Valentin Schmid, Business Editor at The Epoch Times and Richie Heckler, Chairman of Crypto Working Group.
Posted by BoldTV on Monday, August 27, 2018
Why has the cryptocurrency market gone down?
Richie Heckler, chairman of the Crypto Working Group, said that there was a big bubble in cryptocurrency, and the cryptocurrency market has suffered a correction because of that. But we expect it to go back up; everything that goes up has to come down.
Is there any intrinsic value to cryptocurrency?
The technology of cryptocurrency makes it easy to move money around due to its underlying tokenization. When you can move money around faster and easier, it is more economical — making it better for the economy.
Heckler compared current market in cryptocurrency to the dotcom bubble when there was a new technology and many new IPOs entering the market. With cryptocurrency, it is a new technology and tons of new supply is entering the market as it is so easy to create a new coin, so, naturally, the market will have to go down. The main problem with cryptocurrency right now is that even with the $200 or $500 million, or the billion dollar coins, there is no product working. This distinguishes cryptocurrency from the dotcom market that had a product but it wasn’t profitable yet.
“It’s an amazing thing when something that doesn’t exist is worth a billion dollars,” Heckler said.
The price of cryptocurrency is going to fluctuate until there is a clear demonstrable value for what it is.
Who are the users for cryptocurrency?
According to Heckler, the balance between institutional investors and average, individual users is in a transitional phase. Many of the crypto-originals have cashed out, and the institutional capital hasn’t entered the market because the infrastructure is not there yet. In the next few years, when the infrastructure is there, the institutional capital will come in and the value will go up.
Valentin Schmid, business editor at The Epoch Times, agreed that once infrastructure issues such as custody and reporting internal risk management — which is not there yet — is in place, the institutional capital will be there.
How can cryptocurrency be secured?
A major issue with cryptocurrency is not its underlying value but the problems that come with holding it. An example was an individual whose AT&T account was hacked twice, and he lost $25 million. Heckler acknowledged that the security of cell providers is terrible in general; lines can be ported out and email is no more secure. Schmid disagreed, saying there are security measures available such as printing out the paper wallet and distributing it among three users and then setting it up such that all three pieces are necessary to access the wallet.
Heckler agreed that these methods, although “old school,” can make cryptocurrency relatively secure. On the other hand, general security in the economy is bad. For example, approximately one-third of all people have had their personal data hacked. It’s not just the crypto world, the whole world is insecure as far as data is concerned. As far as cryptocurrency being insecure since it has value and relatively few of the checks and balances that the banking system has, thieves are drawn to hacking crypto. That’s the beauty and the curse of cryptocurrency, it’s easy and fast, but once it is gone, you can’t get it back.
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