Let's start with the basics and keep it simple, as it's precisely why we won't be participating in it. The whole thing is run by people who are recklessly incompetent and/or criminal. The only reason it is still in existence is dubious at best, but largely boils down to the fact most crypto enthusiasts struggle with the idea that financial assets have matching liabilities and find the concept of a balance sheet quite mind-blowing, or recognize it for what it is and use tit to line their own pockets from a globe full of suckers.
Crypto sells nothing for so long in return for more lumps of nothing that many are convinced that buying nothing and trading nothing to which a name is slapped on gives value to nothing.
Crypto then uses this illusion by "jacking up the illusion of value" by increasing the buy in for whatever "brand" is presented as "even better" combined with a little bit of back and forth trading with "friends or suckers" gives some sort of enormous value to said nothing.
Crypto therefore relies on the inflow, not outflow, of real money rather than "the technology" to create the illusion of being somehow "special" as a community of traders as an illusion of freedom and the delusion that said nothing has any real value to them as a whole when it only has value in the real money that goes only those who control and own the Crypto brands at the top.
How Crypto falls into this is rather simple as it's all in all it is equal parts clever and dishonest. Aside from having been overhyped, which anytime something is overhyped, it tends to be a scam in and of itself, with excessively misleading terms and concepts, its origins are even blatantly lied about.
7 Main Facts:
Crypto is not a real currency.
Crypto is useless as a unit of account.
Crypto is not a reliable store of value.
Crypto is not a hedge against inflation.
Crypto is not a medium of exchange.
Crypto is not a new financial system.
Crypto is not a new internet.
The fact is, everyone who keeps pushing it are either knowingly lying to you or they do not know what they are talking about. These are the same types of people that claim they are creating their own "metaverse" when all it is in factuality is a virtual world space being used as a front for these crypto-scams on one hand and to compel the masses to conduct all real world activity through a virtual platform. The "Real Metaverse" as previous posted is just another name for the internet. You do yourself and everyone else a favor by not getting involved with those who "brand" themselves a metaverse because again, such are either knowingly lying about it, or they don't know what they are talking about.
Where it all really comes from:
This is going to surprise some, while those of the older generations are well aware of these basic facts. Some, even of the older generations, may have not realized it themselves, that these are the parts that were pooled together to create the old scam with current technology. Those who haven't been suckered into it are those who are intelligent enough to realize anything that is overhyped is already a scam waiting to be exposed. That being said, let's get into the "cryptocurrency" as it originally was fictionally perpetuated.
It comes from a myth about 'Secret Swiss Bank Accounts.' The myth is that various spy networks, crime families, and corrupt politicians would place funds into "secret offshore accounts" that can only be accessed by having a "secret special code" and not using any other form of ID, and without that "secret code" access to those funds would be impossible. (The reality is, the beneficiary of the funds must also be positively identified, and if, for example, the source of the funds came from an American source, then any owed taxes can be collected and seized by the IRS, so the tax evasion bit is also a myth).
This myth has been perpetuated in various spy and crime novels for so long and even reflected in movies and games that it has been considered a reality but is in fact a fiction, but is the inspiration behind the very concept of "secret/crypto" funds.
The actual manner in which "untracked" money was passed around was often in the form of physically exchanging between criminals such as precious metals like gold and silver or gems like diamonds or physical cash currencies at secret locations like one often sees in mob movies and drug deals, or using shell companies (fronts) to exchange currency as inside trading and money laundering.
The origin of the digital currency is the second part based on the invention of credit cards which are far older than one realizes. It actually goes back to two things. The first credit card was created in 1950 and then was later followed up by the concept of E-Cash.
Invented in 1950, the Diners Club card is known as the first modern-day credit card. The idea came from Frank McNamara, a businessman who'd forgotten his wallet while out to dinner in New York.
Ecash was conceived by David Chaum as an anonymous cryptographic electronic money or electronic cash system in 1982. It was realized through his corporation Digicash and used as micropayment system at one US bank from 1995 to 1998.
