"The Power of Concept in ICOs"

The Glaring Boom

A bubble is a very simple, yet very important concept to understand for those of you who just started saving and investing. It is paying too much for an asset with very little intrinsic value. Or more simply put, it is the exchange of excessive value lacking merit.

In today’s age of innovation from uploading information into DNAs to creating real life Iron Man suits, we, more than ever, forget what type of world we are living in because of the hype going on around.

Ethereum was running around $8.14 the beginning of 2017.



After 6 months, Ethereum was 394.66 mid of June.

For instance, we forget that an increase of 4,800% in a little bit over 6 months is--uhhh….quite unrealistic.

        

That's how we get our house!

Recognize your reality from other people's reality.

Uh...yeah. What about those who lost what their money?

The Doom

Now let’s analyze what happened here.

Quoting from The Economist:

ICO “coins” are essentially digital coupons, tokens issued on an indelible distributed ledger, or blockchain, of the kind that underpins bitcoin, a crypto-currency. That means they can easily be traded, although unlike shares they do not confer ownership rights. Investors hope that successful projects will cause tokens’ value to rise.

ICOs are, generally, more similar to crowdfunding than IPOs. When investing in ICOs, you are investing in vision and speculation, as opposed to investing in vision and performance.

The result??

In the past 7 months, 65 ICOs have taken place. Only 26% of which were funded for a total of $309,000,000 USD invested within the duration, averaging $12.8 Million USD each. Making the odds of being correct (statistically), 1 out of 4 (So..... for you to be right, that means you have to do 4 times as much research as you would normally on a booming market.)

That's a big problem.

Out of the 26% (17 ICOs) of the coins that were funded, only 1 is accounted for half of $309 Million -- yep--half.

That means..

Fund Strategy! I should invest in a minimum of 4 ICOs to account for historical data showing inefficiency, make sure I flip it and gain 400% my money back..

Really? Flip it for 400% gains? Wake up bud. Your odds get lowered. Sooo.. Nope.

Now it's clear that there is a factor that extremely differentiates these cryptocurrencies. Otherwise the average, if the biggest was taken out, wouldn't look so different from what it is now. These things do not happen by chance. Nothing is.

Let's try to understand what's going on here. To help us, I've gathered some information that could provide insight to who is investing where.

• At the time of this writing, only the top 305 currencies have market capitalization beyond $1,000,000 USD.
• A total of 122 ICOs will have occurred covering November of 2016, all the way to November of 2017.
• Most of the newly created currencies rely on any 1 or more of the top 50 cryptocurrency codebase, blockchain, or a mix of which.
• 86% ($90,220,146,103 out of $105,177,929,482) of all the money in cryptocurrency is in the 0.01% (or 10) of the biggest cryptocurrencies.
• The purpose of most new ICOs are aimed to create solutions for the smallest, slightest problems. Innovative, if you will, not necessarily efficient.
• The ICO that  raised the highest amount within the past 7 months was Bancor at $153,000,000 USD.
• Not accounting for the failed ICOs, Equibit was last place raising only $550,000
• Both Bancor, and Equibit was built on already existing codebase or platform.

Based on the traffic data gathered from SEMrush, their 2 websites started quite differently.

Bancor Online Traffic

This shows that when the website was created(In this industry, the only marketing that matters is PR and your website.), it didn't have a lot of traffic unlike.....this guy Equibit below.

Equibit Online Traffic

Equibit is a subsidiary of the Equibit Group which was incepted on 2013. It started with some hype after telling the public about their plans for an ICO (Most likely due to the outflow of website traffic coming from their already existing website visitors).

Despite which, it did not hit the same levels of interest coming from the public compared to Bancor, a new company-only incepted on the 1st quarter of this year which did not gain significant traffic within its 1st 2 months but has closed a whopping amount.

Remember when we all agreed that nothing is by chance (We did didn't we?)?

The Market has spoken ladies and gentlemen.

It does not react to the technology differently (There are winners, and there are losers).

It's showing that the Marketing/Visibility does not alter the results of the ICO heavily.

