More money doesn't speed up cryptocurrency development
Recently the trend of more and more funding for cryptocurrency project alarms me. Cryptocurrency projects are traditionally built by small groups of highly intelligent individuals that right very short amounts of code. This is because cryptocurrency is complicated mathematically and technically, but it requires very little gruntwork to complete.
Bancor Example
For example, Bancor was attacked previously for only having 40 lines of core code - some attacked for costing 3.5 million dollars of funding for each line (https://blog.bancor.network/this-analysis-of-bancor-is-flawed-18ab8a000d43?gi=f7b87fb18654)
As crazy as this sounds, the less code there is in a project the better it is - it means it the code could be more easily understood. It also means that audits of the code can be done faster and with less room for mistake.
EOS
EOS is amazingly successful right now, with more than 600,000 ETH raised in the first phase of the ICO. thats more than $162 M worth of tokens. I love Dan's project and EOS is truely ground breaking. but the problem is - do they really need THIS much money?
Worring trend with Initial Coin Offerings
We have problem with the current ICO climate in that people not supporting crowd funded projects because of the final product - many ICOs are so popular that the tokens or coins can be flipped immediately on the market for big bucks. Because there is a finite amount of good projects - the demand of coins from investors is far exceeding the supply provided by good projects.
This is resulting in good projects having the potential to recieve bigger and bigger amounts of funding. We see a near exponential growth of ICO funding. Whilst this makes sense with supply and demand, the big problem is that these project really don't need anywhere near the amount they are getting to succeed. And more importantly, adding more money to be pot doesn't increase development rate.
What do you guys think of the current ICO climate?
I'm really getting a lot out of your videos. Thanks for doing them. I can see why you're gaining more subscribers: very professional, well-organized, clearly communicated, plus you have a good vibe. One more thing: you like Dash...me too!
Thanks so much chessmonster ! DASH evolution is getting me very excited!
You are so very welcome...and that makes two of us: Evolution will be a game-changer.
Agreed!
Evolution and the latest Dash roadmap are amazing.
The only concern I have is, that the core team of Dash resides in the US and that I see tendencies in the US which are not so good for cryptos. That might effect them and their work.
Good post and good replies so far I think. Yes, boxmining is right and we should be displeased on behalf of everyone's financial wellbeing. Myself also thinking there are going to be lots of failing ICOs and also blockchains and much money lost. Only selected blockchains will make good rewards by proving to have a real use case and followers / users in large numbers - imho steemit potentially moving into this selected group. Fasten your seatbelts, rocket engines still at full take-off power accelerating through v turbulent and nasty weather.
I'm actually kinda worried with many ICOs lately, means there shall be huge dumps of ETH. Investors raises the ETH price as they invest in ICOs, then after that we may see huge dumps. Agreed that some of them should not need that much money.
I think I need to start a coin and get my hands on some juicy $163M dollar investment :D.
I think its a worrying trend, and all it will take is one of these big ICOs to collapse for whatever reason to have a major ripple effect on all cryptocurrencies - at least for a short time, but potentially longer as well. I feel like the ICO thing is a bubble waiting to pop.
If you have 3 developers giving them $20 million extra money will almost guarantee some hookers and some blow. It's actually detrimental on the long run. Like overfeeding a cat.
thats a great point, it might actually decrease productivity!
I could not agree more with this sentiment. Taking time out of the equation will be the key to progress, not money. Money is an enabler, but not the whole tool.
This is a good point. In most blockchain projects there is no need for a lot ivestment in infrastructure for example. The internet is already there and almost everyone has a computer and/or a mobile device.
The most revolutionary projects are often cooked up without anyone getting paid for it, but just because someone believes in something.
BTC ico was exactly 0$, I'd say that technology did pretty well :)
I am new to cryptocurrency and I started wathcing your videos before I even was on Steemit. So my knowledge is very limited in this regard. But I totally see that as a problem because it is so obvious that people just try to pump and dump the new currencies. That will hurt these projects and probably even destroy them. And that will create a bad reputation for crypto in the main stream.
But bad apples exist everywhere. Like you said, a few highly intelligent people develop technology that can change the world. And good ideas have a better chance these days than 20 years ago.
I asked you this before but I haven't seen any post from you about it yet: What do you think of LBRY? They haven't had a ICO and build everything up from scratch with the community. They do have some strong backing but because the idea is good not to speculate.
Yes there is much money, and there is also a lot of risk (bankor is a clearly example with 40 lines of code).
PS: EOS is already traded on bitfinex and kraken.