I've been in the cryptocurrency space only a couple of years now, but in that time I think I have formed reasonably balanced views on...
I've been in the cryptocurrency space only a couple of years now, but in that time I think I have formed reasonably balanced views on how it appears to work.
'Crypto' has been one of those game changers. Well, in reality the underlying technology "the blockchain" has been the game changer both in a technological and societal sense.
Generally speaking cryptocurrency has no underlying asset to give it value, it is an algorithm and a concept - the value is driven purely by the emotion and belief of humans trading on crypto exchanges. This is a high risk, highly volatile environment but the payoffs can be considerable for making the right calls.
Initial Coin Offerings (ICO) are perhaps some of the most hard-to-pick aspects of crypto investing. A lot of them are just financial backing for proverbial sh*tcoins in the making. If you do some due diligence you can increase the chance that it might be a successful hold later on however.
I originally got wind of the Electroneum project while actively hunting for promising ICO's. I am not going to bother posting my process for due diligence here - that is material for future article - I admit had a few concerns, however the mass marketing and simplification (the two decimal place currency) appealing to new/inexperienced users of crypto who didn't necessarily want to know the technicalities of trading was what made me think this might be worth buying in to. Both short and long term.
I got in during the 30% bonus round of their capital raise and spent just 1 ETH (worth AUD$388 at the time of transfer) to put aside a small stash of 39557 ETN
Due to some circumstances that you can read about on their social media if you are interested, they had to lock down their wallets for penetration testing just before launch. Mining the blockchain however was enabled, creating a divide between ICO holders who couldn't access their tokens and miners who were able to start trading on the exchange. This situation created the perfect storm - sometime known as FOMO (Fear Of Missing Out). The marketing of ETN is good and certainly seems to be appealing to the masses, people who hadn't been able to access the wallets were buying up ETN at market price, driving the token to new highs.
Right at this very minute I am looking at ETN in my portfolio and it is sitting at an incredibly healthy looking 1628.24% gain from my 30% bonus buy-in price.
As you can see from the graphic, the Electroneum wallets are also opening in under 15 hours which will allow holders to transfer them to the exchange if they wish to.
At this point I am going to put my money where my mouth is, since I have been giving 'don't do it' advice on the ETN social feeds to those attempting to buy at a high point (again FOMO) just before millions of tokens are release into the wild. Yes of course no one can absolutely predict the price trajectory of crypto, but from previous experience you can see repeatable patterns. And those patterns are quite familiar with ICO's going live.
OK so make the call, what am I expecting?
An initial spike followed by a massive dump as people cash in on profits realised by their bonuses which starts an avalanche of selling for weak hands who don't want to lose cash.
What am I going to do?
I'll be cashing out my 1628.24% (more or less when it goes live) profit. I don't pretend to be an expert but this isn't the first pattern I have traded on to make serious gains. I'm expecting a reasonably large retrace to lower levels and once it finds support I will buy back in. Hopefully with many many many more ETN to my name than I originally had, all by using only initial outlay of AUD$388
I expect in time the price will rise, the marketing team seems to know what they are doing, and the hype around this coin is building in the general public eye.
If I am wrong happy to admit it, crypto is a tricky beast to 'predict' - this article will remain here as a record of if I got it wrong or right.
Superb content on cryptocurrency
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