It disciplines everyone who thinks that this bubble ain't gonna pop.

So if not technology, then it's the...uhh...people??

That's right! I mean, no. Not you. Not me. no.. no..

It's who's involved in it, and what they believe in.

I see this as a case of belief in the concept, targeting a specific market segment. 

You see, we don't have any business owning anything other than Bitcoin (unless you're constantly buying stuff from the deep web, then it would be useful to hold some Monero and Zcash too). We don't need to own Litecoin or whatever coin right now. You can't exchange it for food, no commodity (not commodity like crude oil you fools), not even water. Everyone in here knows we are all speculating for capital gains, and we aren't in that mindset yet of buying low getting capital gains, THEN SPENDING IT FOR FOOD. There's not enough support, there's not enough infrastructure. We are just not there yet.

Think about it for one second. Do you really think that in a world full of speculators, the market is the people?

So who makes all the moves?

The Market Movers. Hedge Funds, Venture Capitalists, Billionaires, Large Companies and Governments

Case in point

Bancor targeted mostly financial institutions while leveraging on the blockchain system. BNT tokens had a direct use within their proposed implementation which offers heavy liquidity. Thus, offering a lot of potential for day-trading in a new investment vehicle lacking the complex and advanced tools and systems already existing in the ForEx Market and the Stock Market (Eg The “Electronification” on Wall Street). A clear advantageous angle.
Bancor, is like a Central Bank for Cryptos, where the capital (crypto or fiat) is used to back the new "smart tokens" to be created on the platform. Involves the functionality of creating a fractional reserve system that the “smart tokens” will follow (ratio between reserves and smart tokens to be produced). The value of the smart token will be based on the actual reserves within the platform and the ratio that will be set.

On the other hand, Equibit, targeted the General Population. Which is great in theory, but in reality will limit the potential. Trading on Equibit will be reliant on systems set by the founders themselves. 

Equibit, a fork from the BTC blockchain. Serves as a blank stock certificate. Integrating the digital currency to a digitized stock certificate, to be signed by a company looking to offer shares. A replacement of the normal IPO gateway, and the exchanges where you could trade them.

Fact-check: Does it really look like the public could have found out about Bancor in 3 months, and poured in $150 Million USD? No. That’s why 83.96% of all the tokens after the ICO was sent to only 100 addresses.

It is clear that there are conflicting interests among securities brokers(or the intermediaries their platform was trying to get rid of), and their system. If Exchanges are replaced, the brokers are left with no upside potential. Only competition. Along with it, the Institutional investors who work with these brokers who do the actual trades and provide gains did not see this with great opportunities.

Aaand they end up with $550,000.

So you see, we are not in a bubble. We're in their bubble.

"Only when you find out where you are in life, can you move forward."

My conclusion

When you hear an ICO that everyone is telling you about, do not listen to any of them. There's a reason why not everyone makes money and a reason why only a few really break the bank.

The key is knowledge and you know it. Find your market movers and track their every movement.

Now that light has been shed upon where you are, take actions situated on those that truly matter. Know who your enemies are. You know there's money to be made and you also know that someone bought Ethereum at $393. Whoever was late, was late because they never decided to be early. Don't catch the shuttle dude. Never ever do that.

When you end up with a compelling research about a certain investment you intend to take action, do not share it with anyone but yourself. Be greedy.

"Greed for a lack of a better word, is good."

I'm kidding.

What I'm saying is, don't tell the world what to do. Instead, show them what you have done and why you did it. It's never your obligation to tell anyone how to make money in something they never bothered to learn about, but is in it. (This is my point of view, but is almost purely objective of course) See there's a famous saying in Wall Street..

"Do not lead the Sheep to the Wolves."

That about sums up my research, and the conclusions I came up with.

I hope you enjoyed reading a new take on our industry today.

I look forward to serving you my best content in the future (This is my first time posting long-form content so feel free to comment on anything that you think is right, or wrong with this.)

If you had a great time, please upvote and follow me @stjohngo.

GLTAH. May we all ever be vigilant in the cryptocurrency world.