We have all probably read the news about the updated terms for crypto.com bagholders cardholders.
Another passive crypto income has been lost for me as they have scrapped the cashback and destroyed most of the perks of having a card.
The benefits have been too good to be true and for those who got in early, the last 2 years have been a nice windfall.
However, those who got in recently and bought CRO at some of the higher prices are now getting a big rug pull.
As of now at $28,97, CRO is -69,9% from its all-time high. Those with locked in CRO are possibly looking at some large losses as many users abandon their visa cards.
CRO fell over 25% this week from an already weak position
source
For crypto.com, a centralised corporation, the main focus is on maximising its profit and the visa card has been a great gimmick to attract users. Now they can focus more on their exchange business with high spreads and CRO (now a top 10 crypto by Marketcap) can be a purely speculative crypto.
The difference between a centralised and a decentralised system can be seen clearly here with this rug-pull. In order for a token to be successful, it needs a use case and crypto.com has thrown this out in the pursuit of profits. A community and development are also important for success and they have taken a dump on those too.
The use of CRO as a reward for spending with their card was great in driving demand for CRO and new customers. Without this, why would anyone hold CRO except for some staking rewards that they can get out of nearly any crypto? Such as a stable coin with a fixed-to-fiat value to protect the downside.
In a typical centralised fashion, totally missing the upcoming monetisation of everything, I believe crypto.com are taking a step backwards here as the future tells us that we will get crypto rewards for doing literally everything in the future, including spending fiat money (if it exists in the future).
As we have seen many times before, corporations who start off with good intentions, end up cannibalising what made them great in the first place. As an example, eBay was built on the back of an active community, but the corporate money was too much for them to resist and they turned on their community and destroyed what was good about it, the same as crypto.com is doing now to their community.
This is why centralised businesses like Twitter and Facebook are no threat to web3 decentralised platforms, they just cannot compete. The reason for this is that they cannot align the interests of all the stakeholders as web3 does. Shareholders, Managers and Employees' interests are not equally balanced. Add into the mix the corruption from the elite causes destructive tendencies instead of creative tendencies and problem-solving like what you see in community-focused projects.
The outrage from the community caused Crypto.com to soften its changes to some of the biggest bagholders, but it looks like the damage has already been done. There were pictures of cut-up cards and cards being burnt all over social media. The fact that so many changes and so quickly were introduced seemed to come as a shock to many, even though it was all too good to be true.
What to do if you are holding CRO in a loss situation?
With the reduced staking rewards and fewer incentives to buy CRO, there could be less inflation in CRO in the future causing higher prices. So it may make sense to hold onto your CRO and stake further in the Defi wallet at 12% until you go back into the profit zone.
The other outlook could be there is already a lot of CRO in circulation and the exchange business is not enough of a use-case for this demand. Therefore we could see a further devaluation of CRO. For sure there will be fewer users buying and holding CRO and now that it's a top 10 crypto, where will the demand come from?
What do you think is next for CRO?
Thanks for reading.
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Posted Using LeoFinance Beta
Insightful! I did not hear about this news, but a few weeks ago was looking in to the company.
You are right it did all seem too good to be true and so I decided to pass on it, especially because of their high buy in prices. Now hearing this I am glad I passed :-)
True decentralized initiatives for the win!
Posted Using LeoFinance Beta
smart move!
To be fair i don't see how the old system was sustainable in the long run. They have probably reached enough users now that it was becoming unstable.
It's shit for us who use the cars a lot but i can still get my Spotify and Netflix rebate as well as $50 a month for using the card in cashback so it's still a hell of a deal.
ought a new car last week on my card and it payed me back $500 in CRO which i turned straight back into euros and have been spending since.
It was good while it lasted but they couldn't keep printing money at that rate.
I don't see where they are reducing supply other than staking so that does worry me a bit as they are only increasing supply every day.
Posted Using LeoFinance Beta
The returns the last 2 years for those who got in early have been amazing. Perhaps the $70 per month benefits could still be worth it to some if long term the value of CRO doesn't crater.
Nice work buying a car on the card! lol
I did cheat a little on that one. Half was from my crypto earnings but the other 8k was a bank transfer from my real account to my card account and then just used it for the cashback.
Free money is always good. It was an easy way to make $250 by doing one transfer to my crypto.com account. 😃
Awesome, I can see how it can pay off nicely if you can get some big-ticket items on it like holidays etc.
I'm only on Ruby level, so not sure what I will do now.
Probably raise more money they already raised 45 million this year alone so they'll keep creating sponsors to sucker in more people to "buy the dip" rework their tokenomics to encourage more staking to remove supply off the market so they can dump more of their token to extend run way and hope it will be enough to IPO
It's a shitcoin casino why is anyone surprised at their shitfuckery?
Posted Using LeoFinance Beta
I think that many were shocked by how quickly they removed the benefits.
I agree you and lemon made some good points.
But all market is pooped atm.
Posted using LeoFinance Mobile
Yes, it looks like the bear is coming! Good for buying though.
Damn, what a greedy, stupid thing to do. I don't think even Matt Damon will be able to help.
Posted Using LeoFinance Beta
😅😂😅👌
The biggest loss I've seen so far is someone on reddit claiming to have staked $800,000. They've lost $200,000 of value from CRO so far and flipped out when they heard about the (now revised) changes to staking. It does seem like the CRO whales are getting the better end of the deal here.
Posted Using LeoFinance Beta
Ahhh you found THE rug!!! lol
It is choppy waters for the whales right now in CRONOS!
I thought CRO had other utilities like being used to mint NFTs on the crypto.com NFT platform. I know the card was a major reason people got attracted to the token and platform
Posted using LeoFinance Mobile
Yes there is that utility and as a token on their exchange. I'm not sure that is enough for a top 10 crypto though.
the platform has their own blockchain too, and it's not terrible. cro is the gas on cronos network and use case is created by any project that ever launches on cro chain. the rewards were nice, but nothing lasts forever. one month ago, one of my best friends told me that crypto.com was going to go higher than bitcoin someday. obviously that was never even a possibility, but i find it funny that so many people believed this token was a long term hodl, but bail through this. seems like it's time for cro holders to learn actual crypto and start working for yields.
Posted Using LeoFinance Beta
Very true, it was an amazing 2 years for those in early.
It will be fun to see how this plays out.
I do not like them hehe! They screwed us twice!
Posted using LeoFinance Mobile
hehe yeah! they only just reduced rewards 2 months ago!
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Why are people so shitty about this?
This is nothing more than a business decision, made by a business.
A highly profitable business at that.
Good luck to them.
PSA: Just because someone has (CRO) or allows you to interact with (the card) "cryptocurrency", it DOES NOT equal decentralisation.
Posted Using LeoFinance Beta
I'm thinking that because they bought CRO and are fixed for a period of time to hold CRO, changing the terms before the fixed staking period is up is like being shafted.
But you right, it's why we should stick to decentralised systems like Hive.