It’s been quite a few weeks, news-wise, for Bitcoin, specifically, and the world of crypto-currency in general. For instance, the price of bitcoin recently roller-coastered. It was high as around $58,000 last weekend, plunged to $46,000 or so. And the last time I checked, was creeping back up again towards 50k. Hands, as a result, my friends, started to wring. New York University economist Nouriel Roubini told Yahoo! Finance that investors will eventually “get crushed.” U.S. Treasury Secretary Janet Yellen, at a New York Times conference, said that Bitcoin is “an extremely inefficient way of conducting transactions.” New York Attorney General Letitia James squeezed $18.5 million in fines out of a couple of cryptocurrency firms, Tether and Bitfinex. Meanwhile, Twitter chief Jack Dorsey’s side hustle, Square, poured another $170 million into Bitcoin.
What does it all mean? I couldn’t tell you, so I turned to Daniel Roberts for a few answers, as well as a cryptocurrency primer. Dan, a former reporter for Fortune and Yahoo! Finance, is editor-in-chief of the cryptocurrency website Decrypt. Edited excerpts of our conversation:
Q: Dan, first off tell me a little about Decrypt. Are you there for the retail investor? The corporate treasurer? Elon Musk?
A: Decrypt was launched in 2018 amid what was called the “crypto winter.” That was the big price pullback after the late 2017 surge. We are here for everyone interested in cryptocurrency and blockchain, at all levels or understanding. We are a daily news outlet for the people who already live and breathe this stuff—and a welcoming resource for people whose understanding level is zero and want to start learning. (For more of what Decrypt calls its “learn content,” click here.)
Why the big interest now? In the past week alone Janet Yellen weighed in, Jack Dorsey announced a big investment, Roubini, per your former employers, predicted Armageddon for inexperienced investors.
It’s not unrelated to the retail investor revolution that began earlier in the pandemic and then accelerated with the Reddit-fueled GameStop frenzy. Young people with money to invest for the first time—and serious Wall Street fund managers—are flocking to crypto as an investment. Meanwhile, big names like Jack Dorsey at Square, Michael Saylor at MicroStrategy, Dan Schulman at PayPal, and Mark Cuban are also publicly endorsing crypto. But it’s also not just about investing, it’s about the myriad business applications of this technology. For me, if crypto was once seen by some as “niche,” it isn’t anymore—crypto is a part of mainstream finance.
Dan, as you know, I’m old enough to be your grandfather. If I was indeed your grandfather, how would you explain cryptocurrency to me and how it works?
I like to simply say that these are digital assets, as opposed to currencies per se. You can’t touch and hold bitcoins, but when you log into your online banking, you see your balance and trust that…