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I've been dabbling in crypto since the lockdown (all red, but I've had fun) and this space is like the wild west early days of the internet, with even more scam
by puranjay 6y ago
I've been dabbling in crypto since the lockdown (all red, but I've had fun) and this space is like the wild west early days of the internet, with even more scammers. We're past the heady ICO days but now, all the scams have moved to Uniswap.
And I might be guilty of being elitist, but I rarely, if ever, see founders with A+ tier credentials (Ivy league education, FAANG/Investment banking/Mckinsey et al) starting crypto businesses.
Most coins are also like penny stocks - the trading volume is so low that a single whale can cause big shifts in valuation, making pump and dump schemes extremely easy.
- mlerner 6y agoThe claim about people with "A+ credentials" not working in crypto is off base. Look at the founders of crypto companies from top-tier VCs like a16z: https://a16z.com/crypto/#vertical-landing-portfolio https://a16z.com/crypto/#vertical-landing-portfolio
- puranjay 6y agoI should have been more clear: new crypto projects rarely have pedigreed founders anymore.
- vmception 6y agothats because they all got their reputations sullied when their projects last decade tanked in price 99% Crypto communities do not understand the concept of secession in an organization, and believe that if you earned revenue then the runway should last forever and you should be married to the project forever It doesnt matter, the same people are launching projects now under different aliases. The market doesnt actually care. There is no way to discern between a project that will screw you over versus one that wont, versus one that will rally 5,000% because that has no correlation to legitimacy or any gatekeeping of checkboxes
- sneak 6y agoRarely, yes, but there are some. I also think you could say "new startups rarely have pedigreed founders". Like any business class, most new entrants try and fail. I like a long tail, because it means there's a better correlation of profit and skill in being able to (sometimes) predict a company's future. When everything is a bit safer across the board, you can't convert wisdom into money at quite the same rate.
- fourstar 6y ago>And I might be guilty of being elitist, but I rarely, if ever, see founders with A+ tier credentials (Ivy league education, FAANG/Investment banking/Mckinsey et al) starting crypto businesses. Spoiler: majority of good engineers never worked at big tech companies or went to ivy league schools. Also, investment banking isn't exactly a shining beacon of trust.
- puranjay 6y agoI agree. But it is a signal, especially in a field filled with as much noise as crypto. When all you have to go by is a whitepaper and a website, past performance of the founders becomes important.
- vmception 6y agoIts not a signal at all. Thats the entire rebuttal. Your premise is flawed.
- puranjay 6y agoHow else do you figure out whether the devs can actually do what the whitepaper promises? Just go by their word?
- timdaub 6y agoI've been navigating the space since 2014. It's not too difficult if you know the tech. Here's some fat tony advice: Good project/founders/devs: - Are tightly connect to other good projects (e.g. check Twitter) - Are shipping features/products continously (and talk about it) - Adjust their vision/roadmap appropriately (crypto changes really quick) - Are value-driven - Try to improve upon difficult but possible engineering problems (e.g. we build a smart contract for a EUR stable coin compared to "we solve remittance for all the unbanked")
- vmception 6y ago
- miguelmota 6y agoWhat exactly are you seeing on Uniswap that’s a scam? Why do you think people need credentials to create a startup if they have a good idea?
- puranjay 6y ago> Why do you think people need credentials to create a startup if they have a good idea? They don't. But good credentials are a signal in a crowded field where most projects are just whitepapers. They might not matter in the startup world where you usually launch with at least an MVP. But in the crypto world, most new coins are just whitepapers. You at least need to know that the founders have the technical knowhow to bring the whitepaper to life.
- miguelmota 6y agoI think it's simply the nature of crowdsourced funding that creates more ideas that get funded, both good and bad. For example, anyone can start a funding campaign to launch a product on Indiegogo and most of the projects on there aren't revolutionary. The same thing occurs in crypto where anyone can invest in a new ideas via a token sale or DAO because crypto is borderless and open to anyone, analogous to Indiegogo projects getting funding from non-institutional investors and many of those projects becoming a flop.
- smabie 6y agoHow could you be in the red? the number of risk free arbitrage opportunities is frankly staggering. Everywhere you look: futures, options, defi, etc there are juicy arbs all over the place. For example, short term btc futures are often trading at 30% annualized basis over spot. By taking on zero risk (except for exchange risk), you can easily capture somewhere between a 20 and 30 percent annualized return. It's just too easy, and many professional crypto trading firms are making in excess of 25% per month with low net crypto delta
- shrimpx 6y agoThe current 24h BTC volume on Coinbase alone is 280M. For comparison TSLA (which is a hot stock) is 60M and GOOG is a miserable 2-3M... I know you said "most coins" and I think your statement is true, that the bottom 90% are shit coins, but the coins that everyone knows trade at higher volume than many popular stock tickers.
- cwkoss 6y agoSounds like you've learned why "hodl" is a meme. Unless you have have insider information or get incredibly lucky, day trading crypto is a near certain way to lose money.