Friday, November 25, 2022

Cryptocurrency Is Very Cryptic

Did you hear about the cryptocurrency exchange, FTX, that crashed and burned recently? News reports say FTX was a massive Ponzi scheme, and investors lost billions of dollars. I was planning to comment here on what exactly happened with FTX, but then I discovered the more I tried to understand what cryptocurrency is, the more confused I got. 

As far as I can figure, people invest real money into cryptocurrency, where it is then turned into virtual money. This means a person’s real money has become part of a complex, internet-based video game, and at that point the value of the money can either skyrocket or become worthless. It all depends on, um, apparently no one really knows.

The main thing I know about cryptocurrency is what Matt Damon told me a year ago in his now infamous TV commercials: “Fortune favors the brave.” I guess while Matt was trying to convince people that it’s courageous to invest in cryptocurrency, he forgot to mention that destitution favors the gullible. 
Wouldn’t it be ironic if it turns out Matt insisted on being paid in real dollars from the crypto company he was shilling for? If that’s how he was compensated for making the commercials, it shows he was a lot smarter than the many foolish people who took his advice. (Remember “Good Will Hunting”? See, I knew Matt was a genius.)

So, instead of examining exactly what happened to FTX (because criminal prosecutors and bankruptcy courts will be sifting through that train wreck for the next three decades), let’s talk about something equally as shocking: in this day and age, there are still people named Ponzi. No, I’m not kidding! Can you believe it?

Now, let me say up front that there is nothing wrong with the name Ponzi. I’m sure it’s a fine, traditional name dating back centuries. However, in our modern culture, the name is now synonymous with stealing money. Can you imagine being a youngster, and your parents insist on keeping the Ponzi family name? Starting in about second grade, and for the rest of your life, what do you think your nickname will be? Lefty? Chuckles? Booger Brain? Nope, your nickname for the rest of your life will be Scheme. As in, “Very nice to meet you, Senator. Let me introduce you to my colleague, Dr. David Ponzi, but you can call him ‘Scheme’.”
To avoid a lifetime of ridicule, it would be so much better to change your name to something less larcenous, such as Bernie Madoff. Oh wait, that one might not be so good. If it were me, I’d go with something simple and unassuming, like Camembert McDoodleyboop, Jr.

As we come down the homestretch of this column, I bet you’re wondering how I’m going to tie together the topics of  FTX, Matt Damon, Ponzi Schemes, and McDoodleyboop, and then stick the landing. Well, I’m wondering the same thing, too.

Actually, I’m not going to tie those topics together at all. One of the benefits of adult-onset ADD (caused by too much channel surfing and social media) is that I can change topics in mid-sentence. So, I’d like to conclude this essay by pointing out that our entire modern monetary system is virtual. I mean, when’s the last time you bought anything with real cash (unless you’re a drug dealer or user)? Nowadays, all of our payroll, banking, and credit card transactions are digital, nothing more than a bunch of flickering images on a computer screen. 
Maybe our financial system is just a larger version of FTX. Oh boy, I don’t want to think about that. To paraphrase Matt Damon, “Peace of mind favors the ignorant.”

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