Hello Everybody,
I am new to Leo Finance. This is my second post. My first post was on Financial Goals 2021. I have degrees in Economics, Business, Sociology and Accounting. I worked as an Economist at the Department of Labor measuring inflation which is the change in the value of money over time. I am fascinated by watching all of these Cryptocurrencies because they act as "natural experiments" that answer some of the key questions of money. I have also studied the history of money and this is an exciting time in history.
I am also interested in Blockchain technology more broadly as this technology can be used in applications other than currency. Blockchain is a distributed ledger technology (DLT) and as a person who studied Accounting I find it interesting since accounting can be thought of as a centralized ledger technology--if you want to call it a technology.
From a business perspective I am curious to see how the blockchain space evolves. To me the blockchain space is like the new Silicon Valley being created right in front of us. In Silicon Valley right now the currency is dollars and the gatekeepers are VCs. There is an opportunity here to build a more decentralized Silicon Valley where the currency is trust and the gatekeepers are the community and the blockchain itself.
The way this experiment plays out will tell us a lot about society and I have hope that we will use this opportunity to rebuild a more broad based and more inclusive society. I look forward to meeting everyone in the community. Please comment and share my posts. I am looking to engage with as many people as possible.
If you are interested in topics such as money, cryptocurrency, investing, finance, and business please follow me and comment. I will try to respond to everybody, but Resource Credits will limit the speed in the early going.
Also checkout my Financial Goals 2021
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This is very true and there are a few very interesting years ahead of us for the early adopters. We get to watch it all being built in front of our eyes and see it rise and fall in real time.
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The early adopters get to earn and stake hive first, but I fear that this staking mechanism can be exploited by the ultra-rich. These ultra-rich folks are already "staked" in the current "fiat" economy, but they can just take their dollars and buy a ton of Hive Power and use that to give themselves undue influence on this Hive platform.
They can use dollars to concentrate and centralized power in a platform that is supposed to be decentralized and you saw that with Steem. That is how Hive was born. A person (Sun) with a ton of money bought Steemit and had a disproportionate influence on the Steem blockchain and so we forked. Will people just keep forking over and over?
The root of this staking problem is a deeper technical issue with the consensus mechanism in Hive and an issue with the consensus mechanisms in the blockchain universe in general. This technical issue is also a more universal issue.
It is this ancient battle between centralization and decentralization and you see this battle play out in every sphere both social, technical, physical, biological, economical, etc. I will write a long post about this.
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He did but he also bought cheaply beneath the counter to gain that influence. An option that isn't there today and would cost a lot more in the open market. The longer that we are in operation as a blockchain, the more decentralized that it becomes as stake spreads further and wider making it harder to buy a majority. Still possible but less probable.
There have also been further protections added since the hardfork to prevent exchanges influencing the chain which is the real cause of his takeover. Without their stake it would not have happened the way that it did. It will be interesting to see how it all plays out over the next few years but i do think that people will realize the need for alternative options to the big companies that are creating a powerful monopoly over social media these days. It's a dangerous path to follow unless people begin to change their habits.
I agree with you. Facebook financial started as a company that monetized your attention and used it to direct your purchasing behavior which made Facebook really rich, but now the social media companies and the rest of the big data companies are using your attention to drive your voting and political behavior. These platforms are also allowing people to create tribal identities at scale and with grave political and physical consequences. I see QAnon as a tribe. They have a religion with their own mythology and it is directing real behavior and some of it is violent.
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Welcome to the community again. I studied engineering but through my interest in crypto, I've learnt a thing or two about economics, finance and all that. I 'll be looking forward to your insight from a professional perspective. Do you have any experience in day trading stocks, forex or even crypto?
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Thank you for your support. Without it, I wouldn't even be able to respond to these comments. My background in economics doesn't lend itself well to day trading. It is better served in stock portfolio construction, economic development and policy design, manufacturing or sales optimization, or even blockchain consensus design.
A lot of day trading today is momentum investing and sometimes this actually goes against economic models. For example, most economist would probably say that Tesla would be a better investment than Bitcoin. I would have said that. This would have been my analysis:
TSLA holds a dominant position in a new technology that will disrupt cars. Bitcoin is not the best money and its not even the best cryptocurrency. Its one of the slowest blockchains. It has high fees. Its difficult for normal people to use. The value of the coin is volatile and its not broadly accepted as a form of payment. TSLA has a self driving electric car that is fast and everybody wants one. However, if you invest in Bitcoin from the beginning and TSLA from the beginning you would be richer if you invested in Bitcoin.
