Bitcoin Might Be The Charo Of The Cryptocurrency World

By Emily Cutler | Last Week Tonight | March 12, 2018 |

By Emily Cutler | Last Week Tonight | March 12, 2018 |

Did y’all know that Charo can play the ever-loving shit out of the guitar? I ask this because later on, I’m going to get into a real weird analogy, and I want to make sure that we’re all starting with a least one important piece of information. Charo rocks the guitar. Also, all money is made up. That’s important too.

OK, so we’ve covered Bitcoin a little before. And I still insist that it should be viewed with some skepticism since bundles of crazy sunshine don’t seem to trust it. But here’s another new thing about Bitcoin: compared to its competition, it might be one of the few cryptocurrencies that’s actually worth anything. It has some potential and talent as a new method for storing information in ways that other cryptocurrencies do not i.e. it is the musically talented Charo to the vapid void that is Paris Hilton. They might both be “reality stars,” but that term means vastly different things.

So that’s the first half of my claim. Some cryptocurrencies are better than others in the same way that some reality stars are better than others. Also, both cryptocurrencies and reality stars will leave you penniless and heartbroken if you invest in them too greatly (I hear there is something called Vanderpump Rules about which people care. I would advise against this). But the second part of my claim? About how money is made up?

Yeah.

It’s a fun, although not un-terrifying thing to think about: Why does money have value? You’re willing to work (probably more than) forty hours a week for someone else because they promise at the end of two weeks they’ll tell their bank to lower the numbers in their account so your bank can raise the numbers in your account. And then you pay your bills and rent/mortgage by telling your bank to send numbers to other banks. And all of it works because we agree that it does. Sure, there’s the element that the government has laws to enforce employment agreements and contracts, but those were designed to solidify a system where people were usually paid with pieces of paper. Ones that we’ve decided have value.

And it’s not just that money itself is entirely made up. It’s that most of the goods and services we purchase are completely divorced from any inherent value. How much are you willing to pay for a dozen eggs? Why? Is eighty-five dollars a night for a four-star hotel a good deal? But would you even be willing to stay at a hotel costing eight-five a night if it didn’t have four stars? What changed that one is a “deal” and one is a “murder house?” Speaking of, why are you willing to pay two-hundred dollars a night (or significantly more) for the comforts of lodging when it’s a hotel room, but not when it’s the place you live? (Unless some of you are in fact spending six-thousand dollars a month on housing in which case I say congrats or I’m so, so sorry.) And of course, you can point out that most people can’t afford to spend two-hundred dollars a night on lodging all of the time, but they’re willing to do it once a year as a “treat.” Which only raises the question, why is paying more for something considered a luxury? (Also, sorry, economists, but apparently basing your entire field of study on the premise that “people are rational” might not have been the best idea.)

The basest answer to all of these questions is “Because we decided to.” Milk costs two-dollars a gallon because that’s about where consumers decided they’re going to stop paying more. They’ll pay more over time, but that’s just where we “feel” milk should cost. Unless you add something special like it comes from humanely-treated free range cows. Or it’s got extra Omegas. Or it’s a famous cow. So outside of the heinously illegal shit that some companies are doing, if you want to invest in cryptocurrencies, the only real question to ask is “Which brand to I like the most?” And honestly, you could do worse than using the same criteria you use on reality stars than you do on your retirement accounts.