Introduction: cryptocurrency as a financial system is very young.
I think of cryptocurrency as a brand new investment and financial system. While Bitcoin is barely 12 years old, the modern banking system is at least a hundred years old, and some would say 300-400 years old. So in comparison the cryptocurrency system is child like.
Body: Cryptocurrency is full of prey and predators.
The famous American Wild Wild West was full of tragic stories of robbery, murder and other mayhem. There were to few police and to few laws in that great American Frontier.
Cryptocurrency is also full of tragic stories of robbery and theft. New forms of theft are common place and special words for new forms of theft have begun to appear. Terms like bridge hacks and rug pulls are becoming part of this new systems vocabulary.
This may sound harsh, but the truth is cryptocurrency is very complicated to figure out, and many people don’t know about all the dangers here. Many new investors are robbed in crimes of opportunity because they don’t understand they are putting their cryptocurrency in danger.
Crypto is complicated and if you invest before reading, and learning the dangers, then you pay for your ignorance with many expensive lessons.
Most new investors come here from the traditional finance system, where two hundred years of regulation snd policy offer basic regulations and oversight to protect investors. None of that exists here. The SEC and CFTC are locked in a battle for control, but so far have only issued announcements, but no legislation to actually protect investors in this space. It is like a new frontier, with plenty of settlers and very few Police. In cryptocurrency you are your security, and your knowledge is your protective regulation.
You get to be your own Bank, but with this new freedom comes great personal responsibility. You wear many hats and fulfill many roles. Bank President, accountant, navigator and scam detector.
Conclusions:
Cryptocurrency is an amazing technology, and it has great potential to become a wonderful financial system. But right now it is lacking protective regulation and meaningful enforcement. It is like the Wild Wild West, where your protection and security are your responsibility. Many unwary investors come here from traditional financial systems and assume those rules and protections apply here. Many invest large sums of money before they fully understand the risks. Then they become prey to the multitude of predators in the immature financial system. Education is key and a basic understanding of blockchain, tokens and blockchain explorers is important to prevent the loss of all of your funds. I strongly suggest that you invest in a sound education before investing your money.