Here is what $10,000 in TSLA would be worth since its IPO (June 29, 2010):
$1,841,817
Here is what $10,000 in Bitcoin would be worth since its ICO (January 3, 2009):
$1,317,970,908
“There are two kinds of forecasters,” said the economist John Kenneth Galbraith. “Those who don’t know and those who don’t know they don’t know.”
I know that I don't know :)
I think I can turn this comment into some type of short post on Leofinance
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I had to double check that it was a comment after reading it. In both instances, it is under the assumption that the $10k investment was held until now.
Statistically speaking, I don't think there are that many people who actually held Bitcoin since it's origin because as you've pointed out, it doesn't even do anything and isn't the best kind of money. However, with TSLA, there has been a clearer path from the onset and a very good head leading to project, so there seemingly is a higher chance of someone holding TSLA stock for the long haul.
Makes for an interesting post and investigation though. You could even check wallets of the oldest bitcoins(basically by tracking wallets with least activity) and comparing it to any data you can get about TSLA stocks to get the average profit made by either investor.
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I actually made mistake on the date for the comment. That figure that I gave you for BTC was not even all the way back to ICO. I push the back button all the way back and it actually only went to January 1st, 2011. If you go back to ICO, BTC makes even more money.
The fact that Bitcoin doesn't do anything makes economist hate it even more. Warren Buffett hates gold for the same reason. Gold doesn't do anything. The big thing I wanted to highlight is that the investment world can be strange and economics as a science tries to be rational, but the markets aren't always rational.
"markets can remain irrational longer than you can remain solvent." -Keynes
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I've been striving to grasp the madness. I see some projects with little or no use-case with high market cap and then real projects like Hive and Steem that actually contributes something have shitty value. It is perplexing.
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Well in this case Economics can provide some answers. For Steem and Hive the problem is the supply and demand of the coin. The staking mechanism / consensus that rewards (supplies) out coins is not in balance with the demand. The central question is why would you buy Steem or Hive? I think the logical answer would be so that your upvotes and post will earn you more tokens and you will have a larger influence when it comes to voting on the future of the platform. The more people bring in outside money into the platform the more the value of the Hive or Steem token will rise. The problem is the supply keeps getting created faster than people want to buy it.
Demand side for the people buying Bitcoin is different. A lot of the large investors in Bitcoin are institutional investors that are buying Bitcoin as a hedge against inflation. A lot of the gold crowd has also exited gold and moved into BTC. Many of the people who buy Bitcoin don't really interact with a broad range of other crypto products. All they know is Bitcoin and that they think it will just keep going up. They are really people who are just currency speculators that are trying to momentum invest. They aren't in it for the long term.
The supply side of BTC has a cutoff so people believe that there will be scarcity. That is not the case with Steem and Hive. Steem and Hive seemed to be printing money indefinitely and there just isn't enough demand. Leo on the other hand is pretty smart. The wrapped Leo allows it to be traded more easily on other networks and Leo is creating other products that should drive demand for the coin and that is probably why Leo is worth more than Steem and Hive on a per coin basis.
If I had to take a guess from my experience, I would say that 90% of the crypto market will fail because many of the projects are redundant and the market doesn't have room for more than one of those products in the long run. Just like nobody wants to use the second best social network or search engine. In some places there will be room for competition.
Such as the coins that will be used for remittance. There could possibly be two players in that market or more. Just like there is Western Union and Moneygram in the United States, but who uses Yahoo to search and who uses MySpace as a social network?
This fits in the broader theme of centralization vs decentralization. In some markets there are only one or two players and in some market there are thousands and there always will be thousands. So when you invest in a market its best to try to make a determination of what the state of competition will look like.
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This is pretty straight forward to me. So the issue is about creating demand for a product rather than just relying on "upvote and earn" as your marketing slogan. I've not actually read the whitepaper for Hive but the fact that it can be printed indefinitely certainly won't bode well for the traditional investor.
What do you think is the long term potential of Hive?
!ENGAGE 50
ENGAGEtokens.