Bitcoin is Not a Pyramid Scheme - Unchained Capital
Bitcoin is Not a Pyramid Scheme - Unchained Capital
What Is Bitcoin: Explanation for Beginners in Simple Terms ...
Will the Real Ponzi Please Stand Up? - Crypto Spotlight ...
OneCoin Claims It's Not a Ponzi or Pyramid Scheme - CoinDesk
Ponzi Scheme Definition - investopedia.com
Passive investing strategy
I have been holding crypto and following the ecosystem for a long time, and I believe crypto will revolutionise the financial system and still has much potential to increase in value. However until now my holdings have been mostly handpicked. In traditional investments I am a subscriber to passive investing and usually invest in broad index funds, and I want to apply that investment philosophy to my crypto holdings. With this in mind I looked at some available crypto indices and none of them seemed to fill my needs, but looking at them helped me define some of the criteria for my own index:
Not too broad
I will be reproducing the index manually, so having too many assets will make the extra hassle of trading and storing the small-weighted assets not worth it.
I don't see the point of including stablecoins in a cryptoasset index. If I wanted to invest in the asset the stablecoin tracks I'd be better off holding the followed asset itself.
Exclude centrally managed tokens
All indices I found included assets such as Binance Coin and OKB. I see investing in such assets as investing in the managing entity and not in the crypto ecosystem itself, as those tokens will be much more correlated with the business success of the entity than with the success of the ecosystem.
Require reasonable trading availability
The asset must be available for trading in a reasonable number of exchanges.
Market capitalization weighting
Free-float market cap weighting is the standard method of weighting whole-market indices. I have seen some indices that use square root of market cap weighting in order to not be so Bitcoin-heavy, but I am not convinced that that is a better representation of the market or that it would lead to better returns. With these criteria in mind I evaluated the top coins by market capitalization. I decided to use CoinGecko as my main source, but I do cross check the values with CoinMarketCap and CoinCap.io to avoid some big flaw in CoinGecko's methodology.
Obviously the big guy is in.
I also have no issues with Ethereum.
Ripple is a bit too centrally-controlled for my taste and there's also the worry that the value of the XRP token itself may not be too correlated with the network's success, but I still consider it to be worthy for inclusion.
Tether is excluded due to being a stable coin and being centrally-controlled.
The only thing that worries me about Bitcoin Cash is that the community seems to be too worried about insisting that it is the true Bitcoin instead of developed, but I don't see any reason to exclude it given my criteria.
This is the first asset with which I don't have too much experience. Their website is a bit too heavy on buzzwords, but my research seems to show that it is a real network, there's no big problems with their whitepaper.
I personally have no idea how Bitcoin SV is so high in market capitalization, as I see it as just Craig Steven Wright's tool to strengthen his Satoshi claim, but the point of the index and the criteria is to remove my personal feelings from the decision, so it stays in.
Litecoin is one of the oldest assets around and I have no objection for it.
This is the first one where I am having a hard time deciding if it stays in or not. Its website is full of buzzwords. They have a whitepaper explaining how the network works, but I can't see it as much more than a centrally-managed token with a bunch of apps around it and no real value proposition. The company itself seems shady, having been through a name change, as it was previously called Monaco, the way their cards work smells heavily like a Ponzi scheme, they promise huge interest rates for staking random coins with them and the amount of people that show up speaking well of it in any post about it reeks of paid shills. For some reason it is also not listed on CoinCap.io, although it is listed on CoinGecko and CoinMarketCap. It is also listed on fewer exchanges than other coins we've seen so far. I couldn't find any concrete evidence of it being a scam, but I am excluding it for being a centrally-controlled token.
This is a Binance-controlled token, so it is out.
I also didn't know much about this coin, but my research didn't raise any red flags about it, so it's in.
This one is an ERC20 token, but it is managed by a smart contract and although it seems to be somewhat centrally-controlled by now it does have a governance model to make this control be diluted over time. It is also trying to solve a real problem, so it is in.
I was not too familiar with it, but after researching about it I really like the idea. I see no problem in including it.
Stellar feels to me a bit too much like Ripple 2.0, but I don't have any concrete problems with it.
This is an OKEX-controlled token, so it is out.
Another one of the old kids in town, I have no problems with it.
I have a "too buzzwordy" feeling about TRON, and I feel it is a bit too much connected to its founder, but no concrete problems as well.
This is a bitfinex-controlled token, so it is out.
USD Coin is excluded due to being a stable coin and being centrally-controlled.
This is an asset that I am not too sure I understand completely, and it is not listed from CoinCap.io and its market cap is not computed on CoinMarketCap. From what I can gather a cToken is meant to be a token that identifies that you have deposited in Compound's loan market. The only place where it is really traded is in the Compound exchange itself, and it's value is tied to the interest accrued from the loans in the platform and to the underlying asset, which in this case is DAI, a stablecoin. I find Compound Finance interesting and intend to read more about it, but I don't think cDAI is fit for my index, as it is not freely tradeable and tied to a stablecoin.
This is a Huobi-controlled token, so it is out.
This is one more buzzwordy smart contract platform with no concrete red flags to it.
A fork from the main Ethereum chain that rejects the rescue of stolen funds from a buggy smart contract. I am sympathetic to the idea of rejecting a centrally-proposed hardfork, and I see no red flags with this coin. And with this we are up to my intended 15 assets. This is the composition of the index with current market capitalizations:
This is the portfolio I intend to target from now on, with occasional rebalances of course. I would like to hear what you think about my criteria and my application of them, and where I could improve it.
Can Cypherium be My Next Moon Bag After ChainLink !!!
When I first brought my Chainlink in Dec 2018, it was valued at 0.35. I brought 4000 units of Chainlink at 0.35 per coin ( Total Cost $1400). In the coming week, the price crashed to 0.20. Irrespective of taking huge losses, I still didn’t sell my Link as I had trust in the project. I came across various twitter accounts giving negative predictions about Link and how this can again go down further but I kept HOLDing. Now you may ask why? To invest in a project and to understand its future value, we need to put some efforts to do a little bit of research about the project as well as the impact it can make in the future. What Is Chainlink ChainLink is a decentralized oracle network that provides real-world data to smart contracts on the blockchain. LINK is the digital asset token used to pay for services on the network. In the Ethereum Scheme of Things, Chainlink is very important. With ChainLink, smart contract users can use the network’s oracles to retrieve data from off-chain application program interfaces (APIs), data pools, and other resources and integrate them into the blockchain. Basically, ChainLink takes information that is external to blockchain applications and puts it on-chain. For many of the blockchain protocols out there, oracles like ChainLink will be necessary to access the data that these protocols need to operate. As such, ChainLink is, as it names suggest, the link that connects blockchain to existing infrastructure. For me, I have understood that Etherum smart contracts have a huge potential, and these smart contracts needed real-time price feed data collected from sources both on and off blockchains. Chainlink was the first mover in this direction and that paid off really well. I have recently sold the bulk of my LINK portfolio in the recent pump. This is not because I don’t see any future with LINK, But I feel i can generate more profits with new projects I Belive in HOLDing. If I break down my portfolio, 80% of them are long HOLDs. 20% of them are for gamble the uniswap shit/farmcoin frenzy. I belive these Quick Rich projects that come out daily will continue for couple of months. After that what can survive are the projects that have solid base with future outlook. Central Bank Digital Currency — The next big thing !! Recently Philadelphia’s Federal Reserve bank president Patrick Harker came out with a remarkable statement that it is “inevitable” for the central banks, including the U.S. Federal Reserve, to start issuing digital currency. This is a great leap for blockchain from being labeled as a Ponzi in the past and now attaining a status of legitimacy. As per a research report published by Bank for International Settlements (BIS), 70% of banks are engaged in or about to start CBDC work, and of these more than half are exploring both general purpose and wholesale CBDCs. Lets first have a look into the concept of digital currency. As defined by IBM A central bank digital currency is a digital extension of a central bank’s medium of exchangeable to permanently settle transactions between parties. The central bank is able to remove credit risk and ensure stability by guaranteeing the value of the CBDC withblockchain, exactly like paper money. The present concept of CBDCs was directly inspired by Bitcoin, but CBDC is different from virtual currency and cryptocurrency, which are not issued by the state and lack the legal tender status declared by the government. Proposed implementations may not even use any sort of distributed ledger In the beginning, CBDC was a slow-moving project. With the arrival of Facebook LIBRA, the development of CBDC became a high priority for Most of the nations. This is how I came across Cypherium. Cypherium Cypherium is an enterprise-ready blockchain project, which is designed to be highly scalable and robust which utilizes a hybrid design that features a joint Proof-of-Work (PoW) and HotStuff (Also adopted by Facebook’s Libra) consensus mechanism that can allegedly achieve thousands of transactions per second without sacrificing decentralization. Cypherium is designed in such a way to focuses on achieving scalability, decentralization, and commercialization viability. If you want to have a detailed read about the project, you can read here Can Cypherium pull a LINK performance? For me, Yes. Why? . I base my argument on the belief that I will be holding this project for at least a couple of months to come. These are not quick buy- sell that you can make an instant profit/loss 📷 If you want to make good profits (10–15x in NOOBS term), the best option is to have your entry in the beginning. Either you have to get the tokens in ICO or wait for the listing and time your entry (Most the quick flippers sell their token which will lead to massive price drops). Once the dust settles, most of the projects go through an accumulation phase, and once it gains enough goodwill in the market it booms. Chainlink was trading in the range $.20 to $ .30 for a couple of months and now it’s trading at $13– $15. It took almost 2 years for LINK to reach here , Hope you got the point 📷 LINK was the first mover when it came to Oracles. Similarly, When it comes to CBDC, Cypherium has the edge. Cypherium has formed a Thinktank called Official Forum of Monetary and Financial Institutions (OMFIF) which is now leading research and development in the field of CBDC. Most of the leading Central Banks are part of the initiative and it is expected that all these CBDC, if launched, will be running on Cypherium blockchain (High Chances). That means huge goodwill for the project, Huge upside for the CPT coins 📷 One of the greatest strengths of LINK is its partnerships. Similar to LINK Cypherium has already made Cypherium Enterprise available as Blockchain-as-a-Service for enterprise customers through the stack platforms of Google, Amazon, Microsoft, and IBM. Cypherium is already a part of IC3 alliance in which Chainlink is also a part of. This means again more positive for the project to go up All of these are my assumptions. This can even go wrong. But that the risk I am willing to take.I am sure this will pay off very positively for me
Summary of Tau-Chain Monthly Video Update - July 2020
