HelloMonaco continues to talk about the most famous crypto currency and about the interest it presents to investors.
To crypto, or not to crypto
We now find ourselves in an era where multiple currencies coexist. Today, there are more than a thousand crypto currencies, each designed for a specific purpose. Go to www.coinschedule.com and you will see dozens of launches for new digital currencies. Similar to an IPO for shares, these are crowd-funded ventures launching digital coins – an ICO – in which you can buy a stake.
So what is an ICO? An ICO is like an IPO for shares. An IPO, or initial public offering, offers a chance to make big money quickly by getting in on the ground floor of the newly traded company. In the same way, an ICO, or initial coin offering, offers a chance to make big money quickly by getting in on the next new Blockchain venture. It’s a formula that has led to over $3 billion being raised so far this year (with only 200 Blockchain start-ups), issuing digital tokens at a faster pace than any other early-stage venture capital funding. Their digital tokens, just like Bitcoin, soar in value when they trade on digital currency exchanges – making new millionaires and billionaires.
Does it sound like the dotcom boom all over again? That is exactly what it is. Here is a listing of some interesting companies that raised fast money:
- IOTA – Launched 13 June, 2015 – listed a token designed for the Internet of Things micropayment and immediately fetched a value of $1.8 billion. At the time of writing this article, the value of one IOTA token stood at $0.91, which marks more than a 60,000 per cent return on investment since the initial coin offering in.
- Ethereum – Ether’s (ETH) issue price at the time of the crowd-sale in 2014, amounted to $0.311. Ether’s all-time high hit $407.51 on June 13, 2017. At the time of writing, Ether was trading at $367.35, over a 90,000 per cent increase in value since its ICO.
- Brave Software’s lofty Basic Attention Token (BAT), sucked in $36 million in 24 seconds (a $180 million valuation) on the promise of using Blockchain technology to fix digital advertising’s deep problems.
- Tezos (XTZ) – one of the largest ICOs to date, raising $232 million worth of Bitcoin (BTC) and Ethers.
- Augur (REP) – has practically created a betting platform where you can bet on “everything from elections to the destruction of our solar system”. Augur’s ICO helped the firm to raise more than $5.2M in a token sale, with $2.5M in the first three days.
- ChronoBank (TIME) – is like Uber for recruitments as it works on creating an ecosystem where freelance projects are bought and sold with crypto-currency. When the ICO ended, ChronoBank had raised a total of $5.4 million.
Read also Bitcoin – boom or bust?
Will the Bubble Burst?
But not everyone is pro-Blockchain. While Bill Gates likes Bitcoin, Warren Buffet, CEO of Berkshire Hathaway and Gates’ long-time investment guru, warns against Bitcoin: “Stay away from it. It’s a mirage, basically” (14 Feb, 2014). And Paul Krugman, Nobel-prize winning economist, said in December, 2013: “Bitcoin is evil.”
Richard Branson likes Bitcoin so much he has publically pleaded with people to buy even one Bitcoin. He even offers a ride on Virgin Galactica for a mere 35 Bitcoins. More than 700 people have signed up so far, including celebrities Brad Pitt, Ashton Kutcher, Angelina Jolie, Tom Hanks and Paris Hilton, reports say.
If this all sounds like a repeat of past bubbles, it’s because it may well be. The same warning signs – companies with more concept than reality; a rush to day trading; speculator flips; take-your-breath-away volatility; fortunes appearing out of thin air – apply to these digital currencies. In 2000, $1.8 trillion in Internet stock market value evaporated in an instant. Are we going to see more millionaires, more soaring valuations, or are we going to witness a crash? Likely, a bit of both. Blockchain is a real technological advancement and whether it crashes or not, it is going to spawn winners just like the dot-com boom led to Amazon, Ebay, Google and Facebook. There will be casualties on the way, but there will equally be new personalities, new millionaires, new billionaires, new philanthropists – and new scams and losses to highlight.
We live in times of great change, ladies and gentlemen!