The two concepts eventually became the basis for the credit system by authorized central banks ever since, and why over 97% of all financial exchanges are digitized as a means of suffering huge losses of physical cash by various causes such as real world fires and bank robberies. That's the basic part of it all. The other is from the game industry. Originally games had a score system only, where the goal was both to beat a game and its levels, but also to get the highest score, which allowed end users to enter in their gamer name or initials to bunk others down the top 10 highest scores as bragging rights. How companies monetized their game titles was through game console sales, and old game cabinets using nickles, dimes and quarters that different arcades bought or leased from those vendors.
Eventually, a new concept was implemented as a way for small startup companies to find a way to monetize their titles as independent studios using a concept similar to the previous but took root when online gaming become possible.
Points were no longer just something you gained from beating challenges to unlock features. They became spendable points to unlock those features for that specific title, and the developers alone had ownership of whatever they named those virtual coins.
The option was expanded so that end users could earn those points or buy "recharges of them" to gain various merchandise in the game and only in the game for the game and various additions to their characters like clothing gear, and so forth.
This then was expanded to split the concept into tokens as reward points for completing specific challenges to unlock features or options as that could not be traded with others, while the spendable purchased points were defined as credits that would usually be 4x more valuable than earned tokens and could be traded because real money was used to get them.
This was then expanded by some to have these tokens and credits merged with authentication codes for that specific player account as proof of purchase receipts along with their gear and items associated with that account, and create a virtual economy of sorts so that creators of those accounts and their "assets" could trade or sell them to someone else as ready-made.
How Crypto currencies work is by combining all these concepts into a scam, played off as a gamble combined with a Pyramid Scheme by combining all these things into one fictionalized monstrosity that pretends to be legitimate. The claims that such as Bitcoin is the oldest of cryptocurrencies is just one of many examples of the fraud. In fact, there were many predecessors which can be called test runs and why you should never touch crypto ever.
Ecash, created by David Chaum,1982.
E-Gold, created by Dr. Douglas Jackson and Barry Downey,1996
Hashcash, created by Adam Back, 1997.
Bit-Gold created by Nick Szabo, 1998, which eventually became Bitcoin in 2009.
B-Money, created by Wei Dai, 1998.
Investigating the Fiction: Using Real Journalism
The whole story of the bitcoin founder being someone named Satoshi Nakamoto and buying a pizza using bitcoins is complete fiction. The reality is this was a private community of developers, and those who have claimed to be this character are in fact themselves scammers. The creator of the story was Hal Finney who was an American software developer that passed away on August 28, 2014.
He claimed to have been the first to have received the first 10 bitcoins transaction from bitcoin's fictional creator, on January 2009, which could only have been Nick Szabo, after he got help from Adam Back and rebranded Bit-Gold to Bitcoin. It would originally have simply been developers as part of Bit-Gold creating a test run of the viability and vulnerability of bitcoin and its blockchain infrastructure.
The whole claim about a pizza being bought using Bitcoin is itself is a fraud. To create the illusion of value without providing the actual details. Originally, these 'Bitcoins' were only "valued" at 0.01 (one cent) in US currency as a compnay stock investment for a potential decentralized credit system model. So 10,000 of them would only have equaled about a $100 total investment.
On May 22, 2010, now known as "Bitcoin Pizza Day," Laszlo Hanyecz agreed to pay 10,000 Bitcoins, for two delivered Papa John's pizzas.
Since Papa John's didn't accept Bitcoin as payment, he posted a 10,000 Bitcoin offer on Bitcointalk.org for those pizzas.
It was a person named Jeremy Sturdivant, a 19-year-old at that time, that took the offer for an estimated $41, bought the two pizzas himself and delivered the pizzas.
So Jeremy Sturdivant spent $41 out of pocket, acting more as an investor in exchange for a $100 stock in fictional currency.
And that is how the scam at its core actually works. Now, whether or not it was Nick Szabo who personally used the fictional Username Satoshi Nakamoto, or one of his employed or participating developers on his behalf who Hal Finney personally knew, so far was taken to the grave by Hal Finney in 2014. But the point is in all of this is it has been a false story as to how it came about and all the players behind it that are still alive are the ones who are getting the majority of the funds using the same method Jeremy Sturdivant participated in, though his action itself wasn't a crime because he used his own money to buy those pizzas in trade for gamer coins more or less.