TLDR: Don’t sell “Bitcoin Classic” to buy “Bitcoin Fresh”
Marvin Threshel was just like any other miner. He’d crossed the great expanse of the western plains to end up in California. He sifted and panned, and got in early enough to amass a large amount of gold.
He expanded his operations. He brought in miners from China, and before you could blink, he ran the largest mining operation for 200 miles. Things were good and he controlled a large percentage of the gold flowing out of the region.
One day, Clint McDrilkins decided to try and change the gold standard.
“Gold’s too damn heavy. It’s a pain in the ass to cart across. Hell, it’s all speculative anyways. Let’s swap to a lighter standard. Pyrite looks like gold and is way less dense. People’ll never figure out the difference.”
Clint reached out to Marvin with a proposal.
“Marvin, you can continue mining gold. Just make everyone wear this hat and overalls while you’re mining. On August 1st, if everyone’s wearing the hat, we’ll provide you with an exact match of Pyrite as you hold in gold. Let me tell you though, Pyrite will move faster and have a better governance — so make sure you prop that up as the new gold.”
Marvin smiled and said, sure.
For a few months, his team of miners wore their special hat and special overalls. All the lone gold traders and miners started to speculate.
“I guess everyone’s moving over to Pyrite, judging by them overalls”.
On August 1st, Clint fulfilled his promise. He gave Marvin exactly the same amount of pyrite as he held in gold. Marvin thanked him and for a few days, stopped selling gold. He put a few pieces of pyrite on the market and slowly trickled in more at higher prices. People began to get scared of missing out, so they sold Martin their gold at a low, bargain price to get their hands on this great Pyrite resource.
After a few weeks of accumulating all the old gold at a low, low price Martin sold all of the Pyrite at once. After all, it was fool’s gold. This crashed the Pyrite market, and suddenly gold shot up to 2x,3x more than it had been previously.
Clint asked Martin what he thought he was doing.
Martin said it’s all about speculating and why the hell would you fork the gold standard, you dimwit.
- @ July 10, 2017 3:34 pm