It’s Ivan here, one of the co-founders of www.hubrisone.com
It’s a short post, but a timely one in light of the recent market sell-off — something is underlying happening and we need to take note.
The first wave of projects, coins, and tokens have paved a way for new businesses, projects and use-cases to learn from the mistakes that were made.
These mistakes, in hindsight, seem extremely obvious however is always near impossible to predict.
A few things I have personally learned from last year explosion of projects and how they have negatively impacted token price:
1. Lack of token utility
Thousands of coins/tokens were created based off paper-proven business models, these models were unsustainable and more importantly, the tokens had near zero true utility
2. ICO token economics
I find it truly has-dripping that investors still buy tokens prices above $0.05 in an initial coin offering.
An ICO is supposed to provide early investors an opportunity to purchase coins or tokens at a discounted rate prior to the mass public. With some projects pricing tokens for $0.50 and up, how do investors plan to generate a reasonable long-term return? After the ICO the only direction for a token price so high in the ICO stage is (you guessed) down.
3. Hype
Do not let big marketing dollars cloud your investment judgment. PR Releases, large telegram groups = does not equal a great project or business. If the crowd is going one direction. Stop. Think. And go and do your own research or find a hidden gem.
4. Projects with no sustainable business models
2017, saw a flurry of various projects, however, I realized most white papers of these projects, especially token based projects did not have a sustainable business model, and their primary goal was to generate funds from 1. ICO 2. Token price — if you look at points 1) and 2) you can see why this would not work.
The best sustainable way forward is for projects to put their business hats on and think how can they incorporate tokens into a sustainable business model, for example through customer acquisition.
Going forward we (as a community) need to incorporate this into projects going forward.
Adoption is the next phase and that means we need to put our commercial, business and technology hats on. Some of these tokens will die — and rightly so.
Safe investing.
Ivan
Originally published at HubrisOne Blog.
