My view on cryptocurrencies

A currency is a unit of exchange that facilitates the trade of goods and services. For something to be considered a currency, it must have 5 properties:

• 1/ Scarcity: unit supply must be limited
• 2/ Fungibility: units must be identical and interchangeable
• 3/ Divisibility: units can be broken into smaller fractions to enable transactions
• 4/ Durability: units must withstand use and transfer over time
• 5/ Acceptance: unit's value must be recognized and accepted by a community

Until recently, currencies have respected these properties thanks to a superior system that guaranteed them. States stand above citizens, set the rules of social life, and ensure their currency is: scarce (they create it through the mint and control its supply), technically sound in terms of fungibility, divisibility and durability, and accepted by citizens and institutions within their territory.

This changed with the invention of cryptocurrencies. A cryptocurrency is a digital unit created by the same users who guarantee its security. It is self-sustaining: it rewards you with cryptocurrency in exchange for verifying that other users are not falsifying transactions or creating counterfeit coins. This system called blockchain has made it possible, for the first time in history, to remove currencies from the control of any central authority. The system relies entirely on its users.

Cryptocurrencies have all the properties of a traditional currency, with one addition: privacy. Having no central controlling authority means zero oversight of transactions and complete anonymity for users.

Up to now we have shown that cryptocurrencies are just as good as any other traditional currency (they respect the 5 fundamental properties), with one additional advantage: privacy. However this new type of monet has two significant problems. First, states and other central authorities that manage traditional currencies have no interest in letting crypto become the standard. It would mean giving up control and oversight over their citizens. These authorities are not powerless: they have executive force (armies, police, prisons) and significant influence over key industries (e.g., banks). This creates one of the main flaws of cryptocurrencies: you can barely use them to buy anything. Second, because there is no central authority providing security, many financial instruments are simply impossible to offer in crypto. The clearest example is loans. A bank lends you money because it has your identity and knows that, if you default, the state's legal and executive apparatus will intervene to protect the bank. That guarantee does not exist with crypto. Total privacy limits trust, that lack of trust, in turn, limits what the system can do.

These two main flaws make crypto extremely impractical for common people and everyday uses. So who are the people who, despite crypto's evident impracticality, would still buy it? There are three groups.

• 1/ Criminals. People who go against the law. Cryptocurrencies offer the anonymity of cash but in far more practical digital form (no need for a bank or a physical hiding place, instant digital transfers that leave no trace). Drug dealers, human traffickers, and others in equally terrible businesses use it for exactly these reasons. In this group I also include some honest citizens oppressed by dictatorships, who need to keep their money out of their government's reach and move it freely across borders. Of the three groups, this is the only one that uses crypto out of genuine necessity.
• 2/ Dreamers. People who save in crypto — not invest, save. They believe crypto will be the money of the future and are saving in it accordingly, treating it like gold. The problem is they haven't accounted for states, which have no intention of replacing their own currencies. These people often imagine utopian worlds without borders or governments, running on decentralized digital money. I leave it to you to assess the likelihood of that scenario.
• 3/ Speculators. They buy crypto expecting the price to rise and to sell for a profit. They often invest without a rational basis, following trends and hype. The truth is that the only things that can rationally drive the value of these currencies upward are an increase in illicit transactions or a growth in the number of people living under oppressive regimes. Everything else is just noise.

My conclusion is simple: don't buy crypto unless you belong to one of these three groups. 1/ If you are part of the first one, I'd suggest reconsidering your life choices if you still can. 2/ If you are part of the second one, try to honestly assess how realistic your vision is and talk to people who will push back on it. 3/ If are part of the third one, keep speculating only if you have genuinely solid information about macroeconomic trends in the criminal world and in countries under authoritarian rule.

08/09/2026