Crypto Character
Some made millions and a few even made billions of dollars buying and trading the new Cryptocurrency. If you are unfamiliar with Crypto let me start by clearing up any possible confusion. Cryptocurrency, as defined by the web, is: “a digital currency in which transactions are verified and records maintained by a decentralized system using cryptography, rather than by a centralized authority. Decentralized cryptocurrencies such as bitcoin now provide an outlet for personal wealth that is beyond restriction and confiscation.” Did that clear anything up?
Let’s try this definition: “Cryptocurrency is a digital currency, which is an alternative form of payment created using encryption algorithms. The use of encryption technologies means that cryptocurrencies function both as a currency and as a virtual accounting system.” Oh, encryption algorithms, right. Got it. Makes sense.
Ok, in all seriousness, I think the bottom line is if you can’t understand it, then buyer beware!
As you can tell, I don’t have a clue as to what cryptocurrency and bitcoin are or what they do. One broker writes that, "Each Bitcoin (same as crypto) block takes 10 minutes to mine. This means that in theory, it will take just 10 minutes to mine 1 BTC (as part of the 6.25 BTC reward). However, before you go choosing your Lamborghini, it's important to know that for every block, there are thousands of bitcoin miners each competing for the same profits.”
Alright, alright, I’ll stop trying to explain what crypto is and how it works. However, one thing I can explain is how so many lost everything and a few made millions. Don’t stop reading…this is going to get good!
When this currency first came out there was very little risk. Prior to the drop in the stock market, those who bought cryptocurrency early and then got out when it was at its highest return on investment, made a lot of money; many made millions and some billions of dollars. Some of my friends and family members got in early. They all encouraged me to do the same but I was too busy to even consider investing.
One family member chided me and said to just put $500 in and forget about it. He explained how quickly he was making money and how foolish it would be not to invest even a little. Why not? The risk was so low (he reasoned) "So what if you lose $500 when you can make $100,000 on that investment!” “Low risk, great reward" was their motto. So many were attracted to this new investment machine that could make someone so rich that they could retire at 30 years old—and some actually did make that kind of money—but many lost everything.
Here’s what and how it all happened. Cryptocurrency is based, like I said, on an imaginary asset. Now, some will argue that it is based on the amount of electricity or energy that it takes to develop or create a ‘block’ of energy that represents a financial measurement. Think of these blocks of energy or profit as blocks of gold. The only difference is that you can feel the weight of gold; cryptocurrency is only felt in your mind (or someone else’s). Those who created cryptocurrency were ingenious. Those who fell for it were ingenuous. What’s the difference? Someone who is ingenious is smart, clever, original, or inventive. Those who are ingenuous are unsuspecting and naïve.
The book of Proverbs chapter one describes this type of person as a ‘simple’ person. The Hebrew meaning of this work expands this meaning to a person who is empty-headed, gullible, easily enticed, and a fool. Chapter one of Proverbs also describes a father’s warning to stay away from those who promise ‘get-rich-quick’ schemes. It doesn’t matter if you make a lot of money. The ends never justify the means. God won’t bless profits when it is obtained through greed. Proverbs 23:4 and 5 reads, Do not labor to acquire wealth; be discerning enough to desist. When your eyes light on it, it is gone, for suddenly it sprouts wings, flying like an eagle toward heaven. This speaks volumes about what we invest in and why. The best type of gain is always little by little, through consistent, faithful, hard work. God always blesses this approach to work—and it’s healthier for you.
But there’s more to this story. What people didn’t realize was that the government wasn’t going to sit around while people made millions of dollars without their cut in the game. So, they decided to tax the profits of these unsuspecting investors. Each time they sold their crypto and then reinvested, they were being charged a tax. When the bottom fell out and Crypto lost 80% of its profits, the investors were left with a large tax bill with no way to pay for their taxes. I think this is what Solomon was trying to convey with his warning, Do not toil to acquire wealth; be discerning enough to desist. When your eyes light on it, it is gone, for suddenly it sprouts wings, flying like an eagle toward heaven. ~Proverbs 23:4,5.
Let us instead devote our time and energy to living in this world with an eternal-mindset. As I Timothy 6:6-7 says, godliness with contentment is great gain. For we brought nothing into the world, and we can take nothing out of it. How much greater to live with this perspective!
