12 ms·
Bancor has lost more than half its value since June ICO
- danblick 9y agoVolatility in cryptocurrency-based securities? I am shocked, shocked.
- tibbon 9y agoCompared to volatility in fiat currencies? I (perhaps incorrectly) assume you live in a relatively stable and developed nation that hasn't seen hyperinflation? Should I base my views of fiat currency from things like the 79.6 billion percent hyperinflation in Zimbabwe? Neither is inherently volatile. Both can be, but it isn't a built-in trait of fiat or cryptocurrency.
- Fej 9y agoPerhaps cryptocurrencies are inherently volatile. We don't know either way. In any case, there is zero empirical evidence that they aren't, given that there has not once existed a stable cryptocurrency.
- sebleon 9y agoIn most of the developing world, hyperinflation is rare too.
- tradersam 9y agoNot really. Zimbabwe, Yugoslavia, Hungary, China (1945). It's not rampant, but it's not rare.
- tibbon 9y agoVenezuela has been pretty bad off recently too.
- sebleon 9y ago3% of countries is a small minority. (6/195 countries, you missed Venezuela-now and Ecuador-1999) Besides, these tend to happen infrequently (like once in a century per country), people underestimate risk, and blame politicians instead of the system. It would be beautiful if a critical mass of people would come to the conclusion that monetary system needs to change...
- rublev 9y agoWhat? This is like every shit coin. Tons of them tank to near zero and deflate. Anyone who thinks these coins are legitimate are fooling themselves. They are built with one core requirement, do just enough to differentiate from other coins, pump it, get out. The average person can't understand 99% of the specs of these coins, it's all speculation. The whole thing is a ponzi scheme.
- Karunamon 9y agoJust because some ICOs can be scams is no reason to write off the entire concept as a scam.
- user5994461 9y agoThe entire concept is a multi level marketing scheme.
- Karunamon 9y agoAnd this reductive reasoning can be applied to the stock market or for that matter any cryptocurrency - that doesn't make it right.
- kryptiskt 9y agoNo, when I buy stock the company has obligations to me as a shareholder. There is nothing but disclaimers if I buy into an ICO.
- 6nf 9y agoCompanies listed on the stock exchange are actually out there making things or providing services, employing people, and making money. Anyone and their dog can start an ICO with nothing but a website filled with fluff and bullcrap.
- whataretensors 9y agoNo, not all of it. It only appears that way before looking into it more.
- virtuexru 9y agoWhy not name the coin in the title? Bancor.
- gumby 9y agoIn this case the more general title is superior. I, for example, had never heard of bancor so wouldn't have clicked on the article.
- mason55 9y agoI mean, you could write "Bancor, One of the Most High-Profile Initial Coin Offerings, Has Crashed 50%" Then it's informative to readers who know what Bancor is and those who don't.
- joosters 9y agoI'm sure Bancor couldn't care less about their token price collapsing. They've already got all of the "investors'" money. In fact, they could just walk away right now instead of carrying on developing the system. The brave new world of ICOs offers no protection against companies failing to follow through on their ICO roadmap. Maybe Bancor could use the token collapse as an excuse to quit now?
- everdev 9y agoThe SEC might say otherwise. There are plenty of civil and criminal options for recourse if they simply "walk away".
- s73ver_ 9y agoThey're based in Israel, though. What does the Israeli SEC say about that?
- 21 9y agoIsrael recently banned offering binary options to foreigners because a lot of such companies were based in Israel and I guess a lot of people complained to Israeli authorities about being scammed, and impacted the country reputation. https://www.timesofisrael.com/the-wolves-of-tel-aviv-israels-vast-amoral-binary-options-scam-exposed/ https://www.timesofisrael.com/the-wolves-of-tel-aviv-israels...
- elorm 9y agoWhat's the SEC got to do with this? Bancor isn't a US company
- dahdum 9y agoBancor plummeted right after the ICO. It's still above it's all time low, so it's not exactly a new thing. https://coinmarketcap.com/currencies/bancor/ https://coinmarketcap.com/currencies/bancor/ There were plenty of warnings and research about how flawed their product is, including here. The lesson, as always, is caveat emptor.
- chroem- 9y agoMost alts are traded in terms of BTC. Bancor's dollar value has only ever gone up because increases in the price of bitcoin have occasionally offset Bancor's losses relative to BTC. Bancor's value relative to BTC has been monotonically decreasing since its ICO, which is a feat unto itself.