Karim Agoras Live: Five functionalities complete: 1. Registration 2. Login 3. User Profile Page 4. Calendar 5. Categories List 6. Wallet Screen Payments: Decided that implementing lightning would be too complex. Instead, we decided to implement our own micropayment mechanism using the native BTC multisig addresses. We are going to use the Omni wallet for payments. TML: Continued debugging, getting a TML demo and test cases ready. Hiring: More hiring efforts to increase team size. Timelines: Committing ourselves to a release of Agoras Live and a basic version of discussions in TML in 2020. Umar: Been working on making improvements to the context free grammar parsing. We now are able to add constraints to productions in the grammar, allowing us to recognize grammars that are context sensitive. Developed test cases for that, too. Tomas: Fixed issues in TML and ran several steps in a TML program. Now adding more tests to make sure everything is stable and won’t break. Also been working on a TML tutorial, a recorded script based on the intro to TML which was contained in the TML Playground. Also new features are going to be covered such as arithmetics. Kilian: More outreach & follow-ups to potential partner universities. Positive response by a professor based in Toronto, presented to him our project. Also, response by KULeuven, Belgium, who unfortunately don’t see a good fit in our project. We’ve had one applicant for the IDNI Grant program and currently are evaluating his proposal. Also, we’ve had an applicant from Bangalore, India for the IDNI Ambassador program and we also have been discussing his proposal. Translation Bounties: We’ve had the blog post “The New Tau” translated to Chinese and have been reviewing the translation. We are going to publish the translation on our website and on the Bitcointalk Chinese forum section. Still to be claimed: German translation of “The New Tau”. Done more effort on reach out to potential tribe channels: Research groups, LinkedIn groups, Facebook groups. Most represented keywords: Complex Adaptive Systems, NLP, Computational Linguistics. Usual feedback: Likes but no further interaction. Created an FAQ answering all possible questions surrounding IDNI, Tau & Agoras Idea: Hosting a virtual panel to spread the word about our project among the scientific community, as well as to create some visual content for our community. Two professors are interested in participating, one from Argentina with a focus in semantic parsing, the other one from the University of Washington with a focus on human-computer interaction and social computing. First step: organizing a pre-panel discussion where in 1on1 calls with the professors we get an opinion of them about what we are doing. Andrei: Agoras Live: Implemented mail system so users now get their mails (e.g. registration email). Improved UX together with Mo’az, e.g. user profiles. Token creation for accessing calls to identify and charge users. Customized Jitsi interface to suit our needs: E.g. display of how much time passed in a call and how much it costs. Next up: Further improve UX; make sure everything works as intended. Mo’az: Almost finished the IDNI website. Added two more pages: Events & Bounties in collaboration with Fola & Kilian. Agoras Live: Finetuned all the website’s components in collaboration with Andrei. Juan: Continued working on the payments system for Agoras Live. Had some delays due to the complexity of debugging such applications. Still, we made significant progress and got the funding transactions implemented over the Lightning network through the Omni layer. Spent time analyzing the minimum amount of BTC to pay for the fees associated to the Omni transactions. We aren’t using segregated witness native addresses and instead are using embedded segregated witness. So transaction sizes are enlarged and transaction fees are a bit higher. So there is a bit of finetuning analysis needed in order to enable the multisig address to pay for the closing & refund transactions. So to provide payment channels over the Omni layer, the main remaining technical detail we have to solve at this point is the closing transaction & the refund transaction. Fola: Have been continuing to look for great talent in different areas. Continued working on website with Mo’az and Kilian. Been working on the branding for Tau & Agoras. Been getting external support to make sure the branding for Tau & Agoras will be as professional as it can be. Working on marketing efforts needed for the release of Agoras Live to get the media pack for marketing ready. Working together with external people to put a plan together for listing the Agoras token on more prominent exchanges as we get closer to release of Agoras Live. Ohad: Continued working on restricted versions of second-order logic to understand how to implement them. There is a translation in the literature about how to convert second-order logic by Horn into Datalog. Also, I have been revisiting papers that deal with descriptive complexity of higher-order logic. They mention that they have a translation from second-order logic to QBF. I wasn’t able to find where they explain this translation but I wrote one of them and he said he will send me the paper. If so, that will be very good because we already have a QBF solver. Any binary decision diagram is already a QBF solver, so we can just translate arbitrary second-order logic formulas into QBF. This will be very helpful for us to implement second-order logic. Also, those papers mention several aspects that are relevant for self-interpretation, the laws of laws. Apparently, they suggest that certain fragments of higher-order logic may also support the laws of laws. But this is part of the papers that I didn’t have access to, so I have to wait to get further clarification. I also pushed the whitepaper significantly this month and hope we will be finishing it soon. Also, I was thinking about some optimizations for the parser and also was looking into the Lightning network. It was my mistake that I haven’t done so beforehand and if I had done it beforehand, I would have understood earlier, that Lightning is too much. It is too drastic of a change to how traditional payments work and there apparently is no reason to believe that it is secure. So I’m glad I discovered better now than later that it’s not something we’d like to rely on, although we can have it as an optional feature. Q&A: Q: With the project development taking longer than other projects such as Tezos, when can AGRS holders expect something to be released and, how can you reassure us that we made the right decision? A: With regards to when we see some releases, it seems that we will see some releases in 2020. For comparing to Ethereum and Tezos: Let’s first talk about funding. Both projects had a lot of money. For Ethereum, the reason for is that it has probably done one of the most aggressive marketing campaigns in history. It was completely lacking any kind of honesty. It was simply aggressive. None of Ethereum’s visions and promises became true. It simply became an insecure platform for scams. None of their vision of creating a world computer, of creating a better society, a better currency, became true. Because of this aggressive marketing, they not only raised a lot of money, they also took the price to be so high in the market. If you remember the campaign of the flipping, they did a whole campaign on how they would overtake the marketcap of Bitcoin. For Tezos, they made maybe the largest ICO in history in terms of money, mainly because they came at the right time, at the top of the bubble in 2017, and also their promises for better coordination didn’t come true. Their solution is based on voting and based on Turing completeness and the only reason why they managed to gain such a market cap as of today, is not because they offer better currency, better society, better anything. It basically is a Ponzi-scheme because they offer very high interest rate by very high inflation (5,51%). The only reason why people buy Tezos is to get into this Ponzi-scheme. Because both Tezos and Ethereum lack any true economical or technological substance, their value will not sustain and this is true for almost all projects in the cryptocurrency world. In the software, high-tech market, if you come up with good tech and you do all the right things, you succeed big time. But if you don’t have it and you are purely relying on brainwashing people, it will not sustain. Of course, our solution is so disruptive and sustainable. We offer to do advancements for humanity and for economy. Q: What three subjects would you first like to see discussed on Tau? A: Of course, picking three subjects now is a bit speculative, but the first thing that comes to mind is the definitions of what good and bad means and what better and worse means. The second subject is the governance model over Tau. The third one is the specification of Tau itself and how to make it grow and evolve even more to suit wider audiences. The whole point of Tau is people collaborating in order to define Tau itself and to improve it over time, so it will improve up to infinity. This is the main thing, especially initially, that the Tau developers (or rather users) advance the platform more and more. Q: What is stopping programmers using TML right now? If nothing, what is your opinion on why they aren’t? A: There is nothing essentially missing in TML in order to let it release. And in fact, we are now working towards packaging it and bringing it towards a release level. For things like documentation, bug fixes, minor features, minor optimizations. We indeed actively work towards releasing TML 1.0 and then we can publish it in e.g. developers channels for them to use it.
A brief about how the current bailouts are illegally violating the constitution.
https://www.hussmanfunds.com/comment/mc200420/ BITCOIN This is an explanation why the Feds recent actions are illegal. Its from John Hussman's new post which also talks about the spread of SARS-COV-2 and stock market valuations and internals. Both the Federal Reserve Act and the recent CARES Act places very clear restrictions on the types of assets that the Federal Reserve can purchase, and the conditions that must be satisfied in order to purchase them. Congress went so far as to include a section in CARES to emphasize these requirements “for the avoidance of doubt.” Put simply, Fed purchases under the Federal Reserve Act are restricted to assets that are explicitly guaranteed as to interest and principal by the U.S. government, or that has a claim to sufficient collateral to avoid losses to the public. The securities that the Federal Reserve is legally allowed to purchase are: a) Section 14 open market purchases of securities that are fully guaranteed as to interest and principal by the U.S. government or a foreign government; b) Section 14 purchases of “commercial bills of exchange” arising out of commercial transactions. What are those? See the definition in Section 13(2), which defines commercial bills of exchange exactly as they’re commonly understood: arising out of commercial transactions, secured by agricultural products, goods, or merchandise, with a maturity of less than 90 days, and specifically prohibited from “covering merely investments, or issued or drawn for the purpose of carrying or trading stocks, bonds, or other investment securities, except bonds and notes of the government of the United States.” c) Section 13(2) discounting (i.e. prepayment) of commercial, agricultural, and industrial paper (again, bills of exchange); d) Section 13(3) emergency lending to individuals, partnerships, and corporations, restricted to discounting notes, drafts and bills of exchange, and contingent on collateral (“security”). Section 13(3) also requires that these activities must be for “the purpose of providing liquidity to the financial system, and not to aid a failing financial company, and that the security for emergency loans is sufficient to protect taxpayers from losses.” e) Section 13(4) and 13(6) lending for payment of sight drafts for agricultural transactions, and bankers acceptances which typically arise out of merchandise transactions. That’s it. The menu is very specific: either government securities, or those that are backed by a pledge of collateral “sufficient to protect taxpayers from losses.” This principle is consistent with the U.S. Constitution: only Congress has fiscal authority. The Federal Reserve does not. If this is not taken seriously, the Fed could purchase whatever security it wished, at whatever valuation it might choose, and the American public would be on the hook for any losses. On April 9, the Federal Reserve announced the creation of the “Secondary Market Corporate Credit Facility” (SMCCF), that would leverage $75 billion of CARES funding from the U.S. Treasury to buy as much as $750 billion of corporate debt and ETFs. The initial allocation from the Treasury covers $50 billion for “primary” lending (directly to companies), and $25 billion for “secondary market purchases” of outstanding corporate bonds from investors. That Treasury funding is fine. Congress allocated the $75 billion in Treasury funds as part of the CARES Act. Every dollar provided by the Treasury acts as a Federal guarantee for the equivalent amount of corporate obligations that the Federal Reserve purchases. The problem is that the Fed intends to leverage these funds 10-to-1 without taking actual collateral pledges from the underlying companies. This exposes the public to outright losses in the event that declining market prices or corporate defaults reduce the value of these bonds by even 10%. As a result, the newly created SMCCF is either a Ponzi scheme at public expense (if the Fed plans to allow portfolio losses to exceed 10%) or a 1987-style portfolio insurance scheme (if the Fed plans to liquidate securities into a falling market in order to cap its losses at 10%). Section 13(3) requires updates every 30 days on the “value of collateral” – that’s going to be an interesting dance if we break the March lows. In any event, even here, the SMCCF is already illegal. Uncollateralized junk bonds are being treated as their own collateral. What makes this so brazen is that when Congress approved the CARES Act, it wrote the terms and conditions section like a children’s book, “for the avoidance of doubt” – to prevent exactly this sort of abuse of public funds. Specifically, here is section 4003(c)(3)(B), which limits how the $500 billion of 4003(b)(4) funding provided for businesses, states, and municipalities may be used: 4003(c)(3)(B) FEDERAL RESERVE ACT TAXPAYER PROTECTIONS AND OTHER REQUIREMENTS APPLY. – For the avoidance of doubt, any applicable requirements under section 13(3) of the Federal Reserve Act, including requirements relating to loan collateralization, taxpayer protection, and borrower solvency, shall apply with respect to any program or facility described in subsection (b)(4). CARES Act Section 4003 and Federal Reserve restrictions (violated) Has the Federal Reserve taken collateral pledges from the companies underlying these “loans”? Has the Federal Reserve ensured that “the security for emergency loans is sufficient to protect taxpayers from losses”? Nope. Instead, what’s going on here is that the Fed is treating the SMCCF as if it is a “business” in itself. It is then treating the corporate bonds and ETFs purchased by that vehicle as if those unsecured bonds are the “collateral.” Yes, that’s right. Uncollateralized junk bonds are being treated as their own collateral. Of course, that’s also why Section 13(2) of the Federal Reserve Act was written to prevent this sort of thing, prohibiting discounting of corporate securities “covering merely investments, or issued or drawn for the purpose of carrying or trading stocks, bonds, or other investment securities, except bonds and notes of the government of the United States.” The whole operation is a hand-waving attempt to the purchase of assets that are wholly rejected by the provisions of 13(3), and may ultimately be impossible to close without a loss to the Fed, which is a loss to the public, which is fiscal policy, which belongs to Congress, not the Fed. Again, it’s fine for the Federal Reserve to use the $75 billion of Treasury funding as “collateral“ that confers a federal guarantee on $75 billion of corporate loans and security purchases. Those funds are part of the amount that Congress, in its singular constitutional role, has allocated for public support for corporate lending. In contrast, additional purchases to “leverage” that funding are neither secured by non-financial collateral, nor have security sufficient to protect taxpayers from losses. They are illegal, both under Section 13(3) of the Federal Reserve Act, and under Section 4003(c)(3)(B) of the CARES act, which “for the avoidance of doubt” specifically invokes 13(3) “requirements relating to loan collateralization, taxpayer protection, and borrower solvency.” The newly created SMCCF is either a Ponzi scheme at public expense (if the Fed plans to allow potential portfolio losses to exceed 10%) or a 1987-style portfolio insurance scheme (if the Fed plans to liquidate securities into a falling market in order to cap its losses at 10%).
