Ultimate Cryptocurrency Guide - Know What You Are Buying! - Utility Coins
This series of articles act as a kind of continuation of the mini-series, How To Avoid Becoming An ICO Idiot, and is part of my wider #cryptonewsNviews series.
Although this post mentions a particular cryptocurrency, it is much more about helping you categorise coins so that you can come to an informed decision all on your lonesome.
Right, let's get on with it!
Utility Coins
I personally love utility coins; why? Because utility coins are useful! Before I start banging on about why they're amazing and how I want to have children with them, let's have a quick look as to what exactly they are.
The What
A utility coin is one such token, that either can, or has to be used on a given platform or platforms. For instance, our own favourite Steem (and to a lesser extent SBD) is a utility coin.
Without Steem, you cannot use the Steemit website, or any of any other Steem related apps. You need Steem to set up an account, you need it to vote, to delegate and to withdraw funds, ergo, there is a use for Steem over and above being a sellable asset.
The Why
The value of a utility coin is often directly correlated with the popularity of the platform it is being utilised on.
For instance, I remember being told that Monero (not strictly utility) was just about to be accepted on various darkweb market places. This for me signified its incredible usefulness, plus of course its anonymity would appeal to people trying to buy (illegal) drugs online. So I bought some at $4, I checked not that long ago and it was around $150.
Rising Star
There is one particular rising star that has caught my attention, and that is Verge coin, mainly abbreviated as XVG.
Unfortunately for me, I bought some verge when it was only 62 Satoshis (less than $0.01), but got bored and sold them, only to see it rocket up to around twenty times that value!
Arrrrggggghhhhh!!!!
However I am of the mind that mistakes can be rectified, so I swallowed my pride and bought some more at around 600 Satoshis (c. $0.07). The reason I did so, is that they have just announced a deal with Pornhub.
Swollen Morals
Whether you agree with the making, distributing, and consuming of pornography online, you can't ignore the fact, that it makes a lot of money, for a lot of people.
Apparently around $32,000,000 is spent purchasing online pornography . .
[Wait for it!!!]
. . . every second!!!
That's a breathtaking figure, which equates to an annual multi-billion dollar industry. One of the most popular companies within the sector is Pornhub; whom through genius marketing have managed to garner a huge market share, and a modicum of respectability in an impressively short amount of time.
Case Study
So what does this mean? Well let's look at the ah, um [ahem], pornographic model.
Apparently it is possible to view lots of free porn online (I can assure you this is news to me!), so an enthusiast can browse to his or her heart's content without ever having to pay a dime.
However, these free porn samples that I regularly look at people look at, are actually adverts for paid sites. The idea is, if you like their 5-8 minute clip, then you might like an entire website filled with whatever smutty delight they are advertising.
So imagine this, you are sitting at your desktop, and you have decided to browse Pornhub, I know it's hard for you having never done such a thing, but just go with me on this one for a sec.
So you're sitting there and you come across a particularly bendy set of men and women, who are performing a variety of dexterous, sexual gymnastics; and so you decide you'd like to see more of them.
You are just about to click yes to the $23.99 per month ($14.99 if you buy a year up front [cough] I assume), when you realise that for a variety of reasons, you don't particularly want ButtPlugWars.com (yes, yes I made that one up...don't Google it) to show up on your bank statement.
So here is where Verge steps in, once your wife/girlfriend has left the room you can use Verge to pay for your pornographic feast safe in the knowledge that your sexual proclivities are hidden from the prying eyes of your bank manager, and anyone else who happens to spy upon your statement.
Add to that, the fact that Verge is also a privacy coin, meaning that it may be difficult for any given snooper to know you have any in the first place and . .
Job done!
Conclusion
Utility coins are used either exclusively, or in tandem, on a platform like Steem or Pornhub. Their value is effected by the popularity of the platform they're used on.
So if the platform grows, the coin will tend to grow with it, like in the case of Steem being $0.25 cents back in July 2016 when it had around 10,000 users, and being roughly $4 today, with circa 800,000 account holders.
