Bitcoin slumps below key $20k threshold

Thus, the issue is solved via currency reserve requirements. Crypto on the other hand can’t solve the problem because they can’t set laws so anyone can set up a Bank using on chain wallet(s) and then issue loans and offer interest on deposits etc.

Money is an IOU (it also ends up having other uses, but fundamentally that’s what it is). That’s fundamentally all it is. And it’s also a unit. It’s a technology that allows me to determine that if 5 chickens are worth 1 sheep, and 3 sheep are worth 1 cow, then 1 cow is worth 15 chickens, without ever having to spend a second to do any math. This is essential in a complex economy where there may be millions if not billions such conversions.

Money that is useful for the purpose of smoothening the running of an economy has a few properties.

1) It’s value stays fairly stable. This means that people are confident spending money and receiving money that the value they agreed upon now will basically be the value tomorrow, so they don’t have to do additional work to figure out when they should make the transaction for optimal value (and since the optimal time is the opposite for both parties, it’s very difficult to find such a time and it always results in a win-lose situation).

2) It’s slightly inflationary. Money sitting under a mattress represents work that could be done that isn’t. This is a real waste of human output, because time is limited. So you want a slightly inflationary money to encourage spending and investment.

3) Money supply reflects the productive capacity of the economy. If the capacity of the economy grows, either due to more workers, or due to better productivity, the money supply needs to grow. Otherwise there will not be enough dollars to enable work to be done and we will waste human time and output simply because we don’t have enough of the means of exchange.

All of this is a difficult balance to strike, which is why you need people controlling the flow of money. We may eventually come up with algorithms that could measure a variety of real world inputs, such as the prices of goods, working population, productivity, etc. that can do that without human input, but it’s not possible yet because we don’t know the economic rules of how things work, so it becomes a matter of almost trial and error guided by some basic economic rules.

I've met "normals" that introduced themselves as "in tech" and then revealed that they meant some NFT/crypto scam BS.

That's embarrassing. The transistor and the Universal Turing Machine and the Internet were not invented so people could sell each other imaginary pet rocks.

I know why they do it: we all would like an easy way to make money using a computer! D'uh! (I count myself very fortunate that I'm good at programming, if I wasn't I'd probably be homeless.)

But... there has to be a better way!

I'm surprised everyone's acting like it hadn't been down below 20k since 2017. Sure, it wasn't for long, but it did happen in 2020.

[0] Before posting I looked it up and what I'm finding is a lowest in 2020 of $4,861.32 for March 12th. I vaguely remember lower numbers, but this is aggregated data, so it might've been lower during the day but that was the closing price or the mean or something. I'm still sticking with the 4k number for quick reference, though you can take it as 5k if you want -- it's still a lot lower than the 20k that's making the news currently.

I wonder if the effect is magnified in assets with higher retail market share (e.g. meme stocks and crypto)

Doubt it. People who've made a thousandfold gain probably think that's the best it is going to do, so they sell.

If you bought into BTC at $1, chances are you never held it all the way up to $20k.

What can I do with crypto? Maybe exchange it for cash if I’m lucky and willing to pay a high fee?