July 24, 2024

Will still be

At the moment when everything was gone, everyone died and went bankrupt (well, they didn't, okay, but for the most part they lost andthe main thing of the promised breakthrough growth did not happen), it is strange to write an optimistic text.

The volume of own investments in crypto is verysmall, and if she does die, I personally will hardly be hurt from this. Those. there is no need to engage in self-hypnosis, as crypto enthusiasts do, who put everything on the crypto industry. But I will write why I think that there will still be. And it will be good.

I'll start from afar. I mined my first cue ball in the 12th year. And sold them in the 14th for a thousand bucks for a cue ball. There were not many, but after two months the cue ball was already worth two hundred and fifty. Maybe I didn’t pay off from below, but then it was the right trading decision. So I saw a rapid drop in bitcoin 4-5 times five years ago. And there are people who have seen such falls live not once, but more. But even those who mined in the 12th, there are extremely few, and those who saw what happened before, generally two times, and miscalculated. Why I write this will explain later.

In the meantime, let's try to estimate how muchcrypto should cost in general. Not specifically one coin, even the grandfather of the cue ball or some of the most super-tech of the new ones. In general, what may be the capitalization of all this circus. As a guideline, I suggest taking Internet technologies and separately evaluating them at the peak of the dot-com boom, and then falling and the subsequent long-term recovery.

Why internet?In my opinion, this is a close and in many ways similar story.Starting with tulip fever, there have been many examples of explosive growth in the world, which then ended in an irreversible fall.People tend to expect some new horizons, markets, and advanced technologies.Is railroads cool?Is a smoking smoking steam locomotive a reason for hype?And what about the vacuum cleaner, the refrigerator and the TV?! Of course!By the way, it was the vacuum cleaner that caused the crisis of 1929.Well, not the vacuum cleaner itself, but new technologies that promised new markets, new consumption.And these expectations were justified.A steam locomotive, a refrigerator, a car, an airplane – these are all things that we use (well, the steam locomotive is gone, but the railways are).And today, these businesses bring clear, simple and fairly small margins.

But just a quarter century ago, the same hysteriawas with the internet. And unlike the bubble of steam locomotives, most of us personally remember how it was. When a site with an empty page "homeless-dot-com" could cost a million dollars. Exactly a year and a half ago, the company that added the word blockchain to its name quadrupled its value on the stock exchange. Now the Internet is just a means. Any hairdresser, shoe repair, or some rutabaga farmer has his own website and that doesn't mean anything. Better to have a refrigerator than not to have. But the refrigerator is not an object of delight and lust.

But let's get back to the price again.At first, Internet companies skyrocketed, then fell, and then quietly reached the levels at which they were at their peak.Let's try to estimate the cost of blockchain technology based on a comparison with the Internet and the dot-com boom.Right now, we have no way of understanding what kind of capitalization the blockchain will have relative to the Internet.It will occupy two, three, five times more or the same smaller share in the economy.In fact, this is the weakest point in my reasoning.But I just take it as a starting point that its value for civilization and the economy for ordinary people will be comparable.What gives me the right to think so?

The blockchain has so far two and a half key technological advantages:

1.BlockchainIt is possible to throw out banks, brokers, intermediaries, exchangers, payment systems.You can almost instantly make a transaction to Korea, Zimbabwe, Antarctica, the ISS.And at the same time, compared to ordinary bank transfers, it is really three kopecks to pay.It is not tied to the amount of the transfer.

2.Anonymity / "Big Brother is watching you". It may seem strange, but it's about the same thing.same. Crypta, or rather Bitcoin, arose, among other things, as an anarchist challenge to the world of large uncles in suits, a call to the state: "we will make our money past your banks." And the crypt has found its niche in this regard, especially the criminal one.

