Let’s talk about the bottom layer of doge, shib, and babydoge. In the bubble era, there is only risk if there is no risk

In the past two days, I have been writing about babydoge. Moreover, when prices skyrocketed a few days ago, the baby dog, Shiba Inu, and meme currency sectors saw relatively large increases. So another netizen came out to speak. He said these things are all lies, just like cutting leeks. Risks are high in this era, so everyone should hold cash and wait and see. Sooner or later these copycats will return to zero.

That makes sense. But it still can’t explain why altcoins are rising and falling in waves. Many projects that everyone looks down upon and think are scams and projects that don’t make sense logically can rise just because more people know about them. And it’s not a one-wave rise, it’s a repeated rise. What is going on. Let’s talk about my understanding of this issue.

First, is it a copycat?

First of all, I want to make it clear that in my opinion, almost all Moyin coins are copycats. What are the standards for copycats? I personally think the main ones are the following.

The second is that there are more slogans than practice. Everyone, please read the white paper of Bitcoin and Ethereum, which contains examples of solving many practical problems. As for Bitcoin, I will tell you how its utxo account solves the double-spend problem. He will also calculate detailed probabilities and tell you how to prevent blockchain evil and how to ensure security. And if you look at the memecoin white paper, it basically shouts slogans and paints a beautiful vision for everyone.

Third, short-term interests are higher than long-term interests. The birth of Ethereum actually wanted to construct a large decentralized platform where smart contracts can perform a variety of functions. He didn’t even think that I was building this chain for the future of decentralized finance. In fact, decentralized finance is something that people have gradually developed on Ethereum.

But this is not the case with meme coins and animal coins at all. They just use smart contracts to play finance from the beginning, telling you how much profit you will make in how long and how much money you have in your tokens. How many locks will there be? Their contributions are often short-term.

Second, speculation is rampant and people have changed

In fact, some people should be able to observe that in recent years, not only altcoins and blockchain, people have speculated on many things. .

The most famous thing is the house. The house has been speculated to a very high level. If you look at the housing rental-to-sales ratio, the housing price-to-income ratio is outrageous. What is going on?

There are also some art markets and antique markets. The price increases for these things are actually quite dramatic.

There are also American stocks. Some of the small-cap stocks in our stocks have also risen very sharply. In other words, everyone is speculating.

In the past, our ancestors told us that only by being diligent and frugal can we get rich, and never go into debt. Debt is a waste of money, but these days, these principles seem to be less applicable. Those who are diligent and frugal can only eat with one mouthful, but those who dare to take risks and invest in debt eventually become successful people.

What exactly is going on? Could it be that human nature has changed and people like gambling?

Third, why are there so many copycats? The earth is no longer flat

In this way, altcoins do not have that much value and do not have such a large application space, but another strange phenomenon is that altcoins emerge in endlessly, and like older altcoins, For example, Shiba Inu and Big Dog have actually gone through many rounds of bulls and bears, and their prices have risen sharply. It's not like you die in one round of travel. Why does this happen?

I think we should look at this issue from a broader perspective. We may be living in such a bubble era, and it may not make sense, because there is too much money and nowhere to go. Always stir-fry and play. Bubbles come and go.

Before 1971, what was money in the world? We are in an era called the gold standard or the gold exchange standard. What's the meaning? That is to say, if you deposit money in the bank, the bank will stipulate how much gold can be exchanged for one dollar. As long as you hold these pieces of paper, you can exchange it for real gold and silver.

This is very troublesome. Because your money corresponds to gold, and the mining speed and reserves of gold are certain. Maybe the difference in the value of gold ten years ago and ten years from now is not that big.

In that era, it was the uncle who borrowed money and the grandson who owed money. No one was willing to borrow money because they had to pay back real money. In other words, you can imagine that we are doing business on land. In a word, no one is willing to borrow more money. Everyone’s money is precious and they are not willing to spend it casually. Diligence, frugality and no speculation were the main themes of that era.

But after 1971, this problem was completely solved. The Americans are so shameless that they can no longer exchange their money for gold. We’ll talk about the mechanism later when we have free time. In short, it can’t be exchanged because there is little gold and too much money, so there is nothing we can do.

At this time, the entire logic of the world has changed. What is money? Money is a person's face. If you are thick-skinned, you will have more money, such as Americans.

The Americans said that although you can't exchange for gold, you can come to me to exchange for my industrial products, or you can go to Saudi Arabia to buy oil. You can go to Japan to buy his electronic products. Then we took the money to buy it and found that we could really afford it. People all over the world went to buy it and found that they could also buy it.

Everyone gradually develops a habit. You use it, and I use it too. Just like WeChat, we have many opponents and everyone else is using it, forcing you to use it.

But note that in the final analysis, Americans print their money with their faces and use their national debt as guarantee, but how does the number of national debt come from? To put it bluntly, I don’t know, he can print as many copies as he wants. In other words, there are no such hard constraints. At this time, we are facing a situation of currency flooding. We used to do business on land, but now we are doing business on water, and there is more and more water.

How fast is this speed? The average annual growth rate is 9%. The base currency of the United States will grow by 9% every year. Note that this is only the base currency. If you have a little macro common sense and add the money multiplier, you don't know what it is.

You will see a wonderful phenomenon. If you borrowed 100,000 yuan 20 years ago, it would scare you to death. You don’t know when you will be able to pay it back in your life. However, 20 years later If you borrow another 100,000 yuan, the pressure may not be so great. And there seems to be no chance of this trend slowing down.

Many people believe that hard work and frugality can make you rich, but times have changed. When your money is depreciating all the time, people's gambling or investment speculation needs will be brought out. Many people may no longer hold cash, but invest it in some high-risk, high-yield assets. I think this is the blockchain and the underlying reason for the existence of altcoins and their ups and downs.

One sentence. In an era of rapid currency devaluation, holding cash may be riskier in the long run. Not taking risks is the biggest risk. It’s just that there is knowledge in it, and there is also a strategy in taking on debt. Short-term speculation and leverage are actions that seek death.

The above is all nonsense from me and does not represent any advice.