Most of sending cryptocurrency by John Oliver were on hand.
In the episode of "Last Week Tonight" on Sunday night, the HBO host was mocking bitcoin community icons like Brock Pierce and reminded viewers to demonstrate caution when they were investing.
"The important thing to remember here is that it's a brand new, very complicated space and literally nobody knows how it will develop, so you have to be careful," he said.
Oliver's explanations of blockchain technology and the emerging cryptocurrency industry were generally accurate, and cautionary notes were appropriate. Speaking of notes, the parody of Carlos Matos, the exuberant Bitconnect promoter of guest star Keegan-Michael Key, brought out the point when he yelled, "Re-spon-si-bility!"
But on an important point, Oliver missed the target of a shot from a distance.
In his efforts to tell the story to a wide audience, the comedian trots a tired analogy, comparing the volatile price of Bitcoin to a $ 15,000 Beanie Baby, the stuffed toys that pushed Americans to the late 1990s
He also described the purchase of cryptocurrency as a game of chance and not as an investment – a simplification at the very least.
It's been two decades since the Beanie Baby craze of the 1990s, and some of the toy animals are still selling for thousands of dollars online. The rare toy evaluator Bruce Zalkin, for example, told the Wall Street Journal that a trio of Beanies sold for around $ 1,299 in 1998 would likely be $ 50 today.
This devaluation highlights what makes Beanies fundamentally different from cryptocurrencies. Beanies has introduced no new technology to the collectibles market. Aside from unique features such as color, these toys have generally remained the same over the years.
In comparison, bitcoin offered building blocks for the blockchain technology boom that swept the globe.
This technology applies to everything from medical records to real estate transactions and derivatives. Cryptocurrency itself already has various use cases, such as helping sex workers to safely store wealth despite discriminatory banks. Some entrepreneurs, like Korean beauty contractor Sunny Park of Moonic, accept cryptocurrency to help international customers avoid conversion rates and expensive credit card fees.
A report from Digital Asset Research in 2017 went so far as to estimate that the use cases of current bitcoins would make the value of the currency around $ 2,074 without speculation. Even if it is well below the current market price, it is sure that Satoshi is not bad.
Blockchain Capital partner Jimmy Song emphasizes that decentralization plays an important role in differentiating Bitcoin from other speculative assets.
He told CoinDesk:
"The Beanie Babies are made by Ty and you have to trust them not to flood the market with more Beanie Babies … Bitcoin looks more like gold that is not not produced by a central part. "
In addition, the underlying structure of bitcoin continues to undergo technological improvements.
A beanie or gold ring bought today will not benefit from new features as it is on the shelf. Meanwhile, people around the world are working to make bitcoin faster and easier to use. If someone uses their cryptocurrency memory after several years of storage, this digital asset may have acquired new capabilities.
It can even offer access to additional tokens deposited by airdrop, such as when bitcoin owners claimed free bitcoin cash tokens after the bitcoin network fork. These users have passively collected new tokens simply by owning bitcoin.
Physics versus Digital
In this way, comparing a dynamic cryptocurrency to a physical asset is at best apples and oranges.
Bitcoin is both traceable and generally fungible, that is, mutually interchangeable (though, to be fair, these features may conflict with each other).
In contrast, some physical assets are registered or certified, while gold bullion may be theoretically interchangeable. Few assets offer both options. Song pointed out how the bitcoin features differentiate it from other assets.
"In addition to decentralization, these properties include fungibility, portability, durability, verifiability and divisibility. Beanie Babies is of varying quality, even in the same toy, they must be shipped and may be damaged. smaller units, "he said.
Collectables based on Blockchain, like the CryptoKitties, a game powered by etheric, have much more in common with Beanies. They are appreciated for their rare traits and mainly used for entertainment or commerce. Yet even digital kitties offer potential beyond their soft and spongy predecessors.
People can create their CryptoKitties to create a new digital asset, which is obviously impossible with physical collectibles. Bryce Bladon, director of communication at CryptoKitties Axiom Zen Genesis Studio, told CoinDesk:
"Personalization, interactivity, extensibility – everything is possible with things like cryptocollectibles."
All in all, the only thing Beanies have in common with bitcoin is scarcity.
Regarding the comparison of games, crypto-currency is an extremely risky investment, as Olivier rightly pointed out. But depending on the buyer, this is not necessarily a roll of the dice, because the expertise can decipher which cryptocurrencies have functional use cases.
The rest may indeed prove to be a collectible stuffed animal.
Baby Beanie image via Shutterstock