I Could've Easily Fallen for Cryptocurrency Myself

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I was looking for a new topic to write about. Apparently, my post on Robin Padilla who I didn't vote for but now agree upon (read here) is catching wind on Facebook. However, I didn't want to resist writing about the cryptocurrency hype. I recall some of my biggest mistakes aside from letting a family friend buy in huge credit or taking offers without asking. Another thing that I could've gotten into is cryptocurrency. The reason is I've been into hype-riding, praise addiction, or afraid of being left out. It didn't matter how much theoretical information I learned if my temperament is bad. As Warren Edward Buffet said the following:

The most important quality for an investor is temperament, not intellect. You need a temperament that neither derives great pleasure from being with the crowd or against the crowd.

The issue is people tend to take pleasure in going against the crowd or for the crowd. I've experienced both of them and who hasn't? I remembered wanting to take B.S. Information Technology only because it was the trend. I remembered going against the latest fashions because I find that the majority tend to be wrong. This is where temperament plays a role. Do you join the majority or minority because you take pleasure in going for or against a crowd? If so, it's time to change that. Countless innocents have been blamed for what they didn't do because of that. Some people become annoying minorities because of that. It's sticking to what's right. Besides, a lot of stupid things I did is because I decided to rely on intellect over temperament. You can be very intelligent yet fall for scams because of poor temperament. It's something I fight with daily because I tend to take great pleasure in either mixing with the crowd or fighting the crowd.

One of my previous articles was about why following the crowd is a bad idea (read here). Who doesn't wants to be left out? It's a very odd feeling to be left out. Yet, such mentality is the temperament of a child. Who can remember getting mad because everyone has this but you don't? I certainly did and I remembered I fought with my parents a lot over that. Even more, there are celebrities endorsing cryptocurrency. Celebrity endorsements can be good or bad. Liza Soberano is endorsing GCash. Globe has BTS endorsement. So far, GCash has been a reliable platform for Filipinos during this pandemic. I'm using GInvest to take advantage of the dips by investing extra money in the Philippine Equity Smart Index Fund (read here). If I continued in my mentality of not being "left out" then I would've decided to buy Bitcoins. However, the news left and right of Bitcoin falling apart is making me say, "No thanks!"

Charlie Munger, a business partner of Buffett even dares to call it a dirty sewer. The Markets Insider also gives this about Munger's view on cryptocurrency:

"I think anybody that sells this stuff is either delusional or evil," he said. "I'm not interested in undermining the national currencies of the world."
Warren Buffett's business partner, who has previously described crypto as a venereal disease and a tool for criminals, issued another damning indictment during the AFR interview.
"I just avoid it as if it were an open sewer, full of malicious organisms," he said. "I just totally avoid and recommend everybody else follow my example."
Bitcoin, ether, and other popular coins have plunged more than 70% from their November peak, sparking a wave of layoffs, record withdrawals, and bankruptcies in the crypto industry.

I think one of the reasons why people bought cryptocurrency is also because of social media gossipers. One article I wrote is about how social media gossipers make terrible financial advisers (read here). I think their "best source" is just "Trust me bro/sis" which is really not a valid source. The hype of cryptocurrency built itself up. It's pretty much what happened with the late Gerald Cotten of the Quadriga-X Scam (read here). Just watching the Netflix documentary Trust No One: Hunt for the Crypto King makes me think about how the hype allowed the crime to happen in the first place. Another example is the hype built by the missing Ruja Ignatova who was called the Bitcoin queen (read here). I'm simply thinking about the hype can be described by BBC News as:

Why have so many people continued to believe in OneCoin, despite all the evidence?
Investors often told us that what drew them in initially was the fear that they would miss out on the next big thing. They'd read, with envy, the stories of people striking gold with Bitcoin and thought OneCoin was a second chance. Many were struck by the personality and persuasiveness of the "visionary" Dr Ruja. Investors might not have understood the technology, but they could see her talking to huge audiences, or at the Economist conference. They were shown photographs of her numerous degrees, and copies of Forbes magazine with her portrait on the front cover.
The degrees are genuine. The Forbes cover isn't: it was actually an inside cover - a paid-for advertisement - from Forbes Bulgaria, but once the real cover was ripped off, it looked impressive.
But it seems it's not just the promise of riches that keeps people believing. After Jen McAdam invested into OneCoin she was constantly told she was part of the OneCoin "family". She was entered into a Whatsapp group, with its own "leader" who disseminated information from the headquarters in Sofia. And McAdam's leader prepared her carefully for conversations with OneCoin sceptics. "You're told not to believe anything from the 'outside world'," she recalls. "That's what they call it. 'Haters' - Bitcoiners are 'haters'. Even Google - 'Don't listen to Google!'" Any criticism or awkward questions were actively discouraged. "If you have any negativity you should not be in this group," she was told.

The lack of good temperament became a cause. I really felt that could've been me as well who fell for the Bitcoin scam. I've experienced bad purchases. I experienced being phished when I fell for an email scam. Cryptocurrency feels so legitimate (at first) but like every get-rich-quick scheme--it's too good to be true. Watching Cyber Hell: Exposing an Internet Horror also reveals another scary thing. The crime in South Korea also had criminals who accepted only cryptocurrency. I guess the use of legitimate cash makes it so easy to trace. I guess if I were a drug dealer--maybe my safest bet these days is to use cryptocurrency due to the anonymity. A bank could suspect how much drugs I may have been dealing with hypothetically. Hiding my hypothetical money from hypothetical drug proceeds isn't easy. I believe that if I were a criminal--my "best bet" is cryptocurrency.

Right now, I evaluate some of my mistakes. Hopefully, I don't fall into cryptocurrency. Good thing I avoided Axie Infinity because it's too good to be true. One of the reasons why I fell for scams before are falling for promises too good to be true. If it's too good to be true then it must be another scam.

References

Websites

"Charlie Munger says buying crypto is investing in nothing - and he avoids it like a dirty sewer" by Theron Mohamed (July 12, 2022)

https://markets.businessinsider.com/news/currencies/charlie-munger-crypto-bitcoin-warren-buffett-berkshire-hathaway-inflation-stocks-2022-7

"Cryptoqueen: How this woman scammed the world, then vanished" (November 24, 2019)

https://www.bbc.com/news/stories-50435014

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