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1/ In 2017-2018, a lot of people said that you'd know the crypto bubble was over when all the garbage got washed out of the market. At the time I agreed with this, and repeated it a little too eagerly.
2/ I now realize this is completely wrong, and it stems from a common category error that pops up all over crypto. Repeat after me: TOKENS 👏 ARE 👏 NOT 👏 EQUITY.
3/ Dead companies go bankrupt. They stop paying taxes. They release claims to their IP. Once the pilots are gone, the company itself is erased and its stock becomes worthless.
4/ This is not true in crypto. Cryptocurrency networks cannot go bankrupt. Most of them have 0 marginal operating cost. No one has to be in the cockpit for these coins to continue trading.
5/ As long as there are miners, speculators, pump and dumpers willing to trade them, they will continue to exist. And as long as those people pay fees, exchanges will continue to list them. And as long as exchanges have trading volume, CMC will list them.
6/ The party just keeps going. No one is incentivized to ever turn off the music. And why should they? In a sense, crypto coins are the ultimate evolution of penny stocks—even when they die, they can continue to be speculated on and manipulated.
7/ Even when the market "rationalizes," so long as there are people who want to monetize their GPUs or pump and dump coins, exchanges willing to list the coins, and retail speculators willing to try their luck, this stuff will always exist.
8/ Just make your peace with it.
9/ So what you should look for is not shitcoins getting washed away. Instead, you should look for a larger and larger separation between the real stuff and the garbage.
10/ The digital money and valuable digital commodities will pull far ahead of the penny stocks in terms of value and trading volume. We're already seeing it. FIN
