An Introduction and Hopefully Divorce From CryptoCurrency

Most people know the story (legend) of Satoshi Nakamoto. SN is credited with the creation of Bitcoin, which was the original CryptoCurrency. The basic idea, is that Bitcoin uses a type of technology called block chain. Block chain is a decentralized ledger system, where Bitcoin exchanges are validated by people called miners, who perform mathematical calculations to validate Bitcoin transactions, that basically create a series of connected blocks. No one is actually sure if Satoshi is the actual person responsible for Bitcoin. However, many people around the world, use Bitcoin to exchange goods and services. Following Bitcoin, was the creation of 'Smart Contracts' by a platform called Ethereum, who also released their own CryptoCurrency called Ether. Several years later, there are more than 1600 CryptoCurrencies.

The idea is that a technology project will be proposed. They range from global currency exchanges, efficient transfers of data minutes, on-line casinos, even the cannabis industry is involved. Block chain technology seems very inviting, especially to the rugged individualists among us, who want to escape reliance on banks and their stringent rules. Some of the project ideas are actually very interesting. Once a project idea is thought of, and basic financing is arranged, a management team will be assembled, and an outline of the project will be written to entice investors, called a 'white paper'. Some white papers are well written, and outline a plan with benchmarks, and appear to have been designed by someone with professional presentation skills. Unfortunately, many white papers are twice as long as they need to be (over fifty pages) show no signs of presentation skill, and seem to lose sight of the difference between a technology minded audience, and the perspective investors they hope to connect with.

Some of these projects are actually very interesting. However, the concern I have, is that there is a general lack of sophistication in the trading world, and the Crypto markets seem to encourage a cult-like mentality, where people jump into large positions and create portfolio's, on the idea that a Market 'must' go up. The only thing a market 'must' do is take your money and redistribute it to those who have more. I've spent time in Crypto forums, and the lack of a basic understanding of support and resistance, Fibonacci patterns, etc was alarming. 2017 saw the takeoff of Bitcoin, which made it a very attractive investment to unsophisticated investors. However, when you show Crypto bulls the inverse relationship between the Crypto market, and the US Dollar, you will often hear silence. What is even worse, is that the decision to take Crypto positions, seems to be based solely on the perceived merits of the project, without any regard for 'buying low' or at structure / support. While I respect the ideas of many of these projects, I have yet to be convinced that the Crypto markets offer better opportunities than, Spot Currency, Futures Contracts, Equities, or Options.