Pioneer in blockchain gaming. Currently has biggest auditory and market turnover per day. But since no new functionality has been added by developers(you could only breed, buy and sell), market is dropping prices each day. Hard to enter for newbies and earn something. On other hand has interesting science side to breed new cats. Honestly think it will be one of the longest projects, however it is hard earn there right now, HODLers very rare cats might win at the end of 2018(Gen0 cats will no appear). It is just very short description about project, more details coming soon. With current prices and price of breeding there are very little kittyfans right now
One of the most potentially best blockchain games with battle mechanic(will be working from 8th Jan but is already implemented in smart contracts) and design looks like Pokemons. Started as ponzi-like scheme, but developers turned it into amazing solution as gen0 holders which might moon just in next few weeks. Those who hadn't returned their ROI received eggs which will turn into additional gen0 mons. Moreover project leader nakasatoshi has opened weekly thread about current status and seems to be very positive and hardworking guy. Personally I'm very excited about Etheremons and waiting starting trade/lease/battle functionality. Project spend 0(ZERO) dollars on marketing and have already huge community.
Another cool projects with solid White Paper and smart contracts which will start very soon. Early adopters are already defined(1500 persons), but still project has very big potential. I'm recommending subscribe to their channels and start playing as soon as they'll start, should be very good. They have announced cooperation with Decentraland
Interesting project, will be starting very soon, now with Horses, not only siring/breeding, but competition game, where you can compete in horseracing with your own champion and win Ethers. Join now to get chance win Gen 0.
Potentially one of the hugest TCG on blockchain. They're are starting initial coin sell in couple of hours. Whitepaper looks very solid at least right now. Only one project with user agreement during buying tokens.
Don't know if it is true game, or just a gambling one, cause no rules and FAQs working on site. It seems the mechanics is as follows: you buy a fish, it stays in aquarium until some shark attacks (1 time per 24 hrs?), if your fish survives it gains additional ether in its price.
Start of project has been postponed due to developing smart contract, developers had redunf to all persons who had bought monster and didnt know about smart contract absence. Seems pretty fair. Gen0 sales will start on Jan 09
Simple collectible game, where you could buy token with your favourite celebrity (only 1 token of each celebrity exists). You're owner of token until someone decides double your price (so you'll get x2 you'd paid)
Currently only buy seeds and get flowers with certain probability: Very Common (50.9%), Common (20.5%), Uncommon (12.7%), Rare (6.4%), Very Rare(3.2%), Epic (0.8%), Legendary (0.4%), and an exceedingly exclusive Secret Tulip (0.1%)!
1st producer of digital high-end luxury vehicles on the Ethereum blockchain. Etherlambos are tokens of craftsmanship dedicated to collect the desire of people to possess unique items of value. Etherlambos can be collected, traded, and tuned. All Etherlambos come in a limited edition.
Beyond the Void is a 1v1 MOBA game with decisive features from RTS games. The gameplay is a unique mix of genres. It takes place in a universe of sci-fi and fantasy. It’s powered by blockchain as the in-game items are available to purchase only in Nexium (NXC) - the dedicated cryptocurrency. The objective is to offer a new game experience for players as they will truly own their in-game items, be able to use their cross-gaming items in feature Nexarium games and, to trade or sell them on the Beyond the Void’s shop
CryptoCelebrities - like game, at least for now. Developers promised add gaming elements and not just trading. As for now it is not recommended for newbies, as you could stuck with expensive country card
Ether Dungeon is a real ethereum blockchain based game in which players can explore the depth of dungeons, collecting & upgrading epic heroes, powerful items, challenge fierce enemies, and finally become the Dungeon Master!
ÐWorld is a game centered around owning and trading parts of the world. We call them plots. Each plot is owned by you: no one else can claim it or take it from you, unless they pay you more than you did. You can customize your plots for everyone to see.
Cryptocities - brand new blockchain game with possibility to discover new cities each 12-14 hours, and sell/rent them. Aim is to discover most valuable cities. More details could be found on site or on Discord. I like their idea and 'no rushing' cooldown before each new action. Long term project for sure
Built on Ethereum blockchain, Dragonereum is a cryptocollectible player vs. player game, allowing users to collect, breed and battle unique dragons. As for me project seems to be very promising with very cool design and idea.
Augmentors Game will be for all mobile devices when launching in Q4 2018. The game features Augmented Reality. The creatures are AR and can battle anywhere in the world. There are collectible Creature that are in limited supply as they were part of the ICO nearly a year ago. These creatures are unlike most games seen today, you can use them in real battles in real AR all over the world.
CryptoArts is a Blockchain based Virtual Gallery where players can invest into masterpieces and earn, art lovers can browse virtual gallery via mobile app in AVR. Galleries and individual artists can host exhibitions. Very ambitious and promising project. I really like and idea!
New fantasy game with RPG elements where you can battle your heroes against other players on arena or challenge on big tournament. Current prices for arena battles are high, but overall concept and design is very good
New promising and first on blockchain Football Manager. Join a team or create your own, play together with friends in the pursuit to climb the top and claim the biggest share. Train your own champions and sell them for Ether or enroll them to your own dream team!
Pandemic reborn on blockchain. Funny viruses mutation game with pyramid scheme. Create your own virus and try to infect as much as possible people. Read FAQ carefully to understand how to play properly
Etherwaifu (do not mix up with scam Ethwaifus) is fresh crafting collectible game with amazing artworks from two raising talents Jubi and Agro. Each of this fantastic artwork has thousands of unique variations, and you can craft a new one by combining traits of other artworks you own. See the magic yourself.
TDLR: Found out that my contract was paused, asked to have my BTC and told they don't have the ability to transfer it yet. BEWARE!!! Below is the transcript with the person on their chat. Karine G. Tue, 03/12/19 08:14:37 am hello , if you need help , just let me know . Me 08:14:50 am Hi Karine, why did my mining contract stop Karine G. 08:15:04 am Give me a moment Me 08:15:25 am I purchased a lifetime contract and if you are going to stop it I with to gather a refund as a breach of contract Karine G. 08:15:37 am The contract is open-ended. determined by three factors: difficulty of operation, Bitcoin exchange rates against USD and maintenance costs (which includes all electricity, cooling, development and maintenance costs). We can not control the first two factors that are unpredictable, https://nuvoo.io/ffaqs/The specific duration of a contract of indefinite duration is variable and determined by three factors: the difficulty of the exploitation, the Bitcoin exchange rates against USD and the maintenance costs of 0.00021 $ / 1gh / s of the pool 1 to 24 (This includes all costs for electricity, cooling, development and maintenance). We can not control the first two factors that are unpredictable, but we always deploy the latest mining technology, and do our best to keep them running at their peak for you. In the event that a contract becomes unprofitable (ie, the payment can not cover maintenance costs), the resulting daily payment will be nil. After that, the contract will continue for 21 days. This means that we will take care of maintenance costs in the hope that your contract becomes profitable again. This can occur if the mining network difficulty decreases and / or the Bitcoin price increases. If the contract does not return to profitability during this period, it will be completed because the extraction machines consume resources (electricity, air conditioning, accommodation, maintenance, etc.) that can not be paid with their generated payments.Malgres waiting more than 21 days your contract is not profitable income. An option will be added soon for a manual removal of your accumulated BTC. If you have questions or if you need immediate assistance, do not hesitate to contact us by chat or send us a ticket. Remaining at your disposal, Me 08:17:55 am Per the contract it stated that I would be notified prior to the closure of the contract. That I was not provided Karine G. 08:18:00 am It's ison the contract and on the terms and conditions on our website Me 08:18:00 am hence the breach of contract and now you're telling me that I am unable to remove the BTC that has been mined by my contract so you're holding it hostage? Karine G. 08:18:58 am At this time we work on the function for withdraw your accumulated the btc Me 08:19:13 am So you're holding it hostage thats theft Karine G. 08:19:24 am No We work on the function for you For all customer. The programmers work on this. Me 08:19:39 am If I cant remove it now, its theft you're holding my BTC hostage Karine G. 08:19:51 am You will be able to withdraw when the function will be ready Me 08:20:08 am I dont care that the programmers are working on it the fact that I cannot withdrawl is also a breach of contract Karine G. 08:20:10 am Sir The programmers work on the function Me 08:20:21 am That BTC is not yours do you not understand that Karine G. 08:20:36 am As long the function is not ready we cannot active this Me 08:20:39 am its is mine and if you dont give me something that is mine, its called theft Karine G. 08:21:01 am Sir As I explain you, We worked on the function for you withdraw your BTC. Me 08:21:03 am that definition is defined in all countries of the world Karine G. 08:21:18 am When the function will be ready you will be able to withdraw Me 08:21:23 am the fact that the function is not available now is theft the fact I wasnt notified of the closure of my countract is a breach of contract do you not understand how bad this would look in front of a Canadian judge Karine G. 08:22:19 am I understand sir but I can't faster the programmer because I'm not a programmer. So When the function will be work you will be able to withdraw your btc Me 08:23:22 am The fact that my contract was closed in december and its now march and this is the first I have found out about this is unacceptable I have been left thinking it was still mining that whole time. Karine G. 08:23:41 am Is on the contract and the terms and conditions For the explain of the open-ended Me 08:24:01 am I understand that but the contract also says that you would notify me of the discontinuation of the contract which you didnt Karine G. 08:24:49 am And you don't go on your account before that? I don't know why you don't received an email. Can I help you with anything else? And your contract is not ended, Ison standby for the market we analyse the market Me 08:29:04 am My contract states "The Customer shall receive Mined Parts in accordance with the Mining Power contracted and the applicable Fees" Thats directly from your contact Karine G. 08:29:19 am As I explain you We work a function to withdraw your BTC. Me 08:29:44 am by my inability to remove my parts, you are in violation of our mutually agreed contract Karine G. 08:29:49 am I don't have any date for activated the function Me 08:30:16 am "we work a function to withdraw your btc" isnt proper english I don't care that you "people" are working on it its in clear violation of my contract Karine G. 08:31:25 am We are working on the withdrawal function for your accumulated BTCs. As long as the function is not ready we can not withdraw. Programmers are working on it right now. If isn't ready I can't make more faster sorry about that and I understand your feeling. Yes in the bank if I deposit a check the bank can make a freeze on the check And I'll not have all the money Me 08:32:49 am So imagine this, you go to the bank and ask the bank to withdraw money from your account and the bank teller tells you, "sorry we dont have a function to withdraw your money." Karine G. 08:33:26 am Sir I explain you many times and is the message I received by the Senior. I can't tell you anything else. I have this information. I'm a agent not a senior or supervisor I already deposited a check and all the money was frozen Me 08:34:27 am Difference is in the blockchain its already been verified Karine G. 08:34:43 am Okay sir I just have this information Me 08:34:51 am And not my concern is if you shudder as a company, my money is gone Karine G. 08:35:01 am So I can't tell you more information. Because I don't have any other information Me 08:35:16 am So here's what you are going to do, you're going to transfer my BTC to my wallet. Why, because its already been confirmed by the blockchain as having occured Karine G. 08:35:57 am When the function will be ready we will send you your btc Me 08:36:36 am By the fact that you are hiding from that makes it appear to me that this is a ponzy scheme Karine G. 08:36:53 am Sir I don't have any other information i can give you I don'T have it Can I help you with anything else? Me 08:37:07 am And now with the siginificant drop in BTC price, you dont have the BTC sitting there that you "mined" Yes you can get me someone who will transfer my bitcoin Karine G. 08:37:28 am Sir I repeat The programmer work on the function to deposit your BTC Come back to us if you have more question, feel free to leave a comment and note our CHAT service. Good bye.
