ICO Flipping
A lot of people made a killing flipping ICOs earlier this year, but it seems like that easy money is mostly gone for now. More recently a lot of ICOs have gotten dumped upon hitting the exchanges. It was bound to happen, when something is that easy everyone will pile on until it’s no longer profitable. The cool thing about ICOs was that it allowed small time investors access into early stage investments. Something that was never really possible before, and only the privileged with millions of cash and connections could have. Well, I think going forward flipping will once again become a game for the large holders with connections. I think if you want to flip an early stage coin you’re going to have to get in way before ICO, and then sell to all the chumps who buy once it hits the market.
Penny coin pumps
This is a current market mechanic that many, myself included, are very salty about. It’s one of those thing, where in hindsight we should have seen it coming and made a killing. Normies have been entering the market for a while now, and it makes sense that when you have thousands of people that know nothing about crypto, they’re going to pick the “cheap” coins. People want those 100x gains that others have gotten, and they don’t think they’ll be able to get it with the bigger coins. This will eventually come to an end, but who knows how long it can go on for.
Alts pump when bitcoin goes sideways
I think people in these markets are addicted to crazy gains, I know I certainly am. It gets boring when you’re not doubling your money every week, so when bitcoin stalls people get their money into other coins to get that dopamine fix again. I think this is a trend that will persist for some time to come, as we’re all collective junkies for huge gains.
Look alike coins
Another market trend I’ve witnessed many times is that when one coin pumps big, it’s often followed days later by coins with similar tech. This happened very recently with ripple and stellar, and there are a host of other examples. I think this is a trend that will likely continue although lessen as investors become more savvy and begin noticing that many look alikes are not all they’re sold to be. For example, people got a taste of this with the recent XVG privacy fiasco, and are learning that while many privacy coins look alike, few actually offer real privacy.
And here are some of my predictions for this year.
XRB will emerge as the coin for inter-exchange transfers
I have accounts on around 8 exchanges, and I must say that no matter how many times I send or receive cryptos from exchanges, it always makes me extremely nervous. Waiting around for hours while my money is in limbo is terrifying, and causes me a great deal of stress. Right now we’re seeing a very rapid growth in exchanges listing XRB, and I expect this to continue and greatly accelerate this year. Once it’s on most exchanges it’s only natural that it will become the preferred method of moving money between exchanges. And, once it’s the preferred method for moving money between exchanges, I expect to see many more XRB pairs, which will further drive adoption. It could well become the traders coin. This of course, is all assuming someone doesn’t figure out how to attack the coin and destroy it, as the tech is still not battle hardened.
NEO will jump up the ranks
One main promise of crypto was to be able to do financial business outside of the realm of government controlled currencies. One of the biggest uses for this we saw this year was in ICOs, and they’re coming to NEO very fast. I think NEO will trace a trajectory similar to what ETH has already done as we see an exponential increase in the number of ICOs on the platform. A crypto economy that supports high value financial business like venture capital via ICOs is going to have a lot of demand, as ETH has already proven.
ETH with go to $2k-$5k
There is tons of stuff in the pipeline coming out, including PoS, which will give more incentive for people to hold. ETH still has one of the biggest developer communities in this space, and this will help drive innovation. It’s also becoming a secondary safe haven coin to BTC and many big holders will be parking their money in it.
Coins without fundamentals may die
Or they may not. As much as I want scams like EOS to die off, the fact is that many of these coins raised hundreds of millions during ICO, which gives them runway to burn for years to come. As long as they can keep conning people into believing in the dream, it could go on for years. However, I do expect to see some of the worst offenders shaken down the ranks, like BTG.
Thoughts on Bitcoin going forward
The sense I’m getting is that a lot of new money entering the market isn’t that interested in Bitcoin. They see it as dated tech without the chance to get them 100x gains. So, I think for a lot of small time investors entering the market that aren’t very knowledgable they will mostly buy other coins. However, if you’re looking to park a lot of money in crypto (millions) you really have no choice but to use the bigger coins like Bitcoin and Ethereum. I think we’re going to see more big names coming out saying they’re buying big chunks of Bitcoin, just like Peter Thiel did. Also, I think we’ll see a lot of people taking profits from alts and putting it back into bitcoin, as a lot of people are reluctant to cash out and deal with the tax man. The optimism in the market right now is driving people to keep money within the ecosystem, which makes a store of value coin like Bitcoin very useful.
I think we’ll start to see lighting get rolled out this year, and eventually see a shift in the tide of thinking Bitcoin is dated and past its prime. I expect to see $40k-$60k for Bitcoin by the end of the year. In my mind, it’s value proposition is still huge. It’s the one and only battle hardened crypto that has stood the test of time. If lightning can succeed, it will make a rock solid base layer for the crypto economy.
My strategy going forward
I’m a bit burned out on hyper focusing on the markets for the last 9 months, so I’m going to be doing more holding in 2018. I’ll be holding most of my portfolio in BTC, ETH, NEO, XMR, and XRB. I’ll be on the lookout for novel technology to invest in, but staying away from most business tokens. I’m interested in investing in open platforms/protocols, and I think in the long term that’s where the most money is to be made. Of course, you can make much higher percent returns chasing the latest hype, but quite frankly I’m tired of that game.