- dmix 9y agoThis sounds like the market correcting itself. It sounds like a good thing to me. No one is pretending ICO's are a mature market.
- whataretensors 9y agoEhh, my 3d printing stock fell to about 10% of its value. It happens in every market - just make sure you are diversified... especially if you are investing in high risk markets. Edit: I'm probably getting downvoted because I'm comparing IPOs to ICOs. They are significantly different and everyone should beware of scams.
- conanbatt 9y agoMore like the model you seem to explain is too naive and exploitative by people just snake-oiling thousands of things, since by diversification you sell all of them.
- emmab 9y agoWhy do so many cryptocurrency projects seem so meta? Platforms for creating platforms, coins for creating coins.
- distrill 9y agoBecause that's where the money will be. Being a piece of the infrastructure means you don't have to care about how particular coins are behaving, as long as the market as a whole is moving up so are you.
- curiousgal 9y agoI just googled it and the description says The Bancor protocol enables built-in price discovery and a liquidity mechanism for tokens on smart contract blockchains Talk about buzzwords and mumbo jumbo.
- tradersam 9y agoIt's an over-technical way to say they don't really do much.
- scottlocklin 9y agoIt's pretty standard finance bilge that means "auction."
- hcarvalhoalves 9y agoThe new derivatives.
- jononor 9y agoEasier to sell to people trying to make a quick buck than doing something concrete that is directly useful. Why sell even shovels directly at the goldrush when you can manufacture the shovels...
- vkou 9y agoOr write a whitepaper about how you will build a factory that will build factories to manufacture shovels. I'm, ah, seeking investors.
- acidreflux 9y agoWhat’s half of zero? Oh yeah. Zero.
- velcro 9y agoICOs are more akin to angel/VC rounds than IPOs - you often invest in a idea thats still not fully developed and might need 1-2 years to come out on the market. The huge difference to traditional investing is that shares/tokens are immediately tradable and small(ish) crypto investors have 0 patience to wait those 1-2 years so they often sell early and crash the price to go looking for another get-rich scheme. Thats a curse of the ICOs - but also a benefit. As an investor you get to assign value to something immediately and have the freedom to terminate your investment (something very difficult with traditional angel/VC rounds) and sell the tokens. Its also a fascinating marketing strategy - some of your crypto "investors" are early adopters, promoters and users of your tech - even more so because they're vested in it. I'm not defending the ICOs (especially the over the top ones) - but lately there are so many articles that don't really try to understand the concept. And so many people automatically equating temporary loss of value with scams. Internet and cryptos are moving at the speed of thought - but the rules are still the same - startups need time. In all fairness - Bancor is still a very young project. Also a fairly promising one - many projects already using it: https://www.reddit.com/r/Bancor/comments/75b7us/list_of_all_known_projects_committed_to_using/ https://www.reddit.com/r/Bancor/comments/75b7us/list_of_all_...
- the_stc 9y agoVery few ICOs do right by investors. We're one of the few offering equity positions and dividends. The law conveniently provides an excuse to them, see Tezos even outright calling it a donation! As an EJC the laws don't apply in the same way, so we directly offer shares in our startup. Few ICOs are willing to do the ethical thing because they're just cash grabs. Hire a small team to try to make your whitepaper vision into code. If it fails and you were not too far fetch in using company funds, nothing bad will happen to you. It's disgusting.
- velcro 9y agoYou could say the same thing about "traditional" startups though - investors often invest just based on the combination of the idea, founders/team and maybe an early prototype. If the startup fails - nothing "bad" will happen to you either. Shares in a startup thats not publicly tradable don't really offer you that much security. Unless you've committed fraud - but - I've been following the ICO market closely for the past 6 months and I can't remember any of the larger ICOs that were outright scams. Many people and smaller projects/websites will of course try to scam you online - but you should always do your own research and due diligence still applies. I'm not sure I'd agree that "very few ICOs do right by their investors". It depends what you mean - there have been many successful projects out there that made people money. But if you mean "flipping" i.e. buying into a ICO just to try and sell it quickly for profit - that seems more difficult these days. But it might also be due to the current BTC rally. ICOs are of course still in wild west territory as far as regulations go - there is a reason why Tezos calls it a donation. They don't want the regulatory hurdle. In fact almost all ICOs these days force you to accept that tokens are not shares in the company and don't "officially" entitle you to anything.
