Crypto's Free Market Obeys Nobody, Not Even Roger Ver
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Say what you like about Roger Ver, but he certainly doesn’t suffer from false modesty. The founder of Bitcoin.com recently took to YouTube with a series of short videos about his young life, early business forays, and eventual shift from evangelizing for Bitcoin to his now-favorite cryptocurrency, Bitcoin Cash.
The video series is an enlightening testament to free trade and an illustration of market principles, and we recommend it to anyone who wants to understand the role of Bitcoin in the cryptocurrency market. Especially Roger Ver.
The Rockefeller Of Recess
Beginning the video series, Ver shares about his childhood inspiration and recognition of free market principles. He saw the problems of inflation in a rigged economy at an early age when his fifth grade teacher, presumably named “Lindy,” issued “Lindy Land Dollars” to motivate students to carry out tasks around the classroom.
A young Ver saw opportunities to take advantage of the flawed currency system, explaining that many students did not understand that the actual exchange rate from a Lindy Land dollar to USD was “maybe 50 to 1.”
Kids would bring in cookies or Rice Krispie treats and sell them for one Lindy Land dollar — a bargain when compared to their value in USD. Ver laughingly explains how he bought up all the treats and “cornered the market,” after which he jacked up prices.
It was “a fun learning experience,” Ver says, until Lindy Land began suffering from hyperinflation. Despite recognizing the economic problem, Ver overlooked the fact that he himself was instrumental in monopolizing the market, taking advantage of naive classmates to make a quick buck.
You have to give Ver credit, though — he certainly demonstrated an entrepreneurial spirit from an early age. In junior high, he made “20 or 30 dollars a week” selling candy bars to classmates for profit after picking them up at Costco at bulk prices. “For a junior high school kid, that was a lot of money” Ver says.
The Prisoners’ Dilemma
But business really took off when young Roger got into computer sales. Ver bought a mass order of hard drives on the cheap, knowing he could turn around and sell them at quadruple the price to other buyers. Selling the equipment on eBay, he made $4,000 in his first week. That’s when he realized he was on to something, dropped out of college, and started his computer parts ordering business.
Ver’s adage throughout his business career was to “…take a product from where they’re worth less and move them to where they’re worth more.” He shares numerous examples of moving products from one market where they are cheap to another market where they are more expensive, including the sales of Beanie Babies and other miscellaneous goods.
“I can buy them over here where they’re worth less and sell them over here where they’re worth more,” Ver explains. He applied this profit-making principle to a wide variety of goods. Business was booming, until he tried the same sales strategy with firecrackers.
Discovering Bitcoin (Core)
Ver experienced a devastating setback when he was arrested and imprisoned for the illegal sale of fireworks. “It was a sad day…” letting go of his staff, Ver said. His mother helped keep the business running during his time in prison.
Not to be defeated, Ver got back to the grind, even managing to make a few business deals while in prison by making phone calls between buyers, sellers, and his mother. He learned of the many specialized jobs in the secret prison economy.
It was against the rules to trade, but the prisoners found ways to make it happen anyway.“[I]f we weren’t able to trade with each other,” Ver says, “prison would have been much more difficult.”
The prison economy helped Ver to see the function of money and why Bitcoin could work. “When Bitcoin came along, I knew… I knew people were gonna start using it as money,” Ver says.
BTC vs BCH
This is the part most viewers are waiting for. Ver digs into the flaws of Bitcoin (BTC) as opposed to Bitcoin Cash, saying that the notion of acting as a store of value without also being usable as cash is “nonsense.” He promotes Bitcoin Cash as being superior, as it genuinely meets the descriptor of “peer-to-peer electronic cash,” and “is useful in commerce,” he says.
Bitcoin Cash thus has greater utility and therefore more value as money, Ver says. “Bitcoin needs to be fast, cheap and reliable, if we want people to use this as money… and sadly my side of the argument lost out.”
“Congratulations, guys,” Ver adds sarcastically, “You made Bitcoin slow, expensive and unreliable in commerce.”
This is where Ver arrives at a contradiction. Throughout the videos, Ver promotes the ideals and principles of free trade, without interference or control from outside forces. Yet, he is not willing to accept that the free market is already at work, in the fall of Bitcoin Cash and the rise of Bitcoin dominance.
The free market has plainly and unemotionally decided that it wants more Bitcoin and less Bitcoin Cash. No matter how much Ver insists that Bitcoin Cash is the superior solution, the free market has chosen otherwise.
In the early stages of the Bitcoin Cash fork, markets struggled to decide on the superior technology, and prices indicated that many felt Bitcoin Cash might be the better option. At one point, BCH traded for thousands of dollars.
Over the course of time, however, it has become more clear that the market prefers Bitcoin (BTC) — which is now trading steadily around $10,000 USD. Bitcoin Cash has lost the free market battle. And the free market is the only force that gets to decide.
Perhaps Ver is simply up to his old tricks, taking advantage of ignorant buyers with clever sales tactics. He brags repeatedly about past successes, in which he exploited irrational markets, and preyed on the ignorance of buyers to garner a profit. Is the Bitcoin Cash sales ploy any different?