Investment
Over the next few weeks, I personally am going to buy as many of these things as I can afford. If you like the idea of utility coins, then this is one that I advise you to get; because Verge and Pornhub are going to be a (polygamous) marriage made in (porn) heaven.
Very difficult not to post another 20 of these jokes. And yes I know I'm infantile. And yes I know you're not meant to start a sentence with the word 'and'.
DISCLAIMER 1: Verge coin was hacked a few weeks ago, someone subverted the blockchain and stole 2million Verge. However they have since fixed it, and as far as I'm aware, everything's fine now. But don't blame me if it's not, I don't work for them.
DISCLAIMER 2: I am giving you investment advice, however seeing as I'm not soliciting you into my office, I am in no way responsible if you lose every penny because of my advice. So for the following three reasons don't bother complaining to me:
- I follow my own advice, so I too will have lost all my money.
- I don't live in the United States, so your chances of suing me are less than minimal.
- I don't actually care.
Image Credits:
Title Image - by Alexandru Sofronie on UnsplashPornhub ads- Yeah I stole them, but seeing as it's free advertising for them, I reckon they'll be okay with it, in fact, I'd hazard a guess that they made 'em so funny in the first place to encourage people to share them.
DO YOU LIKE UTILITY COINS? DO YOU KNOW OF ANY GOOD ONES? IF SO, THEN AS EVER, LET ME KNOW BELOW!!
Pretty much agree with everything you've said here. Utility coins are great, especially if they work. Great example using pornhub, had no idea that $32 million is changing hands every second, that is an
ejaculatingextremely high number, but I guess there are a lot of horny people out there, not that I would know.Haha, I must say, I'm getting rather hot and sweaty with excitement over Verge, it's up 24% since yesterday; woohoo!!
Cg
that's potentially 24% more stroking time for the same cost. You've found a winner!!
ButtPlugWars.com ahahahhaha :D OK! :D
Thanks for explaining what is utility token. I understand what are you saying here. Porn industry is money making industry, and it's making a BIG BIG amount of money, as you said $32,000,000 for online porn, EVERY SECOND.. WTF? :O That is a crazy amount of money.
It seems this coin can have a future with PornHub, cause everything revolves around sex, and hopefully everything will revolve around cryptocurrencies in the near future.
Have a great day, Luka.
No problem, I will carry on categorising them, because it makes your decision a lot easier when thinking about investing.
Exactly, this is a real world indicator, something that very few cryptos have, we love indicators because they help to tell us whether a market is going up or down, simple! :-)
Thanks for popping by Luka!
Cg
Thanks a lot for that, some people are still new in this (me) and it really helps them A LOT to read some simple explanations about particular things in the crypto world.
As you said it, this was a simple decision. And, I really can see the future in it. If you put a naked lady on an add for yogurt, you just raised its value :D So... It's simple haha
Wow this is so amazing I know of course that STEEM is a utility coin however I've never even heard of verge, imagine the way it skyrocketed and and you sold for far lesser earlier, one thing Is sometimes we make terrible mistakes with cryptocurrecy I'm glad you rectified this though at a higher price.
But pornhub with a coin? That's huge I've not heard something like this, I think there will be a massive jive in the price of verge very soon
It's amazing isn't it? The price actually went down after the news, but it is recovering now, you can get it on Bittrex, and most other exchanges. It's about 760 sat at the moment.
Cg
Scratch that! I've just checked, it's up 24% since yesterday, up to 912 sat now :))))) Get it while it's still cheap!
Cg
Amazing, thank you for really informing me.
You talked about XEM in your ICO idiot post. I bought some and made a little bit of profit.:)
If utility is considered where would you place XRP...I know many people don't like ripple but still...
XRP is still as yet undefined . . . It wants to be a payment system, and as such it can fall into the utility token area. However it is not yet clear exactly how they are going to deliver this system, if they deliver it on their own platform, then it jumps into another realm, one that I'm discussing in my next article :-)
Cg
I will definitely love to read your stance on XRP....
