Whether the mainstream media liked it or not, Cryptocurrencies has become a thing. With tens of millions of users actively investing, trading and using various digital currencies, the question about adoption and technology viability has come to rest.
The media companies who loved reporting about how awesome Dow, S&P 500 was doing, tried to kill off the bitcoin and altcoin phenomenon as a bubble. They did it hundreds of times, but the investors proved it wrong with the market cap being currently at around $700 billion(I know it’s not a great metric about progress, but until we find a better one, market cap actually shows progress and adoption). Naturally, after the prices increased exponentially, millions across the world have joined the bandwagon, they wanted in. They started aggressively reporting every small thing about cryptocurrencies. Big media houses like NYT, Fortune, Bloomberg & gossip sites like The Sun also started reporting cryptocurrency. And yes, the sun, the entertainment newspaper has tutorials on how to buy various crypto tokens.
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Pump & Dump - Litecoin & Ripple Example
While it’s great that cryptocurrencies have become mainstream, the industry has become all about the price and earnings. The media aggressively covers rise or fall in prices almost real-time now. After Bitcoin & Ethereum has become very mature in terms of withholding prices and gaining back any lost value, CNBC and other major media companies went after the altcoins, Litecoin founder Charlie Lee has appeared on CNBC and told them how awesome Litecoin is. This apparently created a very positive market sentiment about Litecoin and a FOMO among investors, the price skyrocketed. It grew by over 200% with Litecoin all time high’s hitting at $360 on GDAX. Once the honeymoon was over, the price of the Litecoin kept dropping and thousands of users who joined the market during all time high’s has a sour experience.
They did the same with Ripple, about how it’s going to change the payments for good and banks will replace FIAT with XRP tokens. CNBC, in fact, did a tutorial on how to buy XRP tokens on Poloniex whose website asks SSN in plain text. Like why do you have to create a phenomenon and when the price drops, create FUD around it.
I’m not saying they benefit from this or the technology was bad. But they don’t understand that it doesn’t help in educating the investors. Creating FUD the moment there’s a regulatory challenge like China or South Korea banning cryptocurrencies doesn’t help the market. Like if it all goes down, I wonder if they come out and say, We told you so.
I believe a neutral way of reporting facts and educating users in technology rather than creating FOMO or FUD would help us take the best parts of technology forward and use these in the real world. What do you guys think? Tweet me at @vthallam or comment here.