The fundamental lie of Crypto.

Sometime in the future, people will smugly laugh in their history class as the AI instructor tells them of a period in the early 21st century when there was such an oversaturation of capital and nowhere to put it, that there was no investment too speculative or terrible to buy in bulk. The silly primitives of the 21st century had so much money and so few places to put it, that they made up entire asset classes of nothing but imaginary assets, that only existed because you believed they did.

There is a fundamental lie of crypto that you have to tell yourself when you first get a wallet in the mail: Its what every cryptobro I know tells me when we discuss it. They say "its a hedge against inflation, its the future. (insert currency) will replace fiat currency some day, and its a much better place to put your money" or something like that.

But no one, not even they, are buying crypto to use as an inflation hedge. They're buying it as a highly speculative growth asset, and deluding themselves that their true motivation is different. But if crypto were truly a currency, truly a hedge to inflation, it would follow currency patterns, not equity patterns. It never has and never will. It will remain forever an interesting anarchic idea, stillborn by the very adoption of it.

Thus, the price and volatility lay bare the lie: the market knows the truth even if the players themselves will never admit it.