Category: ICO

What game is Facebook playing?

On By mehranmuslimiblogIn Blockchain, ICOLeave a comment

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I can tell from a quick review of the main crypto press outlets online this morning that I’m not the only one puzzled by Facebook’s decision to reverse its crypto advertising ban. Why now and what is Facebook up to with this latest announcement? It seems like progress, even though advertising ICOs or binary options is still prohibited.

The Facebook crypto ban confusion

Going back to January 30th when Facebook announced its ban, because of “misleading or deceptive promotional practices,” we were somewhat confused then. On the one hand, Facebook had imposed a blanket ban on any cryptocurrency and/or ICO advertising, yet Mark Zuckerberg made public statements pointing to his personal interest in them. He said: “There are important counter-trends to this — like encryption and cryptocurrency — that take power from centralized systems and put it back into people’s hands […] I’m interested to go deeper and study the positive and negative aspects of these technologies, and how best to use them in our services.” I think the key element of what he said then is “how best to use them in our services,” suggesting to many onlookers in the crypto community that Facebook’s ad ban wasn’t quite so much “for the greater good’ as for “the good of Facebook.”

And now we’ve been taken by surprise with this latest announcement. (No doubt, Twitter and Google will follow, since they followed the FB ban.) It may have a positive effect on the crypto markets, which have been taking a battering for several months now and who can forget that Bitcoin’s price took a hit right after Facebook announced the ad ban. That’s one possible positive that might come out of this — at least it will be good for cryptocurrency owners.

Crypto ban lifted — just a little

So now we are in a situation where cryptocurrencies can be advertised again on Facebook, but not ICOs. And before we all jump for joy, look at what Facebook also says in its on-site statement — only pre-approved advertisers will be ‘admitted’.

Facebook says: “Advertisers wanting to run ads for cryptocurrency products and services must submit an application to help us assess their eligibility — including any licenses they have obtained, whether they are traded on a public stock exchange, and other relevant public background on their business.”

Facebook is still in control

Therefore, Facebook still has all the control. And it hasn’t explained why it has made this U-turn on crypto advertising. Consequently, theories about what the media giant is really up to are sprouting like daisies. Carlos Grenoir, CEO of Olyseum suggests Facebook’s ad ban reversal could be selfishly motivated: “The reasons for Facebook reversing its decision to ban crypto ads are not clear, but the motivation could have something to do with its own strategy regarding the evolving crypto space.”

Others, like WhalePanda, a respected voice in the crypto markets, believe it has more to do with Facebook losing advertising revenue. Cointelegraph, a company that suffered the effects of the ban reports, “The posts which have been put forward for review by Cointelegraph have become stuck, and are not being confirmed, nor denied by Facebook, during the ban as well as after the ban was ‘reversed.’” Basically, it is still a confusing space for advertisers who want to boost posts.

We don’t know what Facebook’s vetting process and while it looks like a positive move from the crypto community perspective, Facebook needs to come clean about what exactly they are doing, because for the moment it looks like it is playing a game, and one that it hopes to win by any means.

Is Trilliant offering a new form of ICO?

On By mehranmuslimiblogIn Blockchain, ICOLeave a comment

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In a move to serve the growing consumer demand for cryptocurrency tokens, tech business Trilliant is launching 500 ‘next generation’ ATMs in Europe, which should be fully operational by the beginning of 2019. Trilliant is a Swiss-based company that started out as Crypto Capital AG, but now focuses on ATM operations, having moved away from being an investment platform.

Currently ATMs don’t have the facility to purchase cryptocurrencies using fiat currencies, but the new ATMs rectify that situation. Surely, this represents a leap forward for cryptocurrency, especially with regard to mainstream adoption.

What Trilliant is offering is a way to promote stability in the marketplace. Its goal is to have at least 500 ATMs operational by 2019 — a goal that doesn’t seem overly ambitious considering that the next generation ATMs offer more value to cryptocurrency investors than the 2,700 cryptocurrency ATMs currently in-place across the globe.

Founder and CEO, Sebastian Korbach said: “In the long run, we want our machines visible on every corner, creating greater awareness for cryptocurrencies in general.”

It is also offering investors the opportunity to purchase Fractional Ownership Units. These units cost upwards of $100 and will be sold on the Trilliant website. Essentially it means that investors will be able to purchase partial ownership of Trilliant’s operating cryptocurrency ATMs.

Is this a new type of ICO?

This is different to an ICO, the fundraising platform that is more typical for blockchain and crypto projects. A Fractional Ownership Unit is similar to a profit sharing agreement, which means investors stand to benefit from Trilliant’s profits. However, it is still holding a token sale and has a whitepaper — so isn’t it an ICO in another disguise?

This raises some interesting questions about the ICO landscape in the future. Is the basic model that emerged in 2017 simply that — a basic model? Will we see the ICO develop different formats, such as this Fractional Ownership concept. Fractional Ownership is by no means a new thing and it isn’t just connected to the cryptocurrency ecosystem — you can have fractional ownership of vineyards, racehorses and supercars. What other formats are likely to emerge and how will this test the strength of the regulatory frameworks for crypto ecosystems and token