Adventures in Cryptocurrency, Lessons Learned the Hard Way

If you are invested in smartcash, then you probably already know what's been going on with SmartNodes.

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For the newcomers here's a brief summary.

SmartCash has a new feature called SmartNodes that will come online in about 76 hours from the time of this post.

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Information about this started coming out in the weeks before the release and started drawing more and more people wanting to invest.

Here's a chart of interest over time.

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As you can see it's starting to get more and more attention.

Now we will talk about why this caused me to learn a lesson the hard way. Before going further I would like to state this is my understanding of events based on the reading I did while waiting for everything to get cleared up. If I am mistaken about one or more portions, please let me know in the comments.

Leading up to the release of SmartNodes, there was a large number of people purchasing enough coins to reach the 10,000 requirement on exchanges. During this time the exchange with the largest portion of SmartCash trading was performed on Cryptopia. During this time Cryptopia was going through growing pains of their own. Going from two individuals running the site to fifty. Going from tens of thousands of users to millions of users. They doubled from 500,000 users December 1st to 1,000,000 on December 31st. By January 3rd they had added another 100,000 users. The market was booming and so was Cryptopia. So much so they were having to make major changes to their trading pairs with LTC and Doge. For the source on this please read the Letter from the Founders on Cryptopia's news section. Unfortunately all this came at the same time as the wallet upgrade to support SmartNodes.

In preparation for the new SmartNodes feature a new wallet code was released. Exchanges were asked to halt trading, deposits, and withdrawals. Then they would upgrade their wallets. After which they could resume trading, deposits, and withdrawals. This is a slightly time intensive process and with Exchanges being so busy it was going to take even longer.

To re-iterate, all trading, transfers, deposits, and withdrawals were halted for SmartCash on all exchanges. Users also ran into issues outside of exchanges if they tried to transfer or receive coins without upgrading their wallets.

Some Exchanges chose to prevent trading. Others continued to allow trading. On the exchanges that allowed trading a upwards spike in price occurred. A few different elements combined to cause a spike in the price.

• No coins could go in or out due to the wallet shutdown.
• Limited supply of coins on the exchange.
• Increased demand for them due to the SmartNodes.
• Speculators being drawn to it due to the price swings caused by the other elements.

Here you can see how wild the swings were with the price jumping all over for a few days before settling back down.

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Holders on all exchanges began to get upset as the exchanges took multiple weeks to come back online. There were a few reasons to be upset or concerned. To some people all of these reasons to be upset applied which multiplied their frustration.

• Those not on exchanges that allowed trading felt like they were missing out on potential profit.
• Those wanting to startup their SmartNodes were upset they couldn't withdraw the amount needed to reach the 10,000 coin requirement.
• Finally, there were those who just wanted to get the coins deposited in time for the SmartRewards snapshot.

Most Exchanges had their wallets online before the snapshot date. As Cryptopia users know, they were able to get their coins in time for the SmartNode, but the missed the snapshot for the SmartRewards.

This is where the hard learned lesson comes into play. I should not have left my currency on the exchange and instead should have withdrawn them immediately after purchasing them. Once the reward payout occurs in February we will find out how much I lost. It will be a costly lesson, but one I will take to heart.

The positive lesson I learned is just how hard the SmartCash developers work. There were constant updates on their Discord as well as people answering questions to those coming in late and trying to understand what's going on. From my understanding the SmartCash team worked tirelessly to get the SmartCash trading operational on all exchanges by offering support and helping balance the ledgers for coins that were sent after the wallets were supposed to be shutoff. I'm happy to be a member of such a community.

I look forward to talking about my experience starting up a SmartNode soon.