What is the Value of Cryptocurrency?
So a lot of people in the crypto world are probably wondering whats going on with the market right now.. But as I always say, pay no attention to the market... Instead, lets open our minds and ask the important questions like... What is the actual value of cryptocurrency? Not sure what this question means? Let's think about it a little more here...
Why must I use your currency/token instead of using BTC or ETH as a form of payment?
Because it's the only coin accepted as payment to do _____.
Because it has better scaling long-term.
Because of faster transaction times.
Because of the PoW/PoS incentive.
Because of privacy.
Because of lower fees.
All of the above.
In my opinion none of the answers above reflect any value. This is one of the reasons why 95% of the assets in the market will fail. People are launching ICO's left and right knowing these assets hold a value of $0 because it's just too easy to deceive and/or manipulate investors in the crypto market. These people don't care if you lost your house, spent all your savings, or can't afford medical attention because you're now broke. These people are after one thing... your money.. Hence the saying 'Don't spend what you can't afford to lose.'
Now when you look at the underlying technology of an asset you must ask yourself.. 'Why does this asset hold a value?' If you consider incentives, scaling, speed, fees, etc... as marketing excuses, what do you have left? If there is anything left, it would be the service itself. Even the service itself often can't justify an advantage other than asset's exclusivity. For example "Because you must use our asset to purchase ____________". Which again is still not a viable reason..
Keep in mind it doesn't matter if an asset is $0.10 cents, or $10... in crypto, the underlying business will still operate without issue and in fact the business itself can still prosper regardless the price.. The price of an asset has no major impact especially to large corporations which are already well funded in the real-world..
Okay so let's go over what we may have learned so far...
It's easy to deceive and manipulate investors.
Con-artists/scammers care about 1 thing... Money. (Not your well-being)
'Long-term scaling, faster transaction times, pow/pos incentives, privacy, fees, etc...' adds no value to the asset.
'Asset exclusivity' does not give an asset value.
It doesn't matter what price the asset is, it has no impact on the underlying business and doesn't even hold the same valuation as the underlying business.
So what is the value of cryptocurrency? Currently there is no clear answer on what the 'value of crypto' actually is. It will take time for the market to mature which involves more regulations, tight restrictions, AML/KYC requirements, more oversight and so forth.. All of this of course can't happen overnight and there will be bubbles throughout the entire process.. (such as the one we are in now)
Now keep in mind a business doesn't necessarily care if their crypto asset is $0.10 cents or $10 today.. They are more focused on the underlying business model for the long-term. Just like investors, they invest for the long-term. If we worry about what the price of an asset is in the short-term we will overlook what's actually important and how to achieve long-term results.
I wrote some posts on 'Why I Am Holding ____.' so let me briefly explain why I have invested in these assets for the long term.
NEO - Other companies/assets can and likely will build on top of NEO.
RLC - Other companies/assets can and likely will build on top of RLC. (View decentralized applications running on top of iExec.)
WTC - Other companies/assets can and likely will create sidechains.
TRIG - Other companies/assets can and likely will create sidechains.
LMC - Promotes the use of cryptocurrency in the real world by acting as a bridge connecting the two worlds - ultimately revealing the true value of cryptocurrency.
These are not the only assets that act as a foundation for companies.. One in particular (I'm sure you've heard of) is Ethereum. There are over 35,000 Erc20 token contracts on the Ethereum blockchain. (RLC and WTC are Erc20 tokens)
If you've noticed, most assets I'm holding are essential parts of the blockchain infrastructure.. These assets lay out the foundation for future companies and clients to 'build on' in order to achieve what was once previously impossible or un-affordable. Without the underlying infrastructure in place, then a lot of apps, dapps, goals and dreams wouldn't be possible. So with that perspective, perhaps you could see why I believe these assets are severely undervalued long-term.
Nobody can say for certain what the 'cash value' of cryptocurrency is or should be... the question everyone should ask today is.. Does the asset have any value at all?
Regards,