https://finance.yahoo.com/news/crypto-universe-may-round-pain-022846955.html
The most optimistic crypto proponent has thrown in the towel and given up on its unrealistic target for bitcoin.
Bitcoin prices won't recover to its glorious peak as more people get educated about crypto. Please read our post below for more information.
https://sg-stock.blogspot.com/2018/11/a-financial-analysis-on-initial-coin.html
The crypto developers have been trying to rectify the security and structural flaws by switching from a POW (proof of work) to POS (proof of stake) system because POW consumes too much energy resulting in energy profligacy. However, the developers are missing out the fundamental issues of money.
Money is a derivative of the economy and its supply cannot be limited or else it will be abandoned like the gold standard because of its finite supply. Why is this so?
Money supply has to be able to shrink or expand to manage the economic growth because of inflation and deflation. Under normal circumstances, there is an incremental natural rate of growth in the economy because of new services and products being created which will increase the economic size. Consequently, the money supply has to be increased for the economy to function properly. Likewise, the money supply has to be reduced when the economy is having a recession.
If a digital monetary structure has a limited supply, it won't be able to function like what the fiat money can do. Therefore, the cryptocurrency will never become a legitimate and real currency.
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What will happen when the money supply is limited?
This will have serious consequences for the economy. As the economy is growing naturally, the money will get increasingly expensive because of its limited supply and this will eventually cause its exports to slow down or stop and push the economy into a recession. When the economy enters a recession, the money supply still remains the same and this will cause serious deflation because people will delay their purchases as local prices and wealth keep falling.
Therefore, the money supply cannot be limited or else the economy will get into serious troubles.
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