Is Cryptocurrency Another Kind of Internet-Based Religious Gambling?

I was taking a bath and scrolling through Twitter one day when this tweet flashed before my eyes: “There’s never a dull day in crypto.”

While this may seem like a completely unremarkable text to most people – it hit me hard.

Maybe it was the exhaustion from the long run and the slight dizziness from the bath, but I just couldn’t shake the feeling that “Damn, this is a weird fact.”

Whether you own cryptocurrencies or not, it’s true that there has never been a dull day in the crypto markets since prices began to surge in late 2020 and digital assets went mainstream.

Crypto is no longer just decentralization and “blockchain” that computer professionals talk about at conferences and everyone kicks themselves for not paying attention sooner — it’s a mature, multi-trillion-dollar industry with mainstream media coverage and millions of people arguing about it on Twitter.

While fans are calling cryptocurrency “the future of finance,” critics are denouncing it as a giant Ponzi scheme. But in short, I think they’re both wrong.

To me, cryptocurrencies seem more like an internet-based religion mixed with technological gambling ("trading"), wrapped in a weird cyberpunk value economy that is ultimately used by speculators to make a killing.

We are told over and over again that cryptocurrencies, blockchains, and decentralization are the magic solutions to every economic problem imaginable. But the real question is:

What has cryptocurrency actually “revolutionized” so far?

We have seen crypto go from a single asset in 2008 to the thousands of crypto “coins” and other assets we see today. Some crazy people in Silicon Valley have rebranded themselves from tech bros to crypto bros, and I really don’t know which is worse.

Now, Robert Breedlove (founder and CEO of Parallax Digital) — like Deepak Chopra (pioneer of mind-body therapy) in the Bitcoin space — likes to ramble on about how Bitcoin expands people’s “time preference” and promotes some anti-intellectual aphorisms.

I truly believe that most regular people with crypto wallets aren’t buying crypto to usher in a glorious, decentralized monetary utopia… they’re doing it because it’s fun and because they’re enticed by a grand marketing campaign that bears an uncanny resemblance to mid-19th century Christian evangelism.

Let’s start with religion

What makes the crypto movement so powerful is the pseudo-religious narrative behind it. It all started with Bitcoin evangelists (extremists) who promoted their holy “decentralized asset” in the hopes that if enough people adopted it, it would one day become the world’s reserve currency.

Honestly, the puppets who preach the benefits of Bitcoin and cryptocurrencies share the same ideological output and “brainwashing” structures as American evangelical Christians at the turn of the 20th century.

The difference is, instead of ushering followers into the light and forgiveness of the Kingdom of God, they’re asking people to transfer their fiat dollars to a fictional code-based currency on the internet because Bitcoin “High Priest” Max Keiser said it was a good idea…

What is religion without missionaries?

Cryptocurrency evangelists

Bitcoin and crypto “influencers” have become extremely popular on both Twitter and YouTube. This group of figures seems to have unwittingly adopted a strange form of financial evangelism, promising the same things that religious zealots of the past promised—eternal salvation from the failures of everyday life if you agree to follow in their footsteps.

Regardless of my opinion, they do play an extremely important role in the cryptocurrency world - they are purveyors of confirmation bias. Go through the tweets of Michael Saylor (another well-known Bitcoin maximalist), and it is easy for ordinary people without financial education to be inspired by his marketing copy.

It’s this type of pseudo-intellectual preaching that brings people into the cryptocurrency space, and it’s this type of pseudo-intellectual preaching that keeps them “HODLing” even though Bitcoin and cryptocurrencies more broadly still offer very little real, meaningful value.

People are often struck by these seemingly mythical statements which continually obscure the fact that very little real-world utility has been created in the world of cryptocurrency.

Entertainment is key

Now that we’ve seen how the quasi-religious structure at the heart of cryptocurrency can bring people in and assuage their doubts — the next most important ingredient in the crypto cocktail is: entertainment.

While most commentators are happy to label crypto as a subcategory of finance, I’m beginning to think it might be more appropriately placed within the entertainment industry.

Unlike the traditional financial world where investors pore over balance sheets and quarterly reports, there is little for cryptocurrency enthusiasts to look at, and price action can represent the full extent of technical analysis, which without a certain level of experience is basically just an extra step to astrology.

Unlike the boring world of traditional finance (TradFi), with its trading schedules, earnings calls, and balance sheets that require time and effort to understand – cryptocurrencies are fast-moving, highly unpredictable, and trade 24/7.

In many ways, investing in cryptocurrencies is very similar to gambling. Most retail investors who hold cryptocurrencies do not do so because they understand cryptography, blockchains, hash codes, or computers, they do so to gain some exposure in a market known for 5x+ overnight gains.

The “rabbit-hole” that crypto enthusiasts talk so happily about is more about pure entertainment than developing proper financial education. There’s nothing wrong with entertainment, but it’s not what should be sold by crypto influencers and unemployed 23-year-olds on Twitter with NFT pictures.

Put it this way – instead of having to walk into a smoke-filled slot room at their local pub (with stale beer and dead dreams strewn across the floor), millions of people may now be walking around with a little slot machine in their pocket.

For those who scoff at the idea, virtually every crypto trading app is gamified to varying degrees. Binance, the world’s largest cryptocurrency exchange, offers a constant stream of lotteries, exclusive offers, and mystery rewards. Yet hardly any traditional financial company offers fun little rewards and “mystery boxes” for users who complete a moderate amount of trades per week…

All the while, those who have been dragged into the addictive, gambling-like world of crypto have been gradually brainwashed by flashy signals and big-budget advertising gimmicks, and their doubts have been dispelled bit by bit. After all, crypto is the "future of finance."

How did encryption get here?

The entire cryptocurrency market is currently valued at $1.85 trillion, and the world’s leading financial institutions are pouring more money into cryptocurrencies every day.

This should be evidence against my crypto-skepticism, right? You say, don’t the world’s largest financial institutions know what they’re doing?

Well, not really. From what I can tell, almost all of the large institutional participation comes from FOMO (Fear of Missing Out) rather than actual investment strategy.

Matt Comyn, CEO of Australia’s largest financial institution, Commonwealth Bank, said it best:

“We see the risks of participating, but we think the risks of not participating are greater.”

Currently, cryptocurrency adoption seems to be a self-fulfilling prophecy. Rising inflation and global conflicts have fueled the influx of money into the crypto space. Onlookers continue to watch the rise in the value of crypto assets and decide to participate themselves, which pushes up the value of crypto assets or at least keeps the value stable.

But what everyone seems to be missing is that most of the cryptocurrency projects are hollow.

While market-leading, platform-based crypto projects like Ethereum have largely made sense with their own cypherpunk economics, the majority of the rest of the crypto world is often little more than a convoluted Rube Goldberg machine that continually promises a grand purpose but fails to deliver on real-world use cases.

Unless crypto assets solve a measurable real-world problem, it may just be another form of self-serving preachers peddling slogans in this strange, growing digital religion.