June 23, 2024

Betting on Crypto Won’t Save You



Zo is a staff writer at Okayplayer where he covers…

matt damon

Photo Credit: Crypto.com

Weeks into the trenches of another colossal crypto market crash, the glimmer and promise of a new digital asset class has all but dissolved.

Whether you’ve been in it for a minute or cautiously observing from the sidelines, crypto has likely crept into at least some part of your feed over the last two years. Shorthand for the thousands of digital denominations or “cryptocurrencies” that have emerged to support the development of companies pushing to bring practical purpose and utility to blockchain technology, crypto went from one of the hottest Google search terms for bag-chasing amateur (at best) investors to a source of perpetual pain and anxiety for almost anyone who got swept up by a powerful publicity machine fueled by high-profile celebrity partnerships and more memes than any brain can safely process.

If you bought into what are considered even the safest coins, namely Bitcoin and Ethereum, at the height of the hype in late 2021, you’re currently down no less than half your initial investment. If you took positions on less established “community coins” like Dogecoin and Shiba Inu or “altcoins” like virtually everything else available on exchanges, chances are, you’ve lost a whole lot more than that. The only people who seem to have any faith left in crypto and blockchain adaptation as a whole are the evangelists, who tend to be developers, venture capitalists, or veterans of the market who have had their brains rattled by the volatility once or twice before.

Though this market cycle appears to have ended with the same dazzling nose-dive as any in crypto’s relatively short history, the latest and most visible run to date was bolstered by newfound mainstream resonance and the rise of some very catchy, albeit nebulous, buzzwords. From fitness to finance, real estate to augmented reality, companies in seemingly every sector of the global economy have caught the Web3 bug, incorporating crypto projects into their varying business models and services. Some have done so with a fair amount of success. Major label and independent musicians alike have found a new revenue stream in selling NFTs, a digital collectibles market that has recently cooled off, but brought in more than $86 million in 2021, according to a study from crypto collective, Water & Music. Social media companies and the tech world at large are racing to launch and scale their metaverse projects, a market Citi estimates will grow to $13 trillion and more than 5 billion users within a decade. 

These are great health markers for institutions and all-pro investors who can endure, and even influence, the hallmark ricocheting of crypto markets. But those with the least to spend have the most to lose. And they comprise the overwhelming majority of who was left holding the bag in the wake of the latest crash, which was sparked by the $50 billion death spiral of the UST stablecoin and its governing sister token LUNA. Explaining the mechanics of the UST crash and why it took so much of the market with it requires a level of technical literacy, historical context, and analytic chops few possess. And that’s precisely why the risk to curious newcomers is so high.

While established traders have a range of algorithmic tools and metrics to inform their investments, novice market participants learn to swim amongst the sharks with second and thirdhand materials. In the absence of access to vetted experts in the field, of which there are wildly few, new crypto investors turn to social media influencers peddling ponzis and pump-and-dump schemes. Or, far worse, celebrities. Tesla CEO and shit-posting prospective Twitter chief, Elon Musk, has been a particularly loud voice in the crypto space since announcing the company had acquired $1.5 billion worth in Bitcoin in February of last year. At the time of purchase, Bitcoin was worth somewhere between $38,000 and $42,000, which means even as a relatively early adopter of the token, Musk and his EV empire still took a 25-percent hit on their investment.

Musk may be in a tax bracket unto himself, but he isn’t alone in his advocacy of cryptocurrencies amongst the famous and deranged. Snoop Dogg has been touting his blockchain exploits for over a year now, launching his own series of NFTs and even a proprietary cryptocurrency. Nas was an early investor in the heavyweight crypto exchange, Coinbase, and has sold pieces of the publishing to recent tracks via Royal, a crypto-anchored music start-up launched last year. And the celebrity crypto-caping doesn’t end there. Matt Damon, Megan Thee Stallion, Wu-Tang Clan, Ja Rule, Azealia Banks, Gorillaz, and even the late MF DOOM either got in on the NFT racket or partnered with a crypto company to shill tokens and upcoming projects. They may all very well believe in the blockchain revolution and the decentralized user-owned digital utopia it promises to bring in the years ahead. Advocating in principle or practice for mostly untested products isn’t unique to this or any prior generation of celebrity. But getting fans and followers to buy in to a purely speculative digital currency market is an entirely new level of wreckless and dangerously irresponsible use of their respective platforms.


If you’re someone who did take the bait during the crypto gold rush of 2020-2021, you’re probably wondering where all of this is headed. Especially if you’ve finally come to terms with playing the long game to recuperate your losses. The short of it is that, much like broader financial trends, things will likely get far worse before they begin to rebound. And crypto isn’t the only economic vessel struggling to stay afloat. After watching home prices soar during the pandemic, economists and analysts are now bracing for the implosion of the US housing market, which has outpaced wage growth by more than 15% over the last two years. Russia’s invasion of Ukraine is wreaking havoc on oil, natural gas, and food prices, compounding the damage done to global supply chains by the pandemic. And the rate of inflation will likely remain steady throughout this year.

The silver linings are few and far between, but they do exist. Though stock and crypto markets have historically been uncorrelated, they are beginning to show signs of convergence, which means long-term stability for both could come in the form of regulatory efforts by the government. It also seems important to note that institutional adoption of cryptocurrencies is at an all-time high and will likely continue to ramp up as the market remains in buyer-friendly trenches. So for better or worse, crypto is here to stay. But the same can’t necessarily be said about the everyman retail investors who shouldered the brunt of the trillion-dollar sell-off that tanked prices across the board over the last six months.

Recovery will be a stressful waiting game. It doesn’t have to be an expensive one, though. However long it takes to bounce back from this, the time itself will be invaluable. It’ll afford you the opportunity to firmly familiarize yourself with the fundamentals and goals of the projects you’ve put money into. It’ll allow you to recalibrate (or, you know, actually develop,) strategies for the next run, should you choose to stay in the game. And hopefully by then, whether six months or six years out, you’ll have shaken off enough of the FOMO and degenerate gambling tendencies to realize betting crypto could be lucrative down the line, but it sure as hell won’t save you.


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