Can Easy Cryptocurrency Gains Replace Skills?

A lot of people who thought they had a ticket to financial security just lost a lot of money. The collapse of the FTX trading platform is the latest failure of a cryptocurrency exchange.

Like TerraLuna and Tether before it, FTX drew in people with big results and promises. However, results and promises can vaporize if you don’t know what you’re getting into.

Instead of investing in themselves, users of the exchange bought into a promise that FTX’s value would keep going up and up. What they didn’t realize while watching their fellow traders getting rich was how quickly the rug could be pulled.

Murky Water

Many cryptocurrencies promise investors can retake control over their actions while still buying goods and services the way they’re used to. Compared to the benefit-privilege of fiat currency issued by a government, this is a strong selling point.

But do investors really understand cryptocurrency transactions? Or are they just throwing money at an asset class they think will go up forever?

Something that hasn’t changed is the pump-and-dump scheme. Essentially, a business owner will talk on any available platform about how the company will answer all your problems.

People buy in, with greater volume over time. If the company can scale high and fast enough, it will go public, the original investors cash out at spectacular margins and they become legends.

It was going well enough in this case for Sam Bankman-Fried to start many charitable pursuits and even buy a sports stadium.

If only that were enough to operate a business long-term…

Before he realized his vision, his competitors at Binance publicly called his bluff and sold their holdings. This triggered a run on FTX’s coins and ultimately collapsed the exchange.

FTX may have survived had SBF not loaned large amounts of holdings to his sister company, Alameda Research. And, through some clever terms of service, he may not be held accountable for his unethical behavior.

So, investors can’t trust wunderkinds who bury tricky clauses deep into their terms of service. They also wonder why they should even start building within a system that’s rigged against them.

What can they do to get spectacular returns to achieve financial freedom? Especially when it looks like work?

Roll Up Your Sleeves

If you don’t really understand how cryptocurrency transactions work when people who trigger collapses do, it’s time to learn some basics.

Let’s face it, the only way any exchange has value is if you can use it to trade for something you need. Most cryptocurrency platforms haven’t been able to accomplish this other than trading a token back into native currency to make a purchase.

When any business scales too fast hoping to someday breach that magical threshold of long-term sustainability, its processes and measurements will not keep up to handle that volume of productivity.

These companies perform at the lowest common denominator over and over again because it’s comfortable and the system can’t do much else.

As legendary investor Warren Buffett advised: “Don’t invest in anything you can’t draw with a crayon.”

So, are you trying to invest in a black box that only makes money when investors pour into it?

Or do you want to make something last? This takes skills.

What Will You Build?

It’s a radical concept, but money is based on the full faith and credit of being able to exchange it for things you need.  Skills are what make things and everyone has needs. 

So… developing your skills is a sure way to bring yourself more money.

If you want to stay in the crypto realm, start learning quantitative analysis, risk management, economics, monetary theory, and psychology.  These skills can tip you off to when the rug is about to be pulled from under you.

For someone giving up on digital assets to thrive in the real world, you can learn different kinds of labor, mechanical aptitude, artistry, or physics. Soft skills like organization, time management, and selling through relationships help build longer-term scale.

Society can collapse tomorrow. Your entire social circle can turn on you. But you still have your skills to lean on. This is what determines whether you starve or rebuild from rock bottom.

All that prevents you from providing for yourself or even living the way you want is giving up on improving. Skills are never an end in themselves: a basic skill can always grow into something greater.

Someone may do parts of your skillset better, faster, or cheaper. You have the choice of grinding to beat them in the same game or to grow into a complementary skill your competition can’t match.

And when you get to a certain point where other people want to do what you do, you can train them to take over it for you. This frees you up to direct their labor…and that can free up more time to build more skills or find new partners and resources.

These are all skills the cryptocurrency exchanges need to build in to their systems in order to provide service befitting their elevated market caps. And if you build on your skillset, it’s going to be harder for people like Sam Bankman-Fried to pull the rug from under you again.

Do you have a skills training program you’re ready to scale? I want to help you drive traffic to your courses. Book a call with me today to discuss your best path forward.

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