The Blockchain, Cryptocurrency & Investing on "Yet"

steemitph (64)in #steemph • 6 years ago

For the most part, Initial Coin Offerings ask that you put your money on "Yet". Investopedia offers this definition of ICO:

_{An unregulated means by which funds are raised for a new cryptocurrency venture. An Initial Coin Offering (ICO) is used by startups to bypass the rigorous and regulated capital-raising process required by venture capitalists or banks. In an ICO campaign, a percentage of the cryptocurrency is sold to early backers of the project in exchange for legal tender or other cryptocurrencies, but usually for Bitcoin.}

_{Also called an Initial Public Coin Offering (IPCO). ~ investopedia.com}

While this definition is a little outdated and is rather over simplified, it captures the most basic aspects of ICOs. Most projects I've seen started ICOs with very little to no proof of concept and are armed only with a conceptual white paper. This is the biggest difference in traditional investing. In contrast with Initial Public Offering where a young company seeks to raise funds for expansion, a prospective investor can evaluate the existing business and operating model, read financial statements, and maybe even get some idea on the prospects of growth based on literature required to launch an IPO.

In the statements above, the differentiation is quite extreme. Even after the ICOs however, up to when a project's been operational for more than two year like in the case of Steem, buying in is still very much based on the "Yet". By "Yet" I do not mean simply the appreciation of price over time, since all type of investing is based on the prospect of profit.

By "Yet" I mean how the entire space is set to revolutionize the way we do things today so much so that the most basic of things will be aided by or fully operating within a blockchain. This realistically speaking will not happen tomorrow, or next month, or in the next couple of years. Much like the caterpillar in this video, the tech and the community behind blockchain have to evolve into a butterfly.

In their current state, the most popular platforms function well within their set communities, and some stablished real life or economic use. There are issues surrounding adoption and scalability however, which if addressed will allow the caterpillar to grow wings; and impact the world much more than a caterpillar ever will.

There is the existing Sharing Economy to start with. CHASYR mean to operate global ridesharing platform within a blockchain tech. Garrett Camp, co-creator of UBER also recently announced venturing into the blockchain and cryptocurrency world with eco.com. Similar to airbnb, RentBerry intends to run a property sharing platform, but be a true sharing economy platform powered by the blockchain instead of a centralized model.

The biggest challenge today hindering these projects to be adopted is the volatility of tokens and coins prices. This is a key evolution that has to happen, left to its natural course however, the volatility is likely to stay for several years still. Some platforms have and are attempting to make secondary currencies that are meant to be a lot less volatile. This is Steem Dollar in the case of the Steem blockchain. While we Steemians (myself included) become ecstatic when Steem Dollars' price spike, we might just be missing out on the value of a currency truly pegged to a dollar.

The updates on Communities and Smart Media Tokens are a good example of how a blockchain can evolve. If you think about it both bitcoin and ethereum evolved quite far from the original use case; bitcoin from a peer-to-peer payment to digital gold, and ethereum from a goal of being a platform to build decentralized applications with is mostly used for ICOs.

No one can say when the tech will reach its full potential, the truth is it might just continue evolving.