The ultimate con --- selling virtual bridges made of electrons to rubes who had been convinced that their powers of observation were superior to all those others who just didn't "get it".
It's pretty much enough to look into the time of birth of the Bitcoin and you can see what was the first purpose ot cryptocurrencies. If some morons lose money on get rich fast schemes, it's on them.
The key word is "symptom" --- not to be confused with "cure".
The ... banks?
... irresponsibly?
Where does this distrust come from? Central Banks have been running QE for ages (the Fed since the GFC 2008, BoJ even earlier), and inflation has been fine for decades (too low, rather).
Now, in exceptional circumstances (pandemic and war and supply chain problems due to those and fiscal easing) there's a short spike of inflation that's brought inflation averaged over a decade just a tad over the 2% goal. Where's the "irresponsibility"?
The only thing restraining the creation of crypto is the fact that it is virtually unusable as an actual currency. If it were otherwise, every celebrity, politician and corporation would just mint their own continuous stream of the stuff. There is nothing to stop them.
Productive work would become obsolete. Why work to "earn" money when you can just mint it? A lot of life's major problems could be solved instantly by crypto. If you buy this, I've got some crypto to sell you.
You’re failing to realize that value is socially derived.
You're failing to realize that lots of people/companies have a larger social presence than Satoshi Nakamoto and are thus in a much stronger position to derive value from their own crypto.
But most of these have had the good sense thus far to avoid crypto scams due to the potential legal issues. Kim Kardashian being one example of a prominent exception.
https://decrypt.co/106533/kim-kardashian-ethereum-max-dismis...
However, the fact it isn't regulated doesn't mean they can't be sued in civil court for running a scam. This is what they are really afraid of --- see Kim Kardashian for an example.
This is why crypto bros tend to hide their identify (Satoshi) or re-locate outside the USA and go into hiding once the scam collapses (the guys from 3AC).
BOTTOM LINE: Selling electrons as money from your momma's basement is a shady business in more ways than one. Participate at your own risk.
Fidelis in Numeris
It's "fractional reserve banking" --- only worse --- minus any accountability or guarantee of solvency.
Crypto solves all the problems of the Federal Reserve and banking --- simply by mimicing it for fun and profit. If you buy that, I've got some crypto to sell you.
Crypto is backed by nothing. Nothing.
America, it’s workers, corporations, military, etc., will happily abandon the dollar should it become necessary. No one wants to be paid in money undergoing massive devaluation.
And to that point, it is true that nothing backs the dollar, but nothing backs nothing if you go down that road.
In past times, when, let's say a city was being attacked and there's a seige, and food runs out, people will sell their $500,000 diamond ring for a potato, so diamonds and gold have no value as compared to a potato.
However, if a meteor like the one that hit the earth 65 million years ago and wiped out the dinosaurs, hits again and wipes all of humanity out, there is no "back" of any currency anywhere.
I mean, if you're going to go down that road, let's take it to it's conclusion.
However, in the everyday world, the US dollar has a lot behind it. Like a huge military. No country is going to come in and take over the USA and throw out our money. Because we have a big military. There's a lot of trade going on with greenbacks. It is the world currency.
I'm not saying it is impossible for the dollar to go down the tubes, please don't assume I'm that stupid, nor anyone else is.
But there's a hell of a lot more reasons to stick with US dollars as a store of value, rather than bitcoin. Bit coin has got nothing, just a bunch of narcoterrorists and billionaires trying to smuggle out ill-gotten gains so they don't have to pay taxes. And the speculators working from the greater fool theory.
Fiat currencies are not “backed”, you have nothing they are even theoretically guaranteed to be exchangeable for, at a fixed rate of currency to commodity, setting a value floor, at least relative to the commodity.
They are, instead, actively managed.
The theory is that this is better, at least for large, geopolitically and economically powerful, countries as issuers, because backing commodities themselves are only at best a limited fit for the (even as a value basis) desirable features of currency, and have somewhat random performance at any given time compared to that “at best”, and active management (which is also not perfect!) seems to be able to do better, if the manager governs a big and powerful enough market to start with.
I'm just talking about regular everyday stuff. The US dollar has been exceedingly strong for a long time, due to many factors, none of which is that it is "backed" by gold or baby diapers or star trek transporters machines or orange juice.
This is just a colloquial conversation. If you want to be exacting, I can write 200 pages on it, complete with sources. But are you going to want to read it? or would I be wasting my time writing a long and thorough explanation? Wouldn't a couple of paragraphs suffice and just not have people nitpick in order to score "gotcha" points?