Why Your Kids Want Cryptos For Christmas
Originally posted by Katie Johnson @ marketsandmoney.com.au
There was no false advertising to speak of when it came to this toy. It was literally a smooth rock housed in a box with the label: ‘genuine pedigreed pet rock’. Its selling point was that it was the perfect pet — it required no maintenance, and best of all, there was no chance of accidentally killing it.
It sounds ridiculous to us now. But nonetheless, in 1975, that rock was all the rage. And the genius behind the idea, Gary Dahl, died a multi-millionaire.
Come 1980, the most popular toy was the Rubix Cube. In 1987, it was Jenga. And in 1993, the Talkboy (the portable cassette player/recorder popularised by Kevin McCallister in Home Alone 2) was flying off shelves.
As the years went on, and technology began to advance, so too did the toys. Soon enough we had the Tamagotchi in 1997, Tekno the robotic puppy in 2000, and the Xbox 360 in 2005.
But the kids of today aren’t as impressed by barking robot dogs, cassette players or even cash.
Because according to the consumer report released by investment bank Piper Jaffray this week, virtual currencies have overtaken cash and gift cards as the preferred Christmas gift.
Teenagers are now asking for cryptocurrency or ‘V-bucks’ — the virtual currency used in the popular video game Fortnite — instead of more traditional holiday gifts.
As this trend has grown, virtual money in video games has become big business. To upgrade your gaming experience, or change your avatar, Fortnite requires you to hand over the cash. It costs $9.99 to purchase $1,000 V-bucks, which kids and parents have clearly been forking out for, as the game has grossed more than $300 million since it launched in March.
It appears we’re past the days of toy trucks, pet rocks and Barbie dolls for Christmas. Kids today aren’t excited by the prospect of physical toys. Instead, they crave the limitless possibilities offered by virtual wonderlands, and shiny digital coins.
The ghost of crypto
In some respects, cryptocurrencies are similar to the virtual money you find in a video game. You buy them with fiat currency, they have no tangible form, and you can use them to buy the goods and services you desire.
The only difference is you can use cryptos to change your avatar and undergo adventures in the real world. A concept that was very enticing to those who were fed up with the traditional monetary system.
But after bitcoin and other popular cryptos fell from the dizzying heights we saw at the end of 2017, the general consensus has been that the crypto dream is dead.
As of Wednesday, bitcoin hit its lowest level this year. It fell over 9% to $5,640.36, leaving the remaining crypto bulls wallowing in despair. To be fair, it would be quite the disappointment to see your investment drop from $19,783.21 to under six grand.
Other well-known cryptos also fell on Wednesday, with Ether dropping 13% and XRP, the third largest crypto by market cap, tumbling 15%.
This massive decline comes after a number of major crypto exchange hacks over the past year, recent volatility surrounding bitcoin cash, and an overall dampening of confidence when it comes to the viability of cryptos in general.
According to eToro Senior Market Analyst Mati Greenspan, ‘Another contributing factor is the selloff in tech stocks, which could be having a spillover effect into crypto markets.’
But despite all of the negative press, those who have been following the crypto journey from the very beginning remain resolutely optimistic about crypto’s place in the future of money.
As Circuit Capital partner Eugene Ng told Bloomberg:
‘Despite what is happening with prices, we’re seeing adoption growing and a lot of people are looking to scale crypto businesses. We are starting to see talent moving into this space and institutional infrastructure developing.’
Our own Sam Volkering is another such expert who continues to write extensively about why he believes cryptos will eventually overtake the fiat system to become the number one global currency.
He has even written a book, Crypto Revolution, which answers all of the frequently asked questions about whether crypto is merely a passing fad, what its origins are, and what the best way to buy and sell cryptos is.
Only two days after its release, Crypto Revolution became the #1 best seller on Amazon Australia. And at this rate, we’ll run out of copies soon. But don’t worry, you can grab an e-book version for just $7.95, right here.
This week in Markets & Money
As Sydney clearance rates head lower, we are starting to see some nerves around property. According to the latest Domain figures, Sydney’s preliminary clearance rates were 41% for the last weekend, with a bunch of properties not even making it to auction. This is a stark contrast from last year, when clearance rates were in the mid-60s and most properties were selling at auction. And as Selva wrote on Monday, with credit tightening, things are only going to get worse…
To learn more, click here.
Then on Tuesday, Selva noted that gold is on the move. In the last few years several central bankers have been repatriating their gold back home. Germany, Venezuela, Austria, Netherlands and Turkey have all asked for some of their gold back. This has meant that foreign gold held at the New York Federal Reserve is now at a record low.
To find out what this means for the global economy, click here.
Back in 2008, as things got tough, central bankers rushed to the rescue. To boost the economy, they lowered interest rates and poured trillions of dollars into the financial system. But despite these efforts, 10 years on, the recovery has been weak. And as Selva wrote on Wednesday, the next chapter in this story is on the horizon…
To learn more, click here.
US tariffs on China are having an unexpected effect. The US has been running a large trade deficit for decades, mainly with China. And Trump has complained that this trade deficit has led to a loss of jobs in the US and is why wages aren’t growing. But as Selva wrote on Thursday, that isn’t the whole story.
To learn more, click here.
Facebook is in the spotlight, and not for a good reason…again. It appears they have gone to even greater lengths to influence political outcomes than first thought. And as Selva wrote on Friday, we might need to distance ourselves from the social media giant for our own good.
To read more, click here.
Until next week,