And I mean LITERALLY explain like I’m 5, I literally know nothing of the technical terms and such
In: Economics
1: be a sucker who buys coins from someone else
2: find a sucker who is willing to buy at a higher price than you paid
There isn’t really any wealth generated from crypto, it’s just money moving from person to person and the greatest fool loses (the person who buys at peak).
Compare to something like stocks, where there’s a company which either currently pays out a dividend (a portion of their profits) or maybe one day will start paying out dividends. Facebook for example for a long time was a growth stock and recently started paying a dividend. The value of the stock is generally intended to be a reflection of the value of the company and you can measure the current value against their revenue.
With crypto there’s literally nothing but people’s feelings about it’s value. It doesn’t pay interest, it doesn’t pay dividends, there’s no revenue related to it (mining takes money *out* of crypto.
The quick ELI5 is that you can only make money if someone else is losing money.
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