- Arathorn 9y agoI did quite a lot of research into Bancor from a non-cryptocurrency-developer perspective a few months ago (when looking at possible ways to launch a token for Matrix - c.f. https://matrix.org/blog/2017/08/22/thoughts-on-cryptocurrencies/ https://matrix.org/blog/2017/08/22/thoughts-on-cryptocurrenc...) - and concluded that it's actually quite an interesting idea (once it finally 'clicked'). From the normal dev perspective: the idea is that it removes the concept of using a marketplace to exchange between currencies entirely; instead it replaces the exchanges with an algorithm which gives a consistent global way to calculate the FX rate at any given point. The formula used is mathematically very simple: you allocate a 'reserve' of your currency to be backed by a 'base' currency (by default, their BNT); and as folks buy and sell your currency it algorithmically defines the exchange rate relative to the base currency based on the total supply of your currency in circulation. So rather than the exchange rate being determined by the human interactions of traders, instead it's determined by a function of the current market cap - and everyone is held true to using the same function because it's part of the codebase that defines how the currency operates, running as a smart contract on the Ethereum VM. From memory, the function itself defines the FX as being proportional to the amount of token supply relative to the reserve, after applying a selectable exponential damping factor. The code is kinda interesting, as it ends up implementing some fairly scary fixed-point exponentiation in such a way that it can run on the EVM with the reversibility and predictable rounding errors which are required for small transactions to cause tiny but 'correct' changes in the FX rate for that currency. https://github.com/bancorprotocol/contracts/blob/master/solidity/contracts/BancorFormula.sol https://github.com/bancorprotocol/contracts/blob/master/soli... has the gory details. Now, the idea certainly does have some controversies, including: * It requires some kind of common currency to be able to work, and Bancor positioned themselves as the common currency for that purpose (hence their ICO). That said, you could also chain together separate 'common' currencies though, or just access a Bancorified network of currencies via an old-style exchange. * Whilst the formula used to calculate the FX seems sensible enough, it's not obvious it's the only (or optimal) solution, but it's very baked into the system. (Although the contract does have a backdoor to let it be upgraded in case of bugs or problems, which is a bit controversial in and of itself). * It's an interesting question whether it's a feature or a bug that markets have a human function which can act emotionally/irrationally - rather than behaving 'perfectly' through the magic of a shared smart contract. On balance, it feels like a very interesting system for managing small-scale tokens - especially ones which need liquidity and stability beyond their natural market cap. However, this is a slightly niche market which is still evolving (relative to everyone who's running around trying to do as large an ICO as possible), so it's perhaps not surprising that it's yet to take off. (Disclaimer: I'm not working with/for Bancor, although have chatted to them a few times.)
- bandrami 9y agoThe spot price has fallen by more than half; the value has held very steady at zero.
- dna_polymerase 9y ago> Bancor Chief Executive Officer Guy Benartzi said Sirer is making his claims because he is advising another company. That really says it all. The CEO prefers to attack ad hominem instead of responding to his very well substantiated arguments. Bancor is BS and a perfect example of the whole ICO scam thing.
- unabridged 9y agoSo what, GRPN fell to 1/5 of its IPO price in its first year.
- josephagoss 9y agoMost people in the scene were warning people away from Bancor due to the large amount of money being raised. Generally large raises will result in a massive fall regardless of the teams performance short term. Also it was never clear how their token fit into the future of the CryptoCurrency ecosystem. It always seemed like an ICO-token without a purpose, looking to invent one. Thing is most of these dapp ideas would gain a larger network effect and be more efficient just by using ETH.
- jondubois 9y agoCryptocurrencies were created to allow people to opt out of society's current power structures. That might explain why Bancor, a cryptocurrency backed by traditional power brokers doesn't work as a cryptocurrency.
- decentralised 9y agoBancor's been plagued with some technical problems that have been exploited by miners and hackers to front-run their algorithm. The explanation for the losses are related to the price stabilisation / automated market making algorithm being exploited while in its early infancy. I'm really sad at the reactions people on HN have to Blockchain businesses and topics, but I am confident this is a case of horse-traders dissing on Ford Model T. It's like the SV crowd is finding it hard to believe no one wants another social media uber for X whatever now that the money and the spotlight are shining on communities very far from your own.