A few days ago I stumbled upon Covesting. I was immediately excited. I had done no research and was pulling out my wallet begging them to take my money. I thought, "what a great idea for people." A majority of people getting into the market now have very little understanding of where to put their money. With Covesting, they can invest, diversify, and feel safe knowing they are following a professional, or professionals, who understand the market - all without the FOMO.
I'm in. I probably need to diversify, too. I could use some more understanding of the market, too. I have FOMO, too.
Covesting is a great idea. In theory. Kind of. Maybe. Probably not. I don't know.
This is where I think people can help/answer my questions.
The "what if" future...
What if the top investor(s) manipulate the market? Could a country?
This is how it works in my head. They have hundreds, thousands, millions, of people following them - all of it done by a computer, without the chance of someone stopping them. What stops them from moving their money to one coin only to immediately move it back? This could cause a chain reaction of millions, if not billions, of dollars flooding from one coin to the next.
Let's give my example.
The top investor takes everything he or she owns and floods LTC (Litecoin) - hundreds of millions follow. This causes an uptick in LTC. That same investor turns immediately and moves everything to to a low market cap shitcoin with his/her spouse or friend sitting there with money when they flood the market. Boom. A cool quick mil. Yes, their reputation might be over, but their wallet isn't.
Whether spouse, friend, business partner, top investors working together- or shit, even a country - what's stopping this? Money is moving freely with the choice of one (or multiple) investor.
What happens at "cash-outs"?
What happens when the investor you follow cashes-out for fiat or a stabilized crypto? Does yours? If Covesting truly becomes big, which we hope (why take part in the ICO if not?), could the top investors be in-charge of the market? Could they have the power to take the market down if they all cashed out? Could an entire country purposely manipulate the market?
These are the main questions I have - maybe you can answer. Will it ever get that large? Will it even ever see day 1? Am I catastrophizing an improbable scenario? Are there fail-safes in place?
Anyway, I'm off to invest regardless.