The fundamentals of bitcoin as an asset exist and they are stupider than you can imagine
tldr; tldr; Hodling is deflationary and all those wild price swings from bitcoin are changes in the fundamental value of bitcoin. Really. tldr; Imagine there is a market where $100 worth of goods are sold every day using 100 bitcoins which cycle around. Then each bitcoin would be worth $1. Now suppose that 50 of the bitcoins were being held in anticipation of growing in value so only 50 bitcoins were cycling each day. For all the goods in the market to be sold every day each bitcoin will now be worth $2. Introduction There has been a lot of discussion about what the fundamental value of bitcoin is. The consensus view in this subreddit is that the fundamental value is zero. I argue in this post that the fundamental value of bitcoin is whatever the price is right now, or a something close to it. This is because the fundamentals of bitcoin are stupid. Unimaginably stupid. Bitcoin as Currency Bitcoin is a terrible currency compared to normal statist filthy fiat. Bitcoins are often permanently lost due to hacking or easily made mistakes. Transactions take considerable time to be confirmed. The price is highly volatile. But this post isn’t going into those issues in depth. There is little evidence for mainstream Bitcoin use. A report by Morgan Stanley on the acceptance of Bitcoin from online retailers found that only 3 out of the 500 online retailers tracked accepted Bitcoin payments, a decrease from 5 in the previous year. The report concluded: “Bitcoin acceptance is virtually zero and shrinking”. The number of transaction on darknet markets is large. On darknet markets users buy illegal products using cryptocurrencies (not just Bitcoin). Due to their illegal nature, it is impossible to know the exact value of transactions that take place on them. Between February 2011 and July 2013 the darknet market Silk Road had 1,229,465 transactions comprising 9,519,644 bitcoins in revenue. Darknet markets, along with ransomware payments are the only uses where there is evidence of a substantial number of bitcoin transactions taking place. To work at scale darknet markets require cryptocurrency to pay for goods on sale. The anonymous nature of cryptocurrency allows transactions to take place without the buyer or the seller knowing anything about each other (although if a buyer has drugs mailed to them the seller will know who they are). If darknet markets used another form of payment then law enforcement could buy something and then track both the money going to the seller and the commission paid to the darknet market. It isn’t true as many people have claimed that nothing backs bitcoin. Bitcoin is backed by darknet markets. There are a few kinds of people who buy bitcoin and want to spend it. They include drug buyers, those who need to pay off ransomware, money launders, fraudsters, and a few others but for simplicity’s sake I will just call them drug buyers. Likewise, there are a few types of people who sell products for bitcoin but again for simplicity’s sake I will call them drug sellers. Non-circularity Bitcoin is a currency with a property that I call non-circularity. With Actual Money, when I buy something in a shop, the money I paid with goes towards the wages of the staff, rent and the products themselves among other expenses. This money then flows on to others. When a drug seller receives bitcoin in exchange for their drugs they can’t use the bitcoin to pay for their groceries or to pay their rent. They must exchange the bitcoin for filthy fiat to buy food. The inability to use bitcoin for further purchases means it is a non-circular currency. Bitcoin is a medium of a medium of exchange. A full bitcoin transaction thus consists of three parts:
A drug buyer goes to a bitcoin exchange to get bitcoin in exchange for filthy fiat
The drug buyer goes to the DNM to exchange bitcoin for drugs from the drug seller
The drug seller goes to the bitcoin exchange to get filthy fiat in exchange for bitcoin
An exchange is any place which matches buyers and sellers of bitcoin. This includes online exchanges like Coinbase as well as LocalBitcoins which matches people for face to face transactions. As nobody receives bitcoin for payment except drug dealers, the only place for drug buyers to get bitcoin is an exchange. The extreme volatility of bitcoin means that drug buyers and sellers try to complete the process as quickly as possible and avoid holding onto bitcoin. Perfect Price Unstickiness For normal currencies prices are sticky. That means that nominal prices do not respond quickly to changing economic conditions. In contrast bitcoin has what I call perfect price unstickiness so the price of goods in bitcoin changes almost perfectly to changes in the value of bitcoin. This is because prices for items which can be bought with bitcoin are never actually set in bitcoin, probably due to the high volatility. Instead they are set in fiat. The amount in fiat can either be listed directly, so $US50 for these drugs, or the price can be listed in the converted amount of bitcoin, 0.005BTC if 1 BTC = $US10,000. Changes in the price of bitcoin on exchanges are instantly reflected in the prices of drugs in bitcoins on darknet markets. Hodling Another feature of bitcoin that should be considered is that people hodl bitcoin. The word comes from a typo of ‘hold’. Bitcoin is often bought on exchanges not for use as a currency to buy drugs, but as an asset in expectation of a price rise. Hodlers are the third type of user of bitcoin along with drug buyers and drug sellers. Although they don’t use it. What’s the difference between an asset that is held and one that is hodled? This is admittedly vague, but an asset is hodled if it is being held, it can be held for long periods at low costs, it can but isn’t generating any income and there are no plans to generate income from it soon. Cash under the mattress is being hodled, cash in my wallet that I am going to buy stuff with soon is not. Money in my bank account is generating income and so is not hodled. Bitcoin held in anticipation of price rises is being hodled. Bitcoin bought to buy drugs but which has not been used yet is not. Gold stored in a vault is being hodled, gold used for electronics purposes is not (jewellery is a harder case). A vacant block of land with no plans to develop it or use it for anything is being hodled but one that is soon going to have an apartment block built on it is not. Commodities can be held and do not generate income until sold but it is expensive to hold most commodities for long periods of time. This prevents most commodities from being hodled. Velocity The velocity of money is the average number of times a unit of fiat changes hands in a period. You can skip the next three paragraphs as they are a little annoying and you can get by without them. Just know that I am defining the velocity of bitcoin as what the velocity of bitcoin would be if no bitcoin was being hodled. Due to hodling, the velocity of bitcoin under the conventional definition can vary wildly. Consider two cases. Both have 100 bitcoins, 100 transactions a day and all non-hodled bitcoins are spent each day. The first has no hodled bitcoins, the second 50 hodled bitcoins. The first has a velocity of bitcoin of 1 transaction per day, the second is 0.5 per day. I want a definition of velocity of bitcoin that is not impacted by changes in hodling. I did consider doing this analysis through changes in velocity but the final formula is easier to understand if we find a definition of velocity of bitcoin that is independent of the level of hodling. The definition that achieves this is (Length of Time)/(Average length of time to complete transaction). When there is no hodling the two definitions agree but the new definition is unchanged by any rise or fall in the level of hodling, which is what we need. From this point on when I refer to the velocity of bitcoin I am referring to the second definition. The actual time to complete a bitcoin transaction seems to be over a week. In an interview one vendor claimed that it took one week for the bitcoin to be released from escrow and longer to convert it to actual money. Intuitive argument Assume that the amount of drugs sold on darknet markets changes little from week to week. If the price of bitcoin doubles over the week then the number of bitcoins flowing through the darknet markets will halve. So where have the bitcoins gone? Drug buyers and sellers don’t have them. The only option is hodlers. In fact, it was the hodlers buying the bitcoins that caused the price to change. Formula The conventional formula for the relationship between velocity of money (V), nominal amount of money (M), price level (P) and real economic activity (Q) is V*M = P*Q I am going to change that equation slightly so it now concerns the velocity of bitcoin (V), the total number of bitcoins (M), the price level of bitcoin (P), the total value in fiat of all economic transactions (Q) and the proportion of bitcoins that are hodled (h). If h*M bitcoins are being hodled then there are (1-h)*M bitcoins being used in economic transactions. The new equation is V*(1-h)*M = P*Q Next we isolate P: P = V*(1-h)*M/Q If the price level changes from 1 to 1.1 that means that there has been 10% inflation over the period and that the value of bitcoin has fallen. To find the value of a single bitcoin we have to take the reciprocal of P and that gives a formula for the true value of bitcoin: 1/P = Q/[V*(1-h)*M] In the rest of the post when I write the price of bitcoin I mean the price bitcoin sells for on exchanges. I establish in the next section that this price must be close to the true value of bitcoin. Equilibrium This section uses the flow of bitcoin model established earlier. We assume no activity from hodlers and that economic users do not hodl bitcoin (not true but it simplifies and does not hurt the model). Furthermore, we assume that all activity on the bitcoin exchanges happens, then all activity on the darknet markets happens. Drug sellers sell their bitcoin to drug buyers, then drug buyers use the bitcoin to buy drugs on the darknet markets. Neither the exchanges or the darknet markets charge commissions. I use specific numbers but my reasoning is easily generalizable. To establish why the equation is true we must consider what happens if the actual price is higher or lower than the price given by the formula. First let us suppose that the price is lower than the price predicted by the formula. Over the time period of a day suppose that Q = 100 (so $100 worth of transactions a day), V = 1 (transactions take a day), M = 100 (100 bitcoins) and h = 0.5 (50 bitcoins are hodled). This gives a predicted price of $2. Suppose the price is instead $1. Every day there are $100 worth of drugs available to be sold and buyers willing to buy $100 worth of drugs. At a price of $1 and with only 50 bitcoins available for economic use each day that means that only $50 worth of drugs can be sold. This would drop Q to 50 and immediately correct the equation. However, there are buyers and sellers who want more drug dealing than that. Some buyers are not going to be able to get their drugs given the current price. Some of them will be willing to pay higher prices for bitcoin to guarantee they can have their drugs. Suppose that the drug sellers have 50 bitcoins (hodlers also have 50). They want to sell their 50 bitcoins to drug buyers on an exchange. Some drug buyers then bid the price of bitcoin up to $1.10 (for example). This benefits other drug buyers as now $55 worth of drug transactions can take place each day. In this way, the price will be bid up to $2, the equilibrium price. If the price is $1 and the drug buyers have the 50 bitcoins then they will spend the bitcoins to buy $50 worth of drugs and then we are in the situation above. Now suppose the reverse happens and the actual price is higher than the predicted price. Let the actual price be $4, with all the same example values from the previous example, so the predicted price is $2. On the exchange drug sellers have 50 bitcoins worth $200 to sell. Drug buyers want to buy $100 worth of bitcoin. At this price only 25 bitcoins are sold. To ensure they sell more of their bitcoin, drug buyers bid down the price. If the price does not immediately reach $2 then the left-over bitcoins will be held by the drug sellers until the next day when the price will be bid down again. The drug sellers holding bitcoin for a few extra days is not the same as hodling because they are actively trying to sell them on an exchange but they haven’t because the price isn’t in equilibrium. They could instead decide to sell only 25 bitcoins and hodl the other 25. This would raise h to 0.75 and the price would be in equilibrium again. Now suppose that the drug buyers have 50 bitcoins and the price is $4. Then $100 worth of drugs are bought with 25 bitcoins. The drug sellers will not be able to sell their bitcoin as drug buyers already have enough bitcoin to buy the next round of drugs they want. The drug buyers spend their last 25 bitcoin and drug sellers now have 50 bitcoins and the situation is as above. In conclusion, the price of Bitcoin is fundamentally determined by speculators and brought into equilibrium by criminals. Inflows and Outflows of Hodling The previous section treated the level of hodling as constant, except when drug buyers or sellers decide to hodl extra bitcoins that are in their possession. Now we will treat the amount of hodled bitcoins as changing. The next topic to consider is the relationship between filthy fiat spent to hodl bitcoins and the bitcoin price. To calculate how much it costs to raise the hodl ratio from 0 to h we assume that the bitcoins are bought continuously. We integrate the function Q/[M*V*(1-t/M)] between 0 and h*M. The result is (Q/V)ln[1/(1-h)]. To double the price of bitcoin by taking h from 0 to 0.5 will cost (Q/V)ln(2). In fact, it will always cost this amount to double the price of bitcoin as we can see by finding the difference between the total value of hodled bitcoin when we consider hodling levels of h and (h+1)/2. This means that the price of bitcoin rises exponentially when a constant amount of new money buys bitcoin to hodl. I would illustrate this with a log-scale graph but I don’t know where to find one. It also means that the market capitalisation of a cryptocurrency gives very little idea about how much the cryptocurrency is worth. It is an impossibility for all hodlers to receive the Actual Money that they think their bitcoin is worth. Volatility People hoping to get rich and their buying and selling bitcoin is what causes bitcoin’s extreme volatility. Theoretically this could be stopped if there was a bank where hodlers could deposit their bitcoins and earn