But blockchain is not only anonymity, it is alsoand global transparency of all transactions. And it seems like big uncles in suits will find a way to make the crypto world entrance anonymous - KYC, identity, transaction tracking. This is a much greater level of control than before. And although this contradicts the original concept of financial “flower children”, it is also a huge source of value for this technology. Already, different coins give a different degree of anonymity, and at some point the crypt will be divided into “white” and “black”. And if this happens, then the value of blockchain for the economy will become enormous and undeniable. And its full legalization can happen extremely quickly. So these are not two separate points, but one and a half.

Therefore, take as a starting point that crypt andInternet markets of comparable scale. In the first quarter of 2000, NASDAQ peaked at $ 5.1 trillion at its peak. A few months later (by the fourth quarter of 2000), 2.3 trillion remained of it. Those. more than half of capitalization burned out in a very short time - a value quite typical for a crypto world.
But just to say that then it was 5 trillion and today it will be5, False.

Firstly, the dollar in 2001 is not the dollar in 2019. Inflation, no escape from it. So the estimate of $ 5 trillion can be increased by about 1.5 times.

SecondlyStrange as it may seem, but at the dawn of the Internet, there were essentially no Internet brokers.To invest in the market, you had to be a client of a traditional broker.To do this, you had to have free funds starting from at least ten thousand dollars, and most brokers had an even higher entry threshold - twenty, thirty thousand.This already greatly limits the number of players who could participate in the dot-com "madness".In addition, financial markets were essentially available only to the representatives of the Golden Billion – Americans and, to a lesser extent, Western Europeans.
There are no such restrictions for investing in cryptocurrencies.Any Filipino, Moroccan or even, God forgive me, Ukrainian canBuy a few satoshes, pieces of ether or some other coin you like with your twenty dollars.So we can safely double the estimate again.In total, with not very rigid assumptions, we get an estimate of about 15 trillion dollars.

Today, the capitalization of all cryptocurrencies is about $250 billion.At the moment, this is how much it costs, for example,Verizion communications, which occupies only the 21st place in the US market.It's many times over.Microsoft($1062 billion),Apple($988 billion),Amazon($883 billion).Moreover, even at its peak, the entire cryptocurrency did not exceed $800 billion, which is less than the capitalization of Microsoft alone. Tell me, have you heard that for two years people have been enthusiastically discussing Amazon as en masse as they are discussing crypto?

There is never any money on the classic exchangewhich are painted there — shoulders, derivatives, small free-floats: no company can be sold on the exchange at the current price — selling any portfolio of any significance will collapse the price.

And the crypto market is still virtually unregulated. Dozens of “exchanges” have no licenses, regulators, or any control. And that trillion, which was at its peak in January 2018, is much more “drawn” than in traditional markets.

So what do we have? A very interesting and promising technology andtwo years of discussion everywhere. Shown to everyone is the story of crazy growth and the same crazy fall. And absolutely ridiculous capitalization, even at its peak, is not what it is now.
I see only one explanation.The years 2017 and 2018 were a promotional campaign for crypto. From a world that few geeks and professional speculators knew about, crypto has become publicly available. A huge number of people have never heard of crypto before, but they were shown a story of success, then fall and disappointment. The vast majority did not go crazy, did not shout “Tuzemune”, did not buy crypto. But the fact that it exists was conveyed to almost everyone. Those who didn’t buy last time and calculated how much they would have earned when the crypt rose, said to themselves with relief later, “Well, it’s good that I didn’t enter, everything fell.” But regret that I did not explore such an interesting topic settled among many. Eh, if only I had known, I would have bought it then.

Therefore, when the crypt begins to grow again andwill update the highs of 2018, a lot of passengers will break into this train. Those who did not buy a ticket last time. They have already been told that such a fall is not the first time, there is nothing to be afraid of, if something bad happens, then it will still be even cooler then, stay out. And they will stay out.

Crypt is a bubble. He will burst and wash away most of the hamsters that have not even begun to breed. And when this happens, the crypt will become a “steam locomotive” - the usual accessible and mass technology.

And one of those projects and coins who will remain,already exists now, as existed in 2001, most of the current information companies. So when the bubble bursts, everything will become as always. But so far he has not even pouted. They didn’t start to puff him out. It was just an MVP demo. Still will be.