Those couple of years around cryptos - investing, selling, winning and crying - have been a great school for all of us. I went so far that I turned my screwing around ICOs into becoming a partner of veracityprotocol.org and a methodologist for RocketDAO. Since we are experiencing a crypto winter right now, hodling at the furnace and warming our hands at the dreams of “getting it back again”, I will take this chance to debate what is happening and perhaps going to happen.
Why so serious?
Many people are pessimistic these days. The obvious reason is that the prices are playing the dead man’s beeeep. But that can be a reason for pessimism only for people with a very short memory - or the unfortunate generation whose first buy was in January’s high and couldn’t know better. The rest of us, we have been there, several times in fact.
After a period of hype and feeling that the world is ours, prices plummet and stay at a long dead stall. I started out having short patience and an investment horizon in weeks, and the wait used to be intolerable. But having survived several of these winters, we are veterans of patience now. And we know (this is the main strategic takeaway) that the crypto market as a whole is still at a few percents of its potential.
This is only the beginning
The powers of the blockchain are often underestimated and even many of the people working in the field do not fully understand them.
Anonymity? Blah. I mean, I love it. But it’s not even there and many are gonna pay for thinking it is - once the tax collectors collect themselves and turn the “immutable ledger” of all our transactions into an immutable ledger of taxable income.
It is the guarantee of trust without the need to trust anyone in particular that is revolutionary. Any time we interact with others we have to rely either on their honesty, or on some third party that will enforce that honesty - as long as that third party itself is honest. You get the picture. We need trust in order to be able to cooperate. And right now, outside of family, most of that is provided by the states and their laws and law enforcement.
As we can see all around us, it works so-so, as often as not blowing up into our face. Blockchain is finally a solution that can provide trust that can‘t be broken or abused. It is still making baby steps, but it is the future. Flat prices mean nothing in the long run - we have most of the growth ahead of us.
Easy millions
Before going into the near time predictions, I will write a bit about what is happening right now. Many say that “ICOs are dead”. ICOs, as an opportunity for the common men to directly invest into whatever new product they believe in and even directly affect its future through governance, is a great thing. Unfortunately, this has become too much of a thing when any retard who put together two pages of a whitepaper collected million+ dollars, leading to the stage where we had three ICOs a day. It’s not a surprise that investors’ money and patience ran out. Unfortunately, many great projects fell victim to the exhaustion when they came too late and failed to raise their softcap. But again, this is just a short-term thing and not a killing blow to ICOs. It is a great concept that will resume as soon as investors regain their composure. And this time it will work much better, thanks to due diligence mechanisms that have developed since. But it might take much longer before the common men (= not qualified investors) will get another chance.
Regulators vs. ICOs
Another thing is happening that is more serious. The regulators are catching up, enforcing their rule. No project attempts to raise funds without a KYC these days (something that would be laughed out of court last year) and that is just the beginning. The whole point of investing is to make money - and you are not allowed to make money without the state giving you a go and getting their cut. In their lingo - a share (token), that is supposed to make profit, is a security - a term invoking more fear in ICO’s managements than Voldemort’s name did to those poor kids. Being qualified as a security is basically game over - throwing the project back to the realm of a classical business that needs to adapt to all regulations and mainly - saying bye-bye to a public sale and crypto exchanges. That puts ICOs in a tight spot - to either betray their stakeholders by removing any hint of a profit from their token = becoming a real utility, or going down the security path, which is what the founders wanted to avoid in the first place.
There are three possible outcomes right now:
- regulators will kill ICOs for good.
- the hunger for freedom behind blockchain will prevail and ICOs will go on - leading to a war.
- regulators will relax their requirements and give it a chance.
Option #2 is not going to happen as the regulators are already winning. Most of the market, including the exchanges that form the backbone of it, already comply. The most likely is option #3 since regulators are not that stupid. They know that by allowing it they will appease people, regain control, and secure the highest profit into their pockets. I don’t like that prospect, but it is the best we can hope for. Let’s hope it also comes soon so that the progress can go on.
So what is ahead?
In short, blockchain will go on and ICO’s not dead. Many great projects made it past the dangerous regulator reefs in time and will spread the technology into all branches of industry and our lives. Other projects will follow once the security issue is cleared. Another hype wave, and many more, will come, again and again driving prices 20x up, and it may not even take long. The huge shit ICO bubble of course also means a big extinction - which will be silent, with some projects not waking up from the current limbo, with their tokens becoming a historic collectible. The 1000x profit opportunities are not yet gone as many parts of the technology spectrum are still unsolved. Finding them will be more and more difficult, but there are still many revolutions ahead of us, before our issues, such as funny money or politics, are solved. So hodl on.
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