interest. However, for this to work would require the existence of a bitcoin bank which is not a Ponzi which seems like an unlikely outcome. Hodling Gold A quick digression into gold, but I suspect someone has already thought of what follows. We can consider gold like a conventional commodity with conventional supply and demand curves (the real world for all commodities is more complicated but this is going to be quick). But people also hodl gold. If hodlers decide to buy $100 million worth of gold produced in the year, then that will change the equilibrium price. The new price is such that the difference between the quantity demanded by non-hodlers and the quantity supplied at that price multiplied by the price is 100 million. If the overall level of hodling declines then the reverse happens. The hodlers sell an amount of gold, that amount is the difference between the amount supplied and demanded. The hodlers earn that amount multiplied by the new lower price. (I assumed people bought a fiat amount of gold and sold a volume of gold to make things easier). Without another hodler to take on the gold or an improvement in market conditions, the hodlers are guaranteed a loss. To make a profit hodling gold you need there to be hodlers to sell it on to (or an improvement in the underlying factors). It follows that all the gold hodled in the world today cannot be sold without causing the fundamentals of gold to collapse. With 40% of the gold produced in 2017 being hodled this will eventually become a significant issue. Full Reserve Banking Another place where we can consider the impact of hodling is full reserve banking. It is a form of banking where banks are required to have cash on hand equal to the full amount in all demand deposit accounts. The bank does not lend this money. This contrasts with the present system where banks are only required to have a certain fraction of this amount on hand, called fractional reserve banking. Money in a fractional reserve bank account is not being hodled (or is, but to a more limited degree) as it is being lent on to other people and it is generating income for the depositor. Deposits under full reserve banking are hodling. They are like cash stuffed under a mattress but have better security. In a recession people increase their saving rates. Much of this additional saving will be in liquid assets because of fears of economic trouble. This rise in deposits under full reserve is an increase in hodled cash which then causes deflation. This is a big problem in a recession. (Somebody else has probably already made this observation). Velocity and Value Consider the equation of bitcoin’s value again. Notice that the value increases when V decreases. Which means that the length of time to complete a transaction has increased. Bitcoin is an asset and a currency and its value as an asset increases as the length of time it takes to complete a transaction increases. This is a minor bit of stupidity which surprised me but seems obvious in retrospect as if bitcoins take longer to be processed then they must be worth more so that all transactions can happen. (This is assuming that a decrease in V does not also cause a decrease in Q which might be caused by drug buyers and sellers switching to a different cryptocurrency). Hodler Behavior With one exception which I might make in another post I make no assumptions about hodler behaviour. I think they are buying and selling with no rational basis. But there are two rational reasons why someone would expect the price of bitcoin to rise: increased economic activity using the cryptocurrency in the darknet markets or an increased level of hodling in the future. The DNM is an actual economic activity but due to its illegality knowing anything about the amounts involved is impossible for almost everyone as is predicting their trends. Future hodling levels are also impossible to predict, unless you run a pump and dump. We can’t expect any sort of rational behavior from hodlers. Nakamoto Scheme Preston Byrne developed the concept of a Nakamoto Scheme to describe cryptocurrencies because of how they differed from Ponzis and pyramid schemes. While bitcoin has been frequently called a Ponzi or pyramid scheme it is clearly something different. There are no “dividends” paid or any sort of organised structure. There are similarities, notably early adopters make their money at the expense of later adopters. Like in pyramid schemes hodlers try to convince new people to join in. It is best to consider bitcoin as a type of asset which is uniquely suited for a pump and dump. When hodlers buy bitcoin, and encourage others to do the same (the pump) the fundamental price of bitcoin really is raised by these actions which helps the pump. To add to Byrne’s work, we should put the properties of cryptocurrency assets at the centre of the scheme. A Nakamoto scheme works like this: first create a cryptocurrency and keep most of it for yourself. Then release it and try to get as many other people hodling as possible and try to get the darknet markets to adopt it (I’m looking at you Monero). This increases the fundamental value of the asset. Then dump your hodlings. Pocket the actual money. This is probably legal right now. But I’m not a law-knowing person. For the hodler the Nakamoto scheme is like going to a party. You arrive and leave later on. If there are more people at the party when you leave compared to when you arrived then you’ve made a profit. There is also drug dealing going on at the party. The change in the level of drug dealing also impacts your profits. You have to try and get more people to come to the party and be careful of everyone else at the party who have the exact same incentives as you. It is a weird new form of scam. Lower bound on price While the price of bitcoin can theoretically be infinitely high there is a lower bound on the price when the hodling ratio is zero. For given levels of Q, V and M the value of bitcoin can never go below Q/[V*M] (the highest possible price for bitcoin is when 1 satoshi is equal to the value of a transaction). Some bitcoins have been permanently lost due to people losing their wallet keys or bitcoins being sent to the wrong address. If we suppose that H is the proportion of coins that have been permanently lost then the actual lower bound is Q/[V*(1-H)*M]. Note that a hodler losing their coins does not change the present fundamental value of bitcoin. What could cause bitcoin’s price to go lower? Besides a mass hodler sell-off the obvious reason is a permanent decline in Q. What could cause this? Law enforcement have successfully shut down many darknet markets but others have replaced them quickly. What could really hurt darknet markets is increased government scrutiny of exchanges. When governments realise that bitcoin has no use beyond criminal transactions and speculation they might decide to treat every bitcoin transaction as inherently suspicious and regulate exchanges heavily. This will make bitcoin much harder to use for criminal transactions and thus greatly decrease Q and the value of bitcoin. Previous work This post is not entirely original. Satoshi himself said that if a bitcoin user wanted to give a donation to everyone else then they should delete the keys to their wallet and increase the value of everybody else’s bitcoins. I realised that someone who hodled a bitcoin would temporarily have the same effect. More significantly Joseph C Wang came up with a formula very similar to mine. A significant difference is that he thought increased economic activity with bitcoin would not cause an increase in bitcoin’s value but an increase in its velocity. My model has nominal prices of drugs in bitcoin falling when Q increases. Wang has prices remaining the same and the velocity of bitcoin increasing to handle the extra transactions. I developed my formula before I became aware of Wang’s work. Further Topics This post is over 4000 words so I have not gone into depth on a few subjects like the costs of block rewards (higher than you think), shocks like darknet market shutdowns, why bitcoin can’t fall to a liquidity trap, how to value a cryptocurrency that isn’t being used for economic transactions and why it makes sense that bitcoin and bcash had a higher combined value at the time of the fork compared to bitcoin alone. If there is demand I’ll put together a second post which will cover these issues.
I first got interested in cryptocurrencies during the last bubble in late 2013. I bought in to the hype, bought some coins for cash, started trading, made some profit, made some losses, and ended up disillusioned when the bubble had finally popped and I was in the red. I put up a few sell orders and just waited until it would either die for good or come back alive like it has done now. But what I saw then is repeating itself now, although in a slightly different shape. Back then people would create coins with new features such as proof of stake, new hashing algorithms that would be ASIC proof, some of them actually created coins that had some real life use like Monero and Darkcoin, or Dash as it's called now. But most of them were shitcoins only made for pump and dump purposes. The new craze is ethereum based coins. Everyone and their uncle are making ICOs with the new best platform for a new revolutionary pointless purpose that makes no sense. Just like the shitcoins of 2013/2014 had pointless features that sounded cool but were pure fluff to make people horny enough to lose their minds and buy in to the hype so the creator could cash out a hefty bitcoin profit, leaving the bagholders wondering what the hell just happened. It's repeating itself this time too. I see people acting in the same nutty way that they did back then. Is this coin good? What should I invest in? What's the best coin and why is it $hit€oin? When will $shit€oin reach the moon? Quick, everyone buy this €rap€oin, it's going to the moon! And so on, the trollbox is live and thriving everywhere you turn. Some are honestly asking, others are shilling, some are bots or fake accounts replying and saying they love the €oin because it has a revolutionary but pointless feature that everyone will never care about. You can also compare it to the Dot-com bubble where companies were started, venture capitalists poured their millions into ideas that sounded good on paper but no one knew how to do. But the hype was real, just look at where we are today, the internet is bigger than anyone could believe back then. I think crypto currencies are the future just like the internet turned out to be, but it's the wild wild west right now. And don't get me wrong, I'm not asking for state regulation, it's inevitable either way, but I'd rather have it like this, decentralized, unpredictable, exciting and fascinating. But just remember that those of you who are just getting in to this, you are repeating the same mistakes that I and many others did in 2013/2014. You are the new cows that the whales are milking, you are the naive ones who're trying to make a quick buck by buying shitcoins, believing in ICOs and so on. Some of you will get it right, many out of pure luck, and a select few are able to see past the noise of the scams, ponzi schemes and outright frauds. I'm not saying I'm one of them, absolutely not, I just know that the previous bubble had the same pattern, but this time more people are aware and more cash is flowing in. Don't take advice from Reddit. You can't trust anyone here. Assume that everything you read is a scam. The chance of it being legit is minuscule, I just refreshed coinmarketcap.com to copy/paste the number of listed coins, it was 837 before I refreshed and 840 after I refreshed. Do you see my point here? How many new coins are created per month? How many of the 840 listed coins are useful today? 5? 10? 20? 50? It's hard to define what useful is, but the vast majority of them are absolute trash. Don't be a sheep, don't trust what a stranger online said about a coin, don't trust blogs, websites and youtubers who talk about the next big €oin that will make you fly on your personal NASA built rocket to the moon once you've staked 50 of them for a month. But that's not to say that you shouldn't gamble, that's what we're here for, right? But don't trust their promises of some new magical properties that will revolutionize how dairy farmers trade the tons of methane that their cows produce. And yes, cows produce methane, but no, there's no coin that's trying to capitalize on that market. Yet? How about naming it ƒartcoin? I claim 10% of the premine if someone creates it. You heard it here first people. If you've made it this far, keep in mind that the smaller coins that increase in value by e.g 200% in two weeks time most likely have no significant market cap, so if you try to sell a couple of bitcoins worth of coins, you might tank the price, so smaller coins are useless for any significant sums of money. But they're perfect for gambling purposes. Just remember that they're just that, shitcoins that you should get rid of as soon as possible. And don't take my advice, make an informed decision, I might be trying to fuck you over ( ͡° ͜ʖ ͡°)
I've been lurking this sub for a while because I like a bit of scepticism, which I feel is a good balance to the insane optimism in pretty much every other crypto sub. I know that you guys generally believe that blockchain is useless and that every potential use case that is being suggested can be done better with a centralised database, or that when it comes to scaling, the speed and amount of transactions that can be completed per second makes crypto effectively useless as a method of payment. I would say that, although I agree with a lot of what is said; it has been 10 years since Bitcoin and blockchain were created and as of yet there are still no real world applications for the technology that is more efficient or an improvement upon an already existing system, the market being overvalued and inflated with money "invested" by people who are only interested in getting rich quick, with no real way of valuing any kind of coin or token, effectively making them worthless, I still believe that more recently there have been projects that are starting to offer applications and solutions to real world problems, or at least interesting potential alternatives. The reason I'm posting is just to see the perspective of this sub on tokens such as BAT and Funfair or Decision Token, where the tokens have a clear, defined purpose and are trying to solve clear issues within the respective fields they are trying to enter. If you think these are bad examples, please tell me why, I'm not going to be offended or try to defend any of these projects, I just want to know if there is any single project that anyone here considers to actually be viable and not just a ponzi scheme.
