Should We Fear The Crypto Bear?
I don’t think we need to fear the crypto bear. If the crypto bubble bursts, it may be the best thing to happen in a while. There is a story underneath this madness, and that’s where the real magic is.
Let’s look at my current favourite piece of madness:
- A mockCoin has reached nearly USD$1.8Bn (CoinGecko) in market cap (as of 08JAN2018). Dogecoin – I don’t know if it is pronounced “Doggy Coin,” but the whole thing was created as a joke. It has no real-world merit – though it is used for tips on the net – but come on. This coin was made as a joke – and has even attempted to continue the joke (e.g. initially limited to a capped supply of 100Bn coins, they shifted to INFINITE supply) and then stopped development (it’s been two years).
Do You Fear The Crypto Bear?
Pundits everywhere are talking about the massive growth in crypto or huge crashes – the crypto bubble bursting – leaving some in fear of the crypto bear market.
However, some more prominent minds are still looking at a possible continuation. Naval Ravikant, for example, sees institutional investors and some solid underpinnings as potential props to the bubble.
If we are lucky, there will be a flight to quality. If not, then a massive pump followed by a dump.
— Naval (@naval) January 8, 2018
I agree though my best view is that the real projects – the Innovation that Naval speaks about – are where the real value is. I commented, and Naval agreed (liked – that’s about as much as one could hope). Institutional investors have begun to see through some of the madness and are investing in the underlying technology organizations. This is powerful, and I believe it shows that some of
Agreed. I fear the flight will decrease the valuation for quality initially, but in the long-term that’s a good thing. https://t.co/uRHmWN4KC5
— Darrell O’Donnell 🇨🇦🆔 (@darrello) January 8, 2018
On the flip side, a business colleague Jamie Burke (author of 99% of Blockchain Startups Are Bullshit) of Outlier Ventures (disclosure: Outlier and the VC I consult with have some joint investments), is feeling much more negative. But still, the underlying value of the companies and ecosystems drives Outlier Venture’s whole investment approach. They are long on the ecosystem play.
All the people I respect in #crypto are of a negative sentiment about the market right now…
— Jamie Burke ⛺️ (@jamie247) January 8, 2018
This may be a good thing as focus shifts to where real value is and the companies and organizations that are doing something concrete get attention.
— Darrell O’Donnell 🇨🇦🆔 (@darrello) January 9, 2018
The bottom line for me is that the underlying capability drives real long-term value. The companies and organizations taking advantage of what blockchain and similar technologies can do are changing the face of the internet and business. The fact that a particular cryptocurrency – or a whole basket of them – may tank when the bubble bursts may be a good thing. In the long-term.
Should you fear the crypto bear? That depends on your view.