Very soon my friend :-)
Cg
Oh by the way good on you for making some on the XEM, I'm going to hang onto mine for a while, I think it's a slow burner. I might sell a fraction if it hits $2, just to cover my initial investment, then I'll just let it ride.
Cg
As far as I've understood it, the Ripple protocol works quite independently of the Ripple token; the protocol is primarily made for fiat transfers. In this context the Ripple token clearly is not a "utility coin" in any sense.
But in order to use ripple for fiat transaction one need to use ripples...
Each transaction requires some ripples to be burnt...
I stand corrected
Nice talking to you...I am giving you a follow...So that we can have further conversations in future...I would love that:)
Seems like Spankchain is getting f***** by Verge. 😮 😂
Ha, good one! The problem with spankchain is that they are trying to reinvent the market (which may one day be the way to go), however Verge will slip seamlessly into a very successful part of an already existing channel.
If I want to use spankchain to pay for porn, then I have to be on their blockchain; which I'm guessing won't be as diverse, or as easy to find, or have as many free samples as the world wide web. Whereas if I want to use Verge, all I have to do is go onto Pornhub, and away I go, or rather here I come! :-D
Cg
Well said! At the moment it's like drunken socially awkward guy versus Casanova both trying to score, who will win? Hm hm.. maybe if Casanova goes to jail - nah, now I'm just stretching it.. hahah
Hey guys, forgot to mention one of my favourite utility coins, the Binance coin. It is used to give cheaper fees for anyone using their exchange.
Cg
Being a "utility coin" and a coin "having utility" is two different things. If PornHub wants to utilize the verge coin for their payment systems, then that gives the verge coin utility, but it does not make the verge coin into a "utility coin" as far as I understand it.
Further, it seems to me that coin value is driven not by their utility, but purely by speculation. Eventually, a rumor that a coin may have utility in some future is enough to pump the price.
Semantics, the point is it will have an extremely popular use, therefore it is not unreasonable to expect it to go up like crazy once people catch on.
This is the case for a LOT of coins, almost all, but not for all of them.
The reason Steem costs what it does, is largely due to the amount of people using the site and its associated apps, if nobody used them it would be worth a few cents.
Cg
Actually, it's fully possible to use the Steem platform without buying any Steem tokens - and the Steem tokens is only valuable as long as people are willing to buy Steem tokens.
Why do people buy Steem? There are several reasons, here are some:
Which one of those do you think is the most important one? (or do you see other reasons that I don't see?)
Not true, even though the Steem you get for free when you open an account is gifted, it still costs, and is still integral to the working of the platform.
If you power down all of your Steem, your account is essentially frozen, you'll be able to log in, and browse your stuff, but no voting, posting, or commenting. The Steem gives you the bandwidth to operate.
Also If you want to get an account immediately, you pay $10 for the privilege.
The reasons you list are true, and I don't think it's about what's more important or not, the fact is there are a myriad of ways to leverage your Steem that are becoming apparent everyday.
For instance, you have the bank of @neoxian, he has decided to use his Steem to leverage a financial service.
Then you have Utopian, who use their Steem to fund open source projects. Then within Utopian you can create a funding bot to support your project's marketing efforts.
So Steem, regardless of what you think of Steemit, has a use that extends beyond a Keynesian 'circle jerk'. The fact remains, that Steem is useful beyond being a coin you hold and/or trade.
Cg
I kind of agree with you, i have never heard of verge until now, this is more of a eye opening for me than just a post..... In the nearest future, crypto will definatly rule the world and investing now is the best for future comfort...... Thanks alot for taking your time to run this wonderful analysis.... I find this post very valuable for future benefits.. Thanks alot
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Never realising pornhub made so much of ads with full of creativity! I've been trading Verge for some time without knowing much of it, thanks for the insight.
Yeah they are a very clever company when it comes to marketing, and they have hooked up with some diverse companies including the World Wildlife Fund!
Cg