05-09 12:33 - 'Lol @50k. You see this is the ponzi scheme. You are sure it will get over. Now is that a fraud? No. But as long as you are willing to invest to get more out of it based only on assurance of others - that is the definition...' by /u/ssssigismund removed from /r/Bitcoin within 94-104min
''' Lol @50k. You see this is the ponzi scheme. You are sure it will get over. Now is that a fraud? No. But as long as you are willing to invest to get more out of it based only on assurance of others - that is the definition of ponzi. And the only ones that actually profit are the early investors. There is no contract but the scheme itself is a ponzi one. You buy in to get profitt and it only increases in profit if others buy in. When you deal with oil there is the inherit value of oil that drives the prices and is only partially defined by investors. Here it is not so ''' Context Link Go1dfish undelete link unreddit undelete link Author: ssssigismund
Hello! My name is Kristina Semenova, I am the Head of Investors Relation Department at Platinum, the world’s number one business facilitator. Our team knows how to start ICO/STO in 2019! Why are we so sure? Well, our experience speaks for itself: Platinum.fund But what is the difference between ico and sto? What is the cornerstone of ICO marketing strategy? You will know this after finishing the UBAI courses! Here’s just a quick preview of our Short Course lesson. Real World Examples Multinational accounting firm Ernst and Young found that $400 million of the $3.7 billion USD raised from ICOs (as of January 22, 2018) had been stolen. That is, up to 10% of all ICO funding is virtually being stolen from investors. Though ICO scams are the most common method of theft in the crypto world, some projects will actually operate for a period of time before disappearing with the money. Like in a Ponzi scheme, an exit scam may be planned for later, sometime after a manipulated pump; or some other time the team believes is most opportune to take the money and run. Giza: Giza marketed itself as a platform within which different cryptocurrencies could be stored securely. But after raising $2.4 million in one month, the team deleted the website and stopped replying to emails. Investors were duped by a very convincing whitepaper, and actors had been hired to appear in photographs promoting the project. No investor funds have ever been recovered. Centra: The SEC put an end to fundraising for the Centra ICO and charged the founders Robert Farkas and Sohrab Sharma with orchestrating a fraudulent ICO after they raised $32 million USD. They were promoting the ability to develop financial products backed by VISA and Mastercard, though it was later found that neither partnership was real. One of the major red flags in the Centra project was the use of celebrity endorsements for publicity, reportedly paying champion boxer Floyd Mayweather a significant sum to promote their project. Who wants to leave their Blockchain investment decisions up to Floyd Mayweather, regardless of his unbelievable skill as a boxer and regardless of his own financial success? He should still not influence where you invest your money! Ponzi Schemes: Bitconnect: This is the most infamous Ponzi scheme in the history of cryptocurrency, and certainly the most damaging. Bitconnect was a Bitcoin-based project that rose to an all-time high of $463 per token on the back of a fictitious trading bot. The Bitconnect scam operated by paying dividends to users, proportional to the number of tokens they held and the number of referrals they made. The BCC tokens were exchanged for the users’ Bitcoin, and the highly sophisticated and wildly successful trading bot would trade BTC for them and distribute profits as dividends. The value of the dividends offered was approximately 1% of the initial investment per day. In other words, that is approximately 3,780% per year in cumulative gain! The referral system was capitalized upon most heavily by many of the biggest crypto YouTube channels, including CryptoNick and Trevon James, both of whom are now under investigation by the Federal Bureau of Investigation. Shortly after the Bitconnect Token reached its all-time high, they received cease and desist orders from the security regulators of Texas and North Carolina, which caused the owners of the Bitconnect exchange to shut down operations, and the price to plummet. Davorcoin: Davorcoin was a lending platform very similar to Bitconnect. And Davorcoin was farcically promoted by the same Trevon James crypto Youtuber who promoted Bitconnect, and is currently under investigation by the FBI for promoting Ponzi schemes. The Texas State Securities Board, in likening Davor to Bitconnect, stated that “DavorCoin is telling investors they can earn lucrative profits by investing in a lending program based on a new cryptocurrency known as davorcoin. Investors allegedly purchase davorcoin and then lend it to DavorCoin”. Davorcoin promptly plunged from an all-time high of $180 to very close to zero after a cease and desist order was made against them on the 2nd of February 2018. Useless Ethereum Token: Despite brazenly stating in the name of the project that the token has no use, the UET managed to raise $340,000 in its crowdsale, and saw a significant pump of over 300% on the HitBTC exchange in February of 2018. The scam was an obvious case of pump and dump, with the total trading volume for UET crashing back down to as low as $3 per day, after reaching as high as $350,000 per day during the pump. It is currently an unfortunate consequence of the decentralized nature of cryptocurrency, but there is a distinct lack of recourse for scammed investors. It is wise to become as well-acquainted with the various indicators of good and bad ICOs as you possibly can. In weighing the factors that will allow you to avoid expensive mistakes, ask yourself in whose favor are the terms of the ICO slanted, yours or the teams? To what extent are you actually likely to profit from this investment? Cryptocurrency is inherently a grey area, whether you are investing in it or not. Investing is another inherently grey area, no matter what the area or object of investing might be. Laws and regulations are not always able to keep up. Trying to define and prove what was or was not a scam is not likely to be as simple as the scammed investor would want it to be. A project can be set up in certain ways to avoid being technically classified or provable as a scam, but the unprepared investor can still be burnt or scammed just as badly. Now we look at more individual indicators that can help you form a valid impression whether or not an ICO or even a fully-fledged exchange-listed coin is a scam or a bona fide investment opportunity. Common Signposts Contrasting Scam & Legitimate Projects Presale Bonus/Token Release If the ICO allots massive bonuses to team members, you may leave yourself open to getting dumped on by presale investors if you buy when the project tokens are listed on an exchange. Likewise, if the project has a short lock-up period for developers and founders, you run the risk of them selling as soon as the token is listed on a major exchange. The token release schedule for the founders of a worthwhile project should show long-term team commitment to that project. The Jibrel Network team tokens will be locked up for 5 years before release, and they had no early investor bonus in the main sale. Both of these factors instilled confidence in the JNT ICO investors, and the tokens were sold out weeks before the ICO was due to end. No Presale lock up If Presale investor tokens are not locked up at all for any period after listing, that could easily be a set up for an exit scam after the initial listing. No presale lockup for early investor tokens is a crystal clear warning, the project may be fatally rigged toward those in the inner circle, with little commitment to the long term health or success of that project. Unsolicited Offers or Unasked for Additions to Groups Characters running scam projects will often add you to Telegram groups out of the blue or send you unsolicited emails with information about their project. Telegram is the most widely used messaging app in the cryptocurrency community and you should familiarize yourself with it to keep yourself in the loop for specific projects in which you invest as well as all kinds of other relevant crypto info. You can adjust the settings on the Telegram app to disallow anonymous additions to cryptocurrency projects if you find yourself bombarded with offers by scammers. Reputable projects at the ICO stage will spread by word of mouth, or by eloquent and meaningful articles posted on their Medium page. A project with serious potential does not need to actively seek participants for their ICO like that. They will often be able to fill their ICO hard cap in a matter of hours, or even just minutes! Anonymous Team Alarm bells, again, immediately, if the project has minimal online presence. The individual team members could be mere fabrications. The entire project could be a farce by utterly inexperienced characters. What if the project leaders are simply unaware of the importance of a strong social media profile? That in itself would be too strange to ignore. Top-level projects will have team members with experience in crypto and the LinkedIn accounts for those members will be easily accessible right there on the project website. You should be able to easily see and evaluate each individual’s experience in their field and ascertain what they bring to the project team. Bitconnect’s anonymous team should have been the only deterrent prospective investors needed to discourage them from putting money into that doomed project. Ethhorse, a current project with anonymous founders and operators should be steered clear of at all costs for the same reasons. Community Atmosphere The subreddits or Telegram groups of scam projects will often feature moderators that do not allow any kind of criticism in the group chat. If, in the process of your due diligence, you encounter didactic admins that only wish to silence your questioning of certain aspects of the whitepaper or mechanism of the tokenomics , you should be concerned. Similarly if you see a coherent critical reply attacked by many different users who refuse to engage the substance of the point being made, that may be a subreddit infested with bots. Projects that have nothing to hide will allow free debate in the chat. Ideally, they hope to develop a positive community that is itself an asset to the long-term success and overall strength of the project. Good projects do not need to automatically brand all criticism as Fear Uncertainty and Doubt (FUD). Whitepaper One common tactic of scammers is to produce a whitepaper that uses too many buzzwords, and deliberately obfuscates and overcomplicates the explanation of the problem and/or its solution. A good whitepaper clearly and concisely lays out the problem and answer, as well as provides compelling arguments why a Blockchain solution is preferable to the current solution. Another point of concern is a whitepaper that gives unrealistic time frames and goals. Bitconnect’s almost comically optimistic profit projections are a prime example of this, as are the 1,354% yearly gains promised by Plexcoin. Respectable projects will set out development timescales in terms of quarters or years, rather than offering immediate profit projections, which are simply a red flag. Advisors/Connections in the Cryptoworld The most prestigious projects will already have partnerships made before the ICO stage, and the worst ones, i.e. the scams, will not mention any such partnerships. Icon (ICX) for example was spawned from a South Korean project named The Loop, a collaboration between 3 Korean universities and the DAYLIFinancial Group. They boasted an advisory panel consisting of the legendary investor Don Tapscott, Jehan Chu and crowdfunding expert Jason Best. On top of a solid team of advisors, good projects will also be visible at major Blockchain events such as the Consensus, and the World Blockchain Forum, etc. Scam projects will be unable to inspire this same level in confidence. As an investor, you should sense a certain presence and expect a certain feeling of trust that should guide you in your investments. After all, it is actually a people-to-people thing you are doing. Key Stress points upon the Timeline to Identify Scam Projects Post Whitepaper Release The period in the immediate aftermath of the release of the whitepaper can also be decisive in establishing the validity of a project. How a team copes with the roadmap that they have laid out for themselves is key. Valuable insight into the operational efficiency and commitment to the project can be gleaned from the quality of and amount of code committed to GitHub. If you have any experience in computer programming you can see how clean and orderly the code is, which gives insight into the skill of the developers, and in turn the quality of project leaders’ decision-making in hiring team members. Scam projects will have little or no code committed to GitHub, or at best it will be copied and pasted from other projects just to cover their tracks. Start of ICO Sometimes, a scam project, or other project in which you would be better off not investing, will change the terms of the ICO just before the ICO starts. The Key (TKY) ICO doubled the price of tokens on the day before the ICO was due to take place, because the price of NEO had risen so drastically. Currently, the TKY token price is still only half of its ICO price. Initial investors are faced with the prospect of a 50% loss on their investment. Exchange Listing Some particularly greedy scammers will create a scam project with the intent of selling tokens in the ICO for BTC and ETH, and then pumping and dumping their share of the tokens immediately after listing. The team of fraudsters behind Monero Gold used this method after the crowdfunding of their useless ERC-20 token. After listing on CoinExchange.io, the team dumped their tokens until the exchange finally ceased trading. Although it is not uncommon for ICO tokens to sold after listing (just like can happen with shares of stock after an IPO), if the price does not stabilize and massive sell walls are continually placed, a scam is likely taking place and the token is being dumped. Fake Ethereum Twitter giveaway You may have noticed Ethereum creator Vitalik Buterin’s twitter handle has been changed to Vitalik “Not giving away Eth” Buterin in recent months. This is because a group of devious scammers had created fake accounts with almost exact replicas of his profile (deviating by only one character). The fake accounts promised to deposit 1 whole ETH for every 0.1 ETH the potential sucker deposited into the wallet address provided by the scammer. These fake account “Ether giveaway” scam tweets were set up to be sent in just a matter of seconds after the real person tweeted, and usually always appear immediately after the tweet of the real public figure. Fake bot profiles then came into play, thanking the fake Vitalik, or fake Elon Musk, for holding up their end of the bargain and depositing the ETH as promised. One scammer, or group of scammers, managed to fill a wallet up with almost $20 thousand worth of ETH, which they transferred out, never to be seen or heard from again. Effect of Scam Customers, Upon the Affected Parties Of course, this is no fun for the targeted public figure either. They need to take steps to avoid being targeted again. This will mean changing their handle, their username, or making their accounts private. However, the injured party with whom we are most concerned is the unfortunate scammed social media user, who has no chance whatsoever of getting his or her funds back, ever. It is a harsh lesson to learn. But it is a fact of crypto reality. Nearly every one that trades crypto will at least be exposed to frauds or scams in one way or another. In this case, we think it is better to learn about scams by studying them, rather than learn from your own unfortunate and expensive experience. In the case of Mr. Buterin, these incidents were awful public relations for