By Miles Clyne
There is irony in these two “products” in that not so long ago they were both seen as something that was not acceptable in the mainstream, and were products for the less conventional among us. Our Prime Minister gave credence and a higher level of acceptability of Cannabis in his election platform a couple of years ago, and is following through on its legalization. Bitcoin and more than 1000 other crypto currency are now flooding the market with millions of people buying into the mania.
Cannabis has been around for a very long time, and has been widely used for both medical and recreational use. Crypto currency for about 7 years, with Bitcoin being the original. Crypto currencies are still in their infancy, whereas cannabis is coming of age, like it or not.
If you are disturbed about the imminent legalization of cannabis, imagine how the global financial markets feel about the money rolling into crypto currency and out of their hands? I have no idea how this was actually determined, but an estimate I heard is about 500 billion dollars is now spread among the available currencies.
Here’s another irony. One has been mostly an illegal substance, the other a buyer beware product. Kind of funny because with one you lose your mind for a little while, whereas the other you could lose your money forever, or recently, make a lot of money. Both risky depending on how you look at it. And clearly both are a drug that people can’t get enough of.
The differences between the two products are as equally obvious as they are entertaining. I say entertaining because just watching what is going on is like a great drama unfolding. I’m drawn into and participate in the financial side of cannabis, because there is an ever-growing market of consumers on the medical side, and I’ve been told (wink wink) there is a well-established recreational market. A good long-term investment opportunity should always be considered.
This partial definition of crypto currencies helps define why the masses love the concept, and I’m a part of the masses; "decentralized cryptocurrencies such as bitcoin now provide an outlet for personal wealth that is beyond restriction and confiscation". Who in their right mind wouldn’t want this level of control on at least some of their financial assets.
The challenge I’m having is that crypto currencies, unlike cannabis, are created by humans from writing code, so essentially something out of nothing. Granted you need the resources to create it, money and or skill. But currently, raising money to create more crypto currencies isn’t an issue based on the rampant demand. But I know what I’d get if I bought cannabis. A real product, medicinal or otherwise.
A crypto currency is a notional value referenced as a coin. Notional meaning it exists in a theory or an idea. It can be argued this is true of any currency, but fiat currencies like the Canadian or US dollar are backed by the assets of their governments. This is a massive distinguishing factor that crypto currencies do not have.
Regardless of the ideologically and altruistic reasoning for the initial creation of bitcoin, the world fills voids. Assuming all crypto currencies are created equal would be naive at best, very dangerous at worst. It is human nature to want to go where the money is. Most of us are old enough to remember the dot com era and what happened. There are still lots of dot com companies around, but for a period in time, more were disappearing than appearing, just like investor money.
Given the imminent legalization of cannabis and immense investment into crypto currencies, their true test is yet to come. If you are trying to convince yourself of the validity of anything, you look for proof. To date there is limited proof of what will happen to many of the cannabis companies and crypto currencies. There should be no confusion between rampant speculation and proof. Proof in these cases will only be revealed over time.
So why are Cannabis and Bitcoin a Christmas Tale? Quite simply, many are getting their wishes fulfilled this year. And some of those wishes are truly magical and beyond comprehension. Many have dreamed of pot becoming legal for recreational use for what I’m sure seems an eternity. And crypto currencies? Be it Santa, or some other celestial being that created this opportunity for the masses as never before seen, surely has to be a miracle?
This Christmas Tale is not finished, but let’s leave it here for now. Enjoy the happiness and the wealth that comes to us when we try and do our best for all concerned and ourselves.
Merry Christmas, best of the season and a happy New Year.