for debate is that the sector has been trending hard in the news.

Why? Everyone wants to get rich quick.

Alongside the work from home revolution (and loneliness crisis) of 2020, Bitcoin quadrupled in value. Meme-coins like Dogecoin have blown up too.

This has happened as online communities straddle murky waters, where genuine friendships appear to be built between users with a common goal of getting rich quick. The problem? One never knows how much of this is real friendship, and how much of it is purely designed to manipulate vulnerable, lonely people into trading their money for hot air.

The cynics would say it’s all cupboard love, the proponents would say there is a real sense of community – a real bonding over a common disenfranchisement with the traditional finance system – even if everyone involved is aware there is no true value to the coin they are buying, beyond the hype.

In any case, the sector is booming in the public imagination, fuelled by success stories, and the fact that no one hears about the other thousands of people who lost money.

As CNBC reported in May, “A $1,000 dogecoin purchase on Jan. 1, 2021 – at a price of less than a cent per coin – would be worth $121,052 at Wednesday’s high of 69 cents, a gain of more than 12,000%.”

That’s significantly more than other cryptocurrencies like bitcoin and ether, which grew 95% and 369% over the same time period, respectively. A $1,000 bitcoin purchase would be worth $1,953.88 as of Wednesday, while ether would be worth $4,686.58.

It was in this environment that I decided to cash in on the hype. After all: if there are two things you can count on in life, it’s human greed and stupidity. Right? So on May the 11th, I bought $1,000 worth of various cryptocurrencies, for the sake of journalism…

Though many in the world of traditional finance are giving the crypto sector a wide berth for fear of giving it legitimacy, I thought I would dip a toe into the waters and attempt to provide a non-judgemental, non-patronising (but also, hopefully, a non-shill) take on what it’s like to invest in crypto currency in 2021 as a complete rookie.

To do this, I split my money between stalwarts Bitcoin and Ethereum, as well as a bunch of highly speculative joke coins, group-think schemes and newcomers like Dogecoin, Shiba Inu, Safemoon, Revain, Astro Pup and AC Milan Fan Token.

Before you throw your Australian Financial Review at my head and accuse me of giving scammers the hype they crave… hear me out. If I’m dumb enough to get sucked in; I’m probably not the only one. So consider this a public service announcement.

Anyway: with the disclaimer that this is not financial advice, and that if you want to actually keep your money you are much better off intelligently investing in property, ETFs or a well-rounded stock portfolio… here’s the story of how I spent $1,000 trying to take on the world of cryptocurrency degenerates – and your guide in what NOT to do with your hard-earned cash.

I don’t advise you to take on the world of shit coins (as part of my experiment comprised), but if you do, at least learn from my errors.

The experiment was simple: I took $1,000 and put it into a mix of random speculative cryptocurrencies, as well as a couple of well-known ones, and observed the impacts (on both my bank balance and emotional state) of joining these new online cults.

In the interests of sociological accuracy, I did not keep my experiment scientific. Much like the rest of the world, I allowed greed to overtake me.

Though I intended to put $100 into each coin I soon found myself believing I could pick the eyes out of the market, and began throwing a little more at some, and a little less at others.

Here’s what went down.

Sourced from dmarge.com.

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