the Ethereum project. It had only been a few years since cryptocurrency as a whole was primarily associated with criminality and seedy transactions on the Darkweb. Any connection with unscrupulous behavior is best avoided at all costs. Negative associations could have been particularly damaging for Ethereum’s brand because the vast majority of ICO fraud is committed using the ERC-20 token as the template for the scam tokens. Any and all the scamming or fraudulent behavior in the cryptocurrency ecosystem is bound to have a negative impact on the speed at which mainstream uptake finally takes place. Cryptocurrencies, as an emerging asset class, will be painted in the worst possible light. Crypto is aiming to, and is in fact in the process of, causing great disruption in traditional centralized finance and business. Mainstream media organizations are also part of that traditional centralized economy. Press coverage will be damning. Something is happening here, but Mr. Jones doesn’t know what it is. Legal Recourse for Scams We clearly understand, there is a possibility of being scammed. We know the scams are happening. The SEC has made some arrests and actually charged people for operating fraudulent ICOs. But it is a struggle to deal with the flood of ICOs coming from anywhere at any time. The SEC filed charges against two founders of a purported financial services startup for orchestrating a fraudulent ICO that raised more than $32million from thousands of investors. As you know from the ICOs we have covered so far, the lack of regulation allows for direct contact and dealing between the entrepreneurs, business owners and potential investors. While we believe this is a blessing according to the founding principles of Bitcoin and other alternate Cryptocurrencies, because it frees us from traditional roadblocks, middle-men, and all kinds of time-consuming procedures; it also leaves investors in a place where there is often little to no hope of ever recovering funds lost in fraudulent schemes. Actions after a Successful ICO Good post-ICO practice is characterized by stringent security, well thought-out legal strategy and clear communication. Many projects have paid the price in damage to their reputation for failing to adequately guard customer information, leaving themselves open to phishing attacks by fraudsters. Investors in the Enigma project had half a million dollars stolen from them; and a whopping $8.4 million was defrauded from investors in Veritaseum via phishing attacks. After a successful token distribution, the team’s main focus is initially on switching the enterprise from one primarily focused on fundraising, to superficially at least, a fully-fledged, functioning business. This involves removing most of the token sale-related content from their main webpage, sending newsletters to all successful ICO participants, and sending refunds to those who may have missed the deadline or the hardcap. Then, with the stressful and complicated fundraising stage finally concluded, a portion of the funds raised can be assigned to fuel the growth of the project community. This can involve hiring community managers, forum admins, and social media managers to outsource the job of keeping investors in the loop. The founders can focus on growth strategy and product development. The cultivation of a thriving and energetic community is extremely important. The community will give you free marketing for your product and your business. Community members who believe in the project, and are engaged by professional moderators, can give you very effective promotion to other prospective investors. Communication with community members is a great way to test ideas and gauge sentiment related to various aspects of your project. The project leads must set aside adequate funds for lawyers. The project will need to address potential future or imminent problems with regulators, at the very least. The transition from fundraising project to full-fledged business can be incredibly challenging, and even more stressful than the ICO itself. The main thing to remember is that your pre-sale and ICO investors are not just silent investors waiting for a return. They are the early adopters of your solution, of your product; they are the community and promoters of your project; and they are the individuals with a vested interest in the financial success of your venture. The ICO environment is not as heavily regulated, so quarterly and/or semi-annual reporting is not required the way it is in the traditional world. That means your own style of effective communication about the progress and key developments on your project matters even more. In the ICO world, you communicate with your press releases, social media, and Medium posts. You also communicate by the very nature of your relations with your exchange, and relationships with your cornerstone investors. Effective communication and good business relationships can play a prominent role in the success or failure of your venture (by token liquidity and valuation). If your investors start to lose interest, and stop trading your token on the exchange, liquidity will dry up and cause increasingly volatile price swings. You need to keep certain things in mind, and follow effective practices to maintain a happy and motivated community. Social Media & Medium In addition to your website, your social media & Medium blog most likely formed a significant part of your ICO preparations. Your purpose pivots after the ICO from one of promotion to one of communication. Consistent, informative and material Medium blogs, also Facebook and Twitter updates, ensure that investors remain engaged and well-informed of what the company is up to. Frequent activity in this space makes investors feel much more comfortable. You can foster a kind of organic community expansion that is consistently advertising your project to potential new members. Cornerstone Investors & Exchanges As we mentioned, your relationship with investors in the ICO world is different from that of the traditional silent IPO minority equity partners. Consistent, Transparent & Honest communication is incredibly important here. Even if an ICO is struggling to overcome a problem or whatever issues are occurring, honest communication from the team is key to business survival. You should think of and treat your exchange like a business partner too, a very important one at that. Exchanges provide liquidity for you and your investors. That liquidity is like the blood for your business. Many top exchanges demand nothing less than absolute honesty and integrity, it is imperative to maintain strong and comfortable relationships with exchanges. Everything we have said so far, also applies to your Telegram channel and forums too. These give you another great opportunity to build a thriving community. Team members and investors can enjoy lively debates in their Telegram channels. This can be constructive discussion, or critical commentary too. But it is always valuable as a direct link between the team and the community. It is always good to know how people are feeling and what they expect from you and your project. You are able to use your Telegram channel and forums to consistently adapt your marketing and communication strategy. Keep your investors as happy and comfortable as possible, and you will be more likely to attract new investors and allocations. Other forums around the internet operate more or less in the same manner as Telegram. After a successful funding round with the hardcap reached and time to spare, legal counsel has been secured, and the community is flourishing, the team will prepare for their first listing by paying the exchange fee and waiting for the announcement by the exchange. Unless they are willing to pay exorbitant fees for an immediate listing on Binance for example, teams will usually settle for an initial listing on a second-tier exchange. The fee charged by an exchange depends on many different factors that we will cover in more detail in the next section. ICO Company actions after a Successful ICO Real World Case Study The Basic Attention Token (BAT) project, when used in conjunction with the Brave Browser, allows users to pay micro-fees in BAT to their most-used sites. The idea was conceived by Brendan Eich, the inventor of Javascipt and former CEO of Mozilla Firefox. Investors absolutely pounced on it at ICO and the project raised an amazing $35million in under 30 seconds. The BAT/Brave project has delivered on time on nearly all of its targets, helped in no small part by having a working product, the Brave Browser, for over a year before the token launch. The project secured a listing on the premier exchange, Binance, in November 2017. A project can suffer through a disappointing funding phase and, for example, fail to reach 75% of its hardcap. The team will be only partially funded. Though they may be able to initiate the project, the value proposition of the token has been compromised, potentially forever. The market has spoken. There is limited faith in the team’s ability to complete or carry out their project. Failure to reach a hardcap is a serious obstacle on the project road map. This will mean massive revisions to the timescales for development and listing. Such a project may have to be content listing on decentralized exchanges for a period of time and they will lose any post-ICO hype that could have helped the project price to “moon” early on. There is less money to be allocated. Each section of the business will be underfunded compared to the original plan. There can be delays in code development, exchange listing, marketing and community development as well. Calling the Tezos ICO a disappointment might seem strange considering they raised over $232million. But this open-source, smart contracts fintech platform became a victim of its own success post-ICO by devolving into multiple class-action lawsuits between the founders and its foundation chairman. They suffered from a distinct lack of clearly defined roles and expectations on key positions. There was infighting at the boardroom level. This all caused an as yet unresolved delay in listing and development. This is also one example why a capped ICO can be more desirable for investors than an uncapped ICO. If the team have a set amount of capital to work with, an amount that isn’t absolutely ridiculous, like in the case of Tezos, perhaps the resultant greed and discord is less likely. Although it may not be so easy for speculative investors to make a profit from an uncapped ICO with such a massive initial market cap, it is a very impressive feat of fundraising nonetheless. Tezos’s post ICO market cap of $232million is already 64th of all projects, and would have to perform brilliantly on listing to maintain this position. Company actions after a Failed ICO Failed ICOs can mean either fundraising initiatives that have failed to reach the softcap and will therefore not be economically viable, or fraudulent projects whose sole intention was to steal from investors and do an exit scam. We’ve already covered scams and fraud projects in detail, but what happens when an ICO just fails to raise the requisite funds? Projects that are legitimate, with honest founders and developers, refund the ETH or BTC deposited by investors as quickly as possible if the softcap is not reached. The same process that is followed by ICOs that are oversubscribed is employed by those that have failed to raise enough capital. The process of returning funds back to the sender ideally should take a period of days, but more likely will take a few weeks. The Sappy Network, advised by Dan Tapscott, failed to come anywhere near to their funding goals. They are currently in the process of sending all investor funds back to the wallets from which they came. The statement from the founders read as a textbook example of how you should react to failure with the founder stating “In the spirit of transparency and honesty, we are sharing with the community that we did not reach the soft cap, and thus we will be honoring our terms and conditions and returning the Ethers to all contributors” Exchange Listing A bottleneck developed in the ICO market after the explosion of crypto prices in 2017. There was a massive increase of ICO teams on all stages along the pathway from start-up to fully listed crypto asset. Certainly, a huge part of the value proposition for both the token and the project depends on securing a listing on an exchange. It is precisely the liquidity of the token as a valuable asset on a free market exchange, that determines or even defines its value. The liquidity is what makes tokens attractive to investors, but that liquidity simply does not exist without a platform for the exchange. Unfortunately for new projects, the balance of power is heavily weighted in favor of large centralized exchanges that can pick and choose which tokens to list, and the timescale within which listing will occur. Each large exchange has its own list of pros and cons as well as its own specific procedure for coin/token listing. They also have their own particular ethos regarding the type of projects they prefer to list. ERC-20 tokens will be available for trade immediately on decentralized exchanges (IDEX Forkdelta) but those platforms are generally quite low volume, and certainly not a long term solution. Projects must often pay huge fees to be listed on the larger centralized exchanges. At first those fees will be prohibitive. The usual route is to initially list on a more reasonably priced smaller exchange like Kucoin or Gate.io. Listing Process Major centralized exchanges have the power to list anything they want, and they also each have a unique structure that projects must adhere to if they wish to be listed. Each potential new listing will undergo a rigorous examination by the exchange operators to test the feasibility for listing the token. An exchange will likely have forms available on its website that you can fill out to give them all the necessary initial information. If a particular project and token qualify for listing, the team will invariably be put under a NDA, Non-Disclosure Agreement, to avoid any insider trading or other regulatory problem s. In the case of larger exchanges like Binance, there is a period within which owners of a newly listed coin or token can transfer them to the exchange in preparation for trading. This is a fantastic opportunity for traders to make use of the likely pump that occurs after a new token is listed on a large exchange. It is common to see up to 100% increases on the first day of trading, and a subsequent dump of up to 50% or more can follow. This allows traders holding the coin already, to sell for a good profit, and maybe buy back in at a much lower price too, if they think that is a good idea. Exchange Fees There are no definitive figures available to the public regarding fees that major exchanges charge new projects to list. Binance, Bitfinex, Kraken and Bittrex have all been quoted as saying that they do not charge any fee at all but this is almost definitely untrue. Knowledgeable industry insiders estimate between $500,000 and $1,000,000 USD for listing on a top-tier exchange. (There have been more rumors of 7 figure exchange listing fees since January 2018 too). This figure will vary greatly from project to project. Various factors can affect how an exchange determines the fee for a particular project. These are some of the most important ones: Market Maker Service Required Whether or not the client project requires liquidity services directly from the exchange, or can connect proprietary ones via API, will lead to a huge reduction in listing cost. Type of Token (ERC-20 NEP-5 or DAG) Not all tokens are created equal in the listing process. ERC-20 tokens and BTC based tokens have code architecture that will almost certainly be preferred by the exchange. NEO based tokens (NEP-5) such as Ontology will be far most costly to integrate because separate new wallets have to be built to facilitate NEO transactions. The costs involved in integrating Direct Acyclic Graph projects such as Nano into the exchange structure are even worse. Expected Daily Volume Exchanges derive their profits largely from transaction fees and withdrawal fees. The trading volume a new token is likely to bring in will have a great influence on the computation of the exchange listing fee. Exchange Listing Procedures Evaluation Different exchanges have different rules for new listings. A new project must of course abide by specific rules for that exchange before they are allowed to list there. There are procedures that must generally be followed for the most noteworthy exchanges. You can get a good idea of the hurdles to be overcome before listing can take place. Ongoing relationship with Exchanges Exchanges, usually Huobi or Kucoin, will sometimes make it essential for newly listed tokens to engage in “trading competitions” after listing. Competitions can last between 2 weeks, or a month or more, aiming to increase the trading volume for that token, thereby increasing trading fees collected by the exchange, and giving the project extra publicity too. The whales may have made a nice profit already and be very happy about it; but the project token can still get stuck in a long period of stagnation and a loss of post-ICO hype. Once a coin or token has been successfully registered for trading on a particular exchange, the project must focus on maintaining regulatory compliance and paying things like annual maintenance fees too. Exchanges can investigate and delist coins or tokens to see if they have fallen below a certain standard set by the exchange. The exchange is concerned about such things as: an extended period with an extremely low volume; a team member connection to an exit scam; or other such immoral/illegal behavior. Post ICO Company Evaluation After a presumably successful ICO, the necessary funds have been obtained, and the real business, the real team challenge is now, to bring the project to life as a bona fide disruptive Blockchain endeavor! The core advantage of the ICO method of funding business startups is the lack of regulatory hurdles to navigate with regards to fundraising and fund allocation. The funds that have been raised have, in effect, been freely given to the project leads to do with what they will in a no-strings-attached transaction. Of course, there are still strings attached in that the team are tasked with making that money grow for the investors. But there is no regulatory oversight of the process. The regulatory freedom is a double edge sword. It gives a good team freedom to work however they want; and it also allows for unscrupulous thieves to use the ICO process to defraud investors of their ETH and BTC. Advantages of being Post ICO From Investor Perspective You should have little to fear in terms of fraud from a project in which you have invested, if you have done your due diligence correctly. You can expect the tokens to be distributed, and the exchange listing to take place as expected. And you know your project is totally legitimate. There are different ways to think about your ICO tokens after the crowd sale has concluded. If you are a speculative investor looking for a quick flip, you can gauge the correct moment and sell anytime you like, assuming the ICO has been well-received by the markets. From Team Perspective The post-ICO period is, from the point of view of the team, a period where stress and responsibility for the safety of investor funds is passed, in the form of ICO tokens, from the team to the investors themselves. This responsibility for tokens is replaced with the stress of building the actual company itself, and succeeding in the business as planned. A small portion of the responsibility for the project’s success is also passed on to the exchange that has listed the tokens. This is especially true if market makers have been employed by the team or the exchange to provide liquidity. After the ICO has concluded, all funds are released to the project team immediately, so they can start building their business brand, and tackling each step on the road map right away. The freedom with which startups can operate is one of the main reasons behind the explosion in Blockchain businesses in 2017. With the ICO funds safe, and money being put to work on various areas essential to the growth of the project, and the tokens already distributed to investors, the risk of fraud is greatly diminished. If KYC and Anti-money Laundering procedures have been followed correctly during the ICO phase, the risk of phishing attacks and theft will also be marginal now. At any rate, with tokens safely delivered to all participants, the responsibility has passed from the team to the investor. From Team Perspective The release of all funds and the freedom to allocate them with no supervision, as cited above, is certainly a tremendous advantage empowering the team to fulfil the entire breadth of their vision unimpeded. But it does have its drawbacks. If there is a mistake made in the allocation of funds, or an unforeseen problem arises, there is nowhere to turn to, and no means of generating further money via crowdfunding. The ICO is over; it is finished. The project simply has to work with what it has. Your community can sometimes turn against you when the market is going down. Times like that just add to the already intense pressure of presiding over a startup Blockchain business. Solution: DAICO The DAICO, or Decentralized Autonomous Organization Initial Coin Offering, is a means to integrate a more specific, rigorous and regimented smart contract schedule into the ICO process. Doing so will eliminate fraudulent ICOs, exit scams, pump and dumps, and many of the other disadvantages listed above. The DAICO method, proposed by Ethereum creator, Vitalik Buterin, will merge the core concepts of both an ICO and a DAO to leverage the most relevant features of both, in order to solve the main problems in the ICO method. For example, to eliminate the risk of an exit scam, the release of funds will be spread out over a period of time, with the next allotment only being released when a certain set of parameters are met. Buterin explains that the DAICO method will provide user protection in a manner not present in the current ICO model, ensuring funds are not misspent or used in any way contrary to the intention of investors. In simpler terms the DAICO will operate as follows: The DAICO will start with a smart contract by its executors that can set whether this is to be a capped or uncapped round of fundraising (amongst many other options) as well as including KYC requirements. After these settings have been configured, the DAICO is set into “contribution mode” and presented to the public. This stage will function identically to a normal ICO with ETH exchanged for project tokens. Once the funding period has elapsed, or the hardcap has been met, investors will have the ability to set the “tap” for the collected funds. This will set the amount per second, or amount per minute, that will be available to the executor to develop that specific portion of the project to which those funds have been assigned. If investors believe at any point that the team is misspending funds or otherwise wasting time, etc., the investors have significant options to take. Of course they could choose to release more funds to the team. But, they could also stop the tap altogether, and stop the entire ICO, by voting, and actually release all unused funds back to their own wallets from which the investment had first been made! Learn more on how to market any ICO and STO, get better understanding of security token definition and learn what a scam project is! Follow the link to read the full article: UBAI.co Contact me via Facebook or LinkedIn to know more about our services: LinkedIn Facebook
There is a big cognitive dissonance within the crypto community. The dream of decentralization and censorship resistance is dominated by big centralized exchanges centralized empires like Binance and Coinbase. Speculation still drives the market and fuels the continued growth of centralized exchanges. One of the leading factors fueling the revenue stream of exchanges is new coins, namely ICOs and in future STOs. ICOs became nothing more than a way of Flipping Tokens. Most ICOs used and continue to used Proof of Greater Fool to push forward their blockchain. People invest in something that they know is probably worthless and extremely overpriced, hoping that they can sell that worthless overpriced digital token to a "Greater Fool". In the end, all ICO investors are fools because even if Fool #1 manages to Flip the token at 3x the price he bought it at, he is still the fool compared to the ''ICO that now holds millions** collected by all the #1 fools. Essentially ICOs that list on exchanges right away that have nothing to offer and no product are basically Ponzi schemes, with ICO team at the top, ICO Buyers second Layer and people on the exchange at the bottom of the pyramid. The IEO (Initial Exchange Offering) is a natural evolution of this Ponzi scheme: Now with ICO and Exchanges working together to pump up the price, being able to freely manipulate the price of the token and print free money. As Cryptocurrencies are a totally unregulated market they are pretty much free to do whatever they want. Cryptocurrency exchanges basically became empires fueled by greed, trading fees, listing fees, and so much more. These empires have no interest in changing the system, similar to how banks do not want to give away power. It is expected of anyone in power to be very corrupt in a totally uncontrolled market.
BUIDL VS Initial Exchange Offerings
In 2019, for the first time in 3 years, projects that focused on tech, product, and business development came out of the darkness. Most people pretended to work to look good to raise money, however, some actually worked to solve problems. 2019 was also the year that we started to see Initial Exchange Offerings. ICOs conducted on exchanges compared to publicly. The original purpose of ICOs was to take away the monopoly of fundraising away from stock exchanges and brokerage firms. An IEO is well explained in that scene of Wolf of Wall Street, when they opened an IPO for Steve Madden shoes. Remember when a centralized entity is responsible for issuing a new stock? It probably has a vast interest in pumping that price, but is it legal in the traditional financial space? ICOs that are actually working hard to build their product also understand that in order for their projects to become successful they need to become decentralized. They need to get their tokens in as many hands as possible. Of course, the person that is attached to that hand should also bring value to the project. The best example of the power of useful decentralization is Bitcoin. Bitcoin has a pretty old tech, had a few bugs in their source code, is super slow, but yet it has by far the best community and strongest social consensus. Hashrate doesn't mean much, after all, Bitcoin Cash had a bigger hash rate for a brief while, but it was the social consensus of the mining community that decided not to implement the new changes introduced by Rodger and Bitmain. Now BCH is less than 96% of the market Cap it used to be. The value of cryptocurrencies is defined by nothing more than censorship resistance, game theory, and token holders. In the long term, these three factors will be decisive determining which coin will have the biggest market cap. Bitcoin has by far the most censorship resistance, probably one of the best game theories and by far the best community. The value of a coin is pretty much all about: how hard it is to change the information saved on the block * (sum of all useful skills and influence amongst all token holders) that can be leveraged by game theory within the ecosystem.
Best case vs Worst Case outcome for an ICO
An ICO that is used for its actual purpose and not as a vehicle to facilitate scamming, can be seen as the big bang of any new blockchain ecosystem. Successful ICOs understand that they need to act like economies, not companies. Usually, economies filled with smart people that can utilize their skills to push their ecosystem that is also run by the good government (good game theory) do very well, compared to economies that have a very small set of inhabitants that can bring economic value for influence and skill sets. The optimal scenario for an ICO would be if the tokens were magically distributed among the best developers, business integrators, influencers, politicians and basically anybody that would be willing and capable of bringing value to the new blockchain ecosystem. Bitcoin’s mechanism to achieve this magical community was via mining and its 4-year reward halving cycle. It takes a great deal of passion and technical skills to start mining. Also, the low token price during the first few years motivated the best developers, who are also deeply interested in the technology, to jump onboard and help on its development efforts. This also allowed them to acquire a lot of tokens in the process. The 4 year Bitcoin Pump and Dumps enable very smart individuals to join the bitcoin ecosystem every 4 years and accumulate at low prices. Regulators love crypto once they’ve also bought a bag. Therefore the best outcome is the magical distribution of tokens to all the best developers, business integrators, influencers, politicians and basically anybody that would be willing and able to help that new blockchain ecosystem. The worst case would be an ICO whose tokens holders are mostly speculators, also known as an initial Exchange offering.
This is a pyramid scheme. Bitcoin is not. Bitcoin is not a company. It has no employees and its supply is finitely scarce. No matter how many people adopt it, there will only ever be 21 million bitcoin. The distinctions should be glaringly obvious, but because bitcoin is complex and the very idea of money is not well understood, it can easily be confused. Bitcoin will only become a global ... Bitcoin, by contrast, is only one of these means, same thing goes with fiat currencies. As a result of this, Bitcoin itself is not some kind of Ponzi scheme. What it is is a technology which allows for a highly defined value for its information units. All thanks to the guarantee of a limited number of units thanks to the fact that it is ... But Bitcoin itself is not a Ponzi scheme. Bitcoin is a technology that allows, by guaranteeing a limited number of units because it cannot be duplicated, a well-defined value for “information units”, and thanks to that it can be used as a currency. The good and the evil of cryptocurrencies. Bitcoin, like any other technology or currency, can be used honestly or dishonestly, for good or for ... The concept of the Ponzi scheme did not end in 1920. As technology changed, so did the Ponzi scheme. In 2008, Bernard Madoff was convicted of running a Ponzi scheme that falsified trading reports ... The Bitcoin Is Victim of a Ponzi Scheme While Regulators Sleep. 01/27/2014 06:46 pm ET Updated Mar 29, 2014 U.S. government agents have arrested Charlie Shrem, the CEO of Bitcoin exchange BitInstant, charging him with laundering money for customers of online drug bazaar Silk Road. It started as a nice technology story. Through subtle algorithms, a complex system was based on the basis of a ...
Like any other currency, BitCoin is designed to be used as money, not as an investment. A Ponzi scheme is a type of confidence scam where people who think they are earning unusually high returns ... The only industry Bitcoin has disrupted is the ponzi scheme industry. [ 40:50 ] Questions why people want a currency so detached from the real world. [ 41:12 ] People who use Bitcoin want the ... In this video, I discuss whether or not Bitcoin is a Pyramid scheme or a Ponzi scheme. I conclude that it is neither, simply because: 1) Bitcoin is decentralized, not run by a corporation or ... This video breaks down why bitcoin is a ponzi scheme, why it's price fluxates, and why $100,000 bitcoin will NEVER happen. If you like my work, please considering donating to my PayPal or becoming ... Bitcoin is NOT a Ponzi scheme. MaiView 20190719 MaiCoin Group. Loading... Unsubscribe from MaiCoin Group? Cancel Unsubscribe. Working... Subscribe Subscribed Unsubscribe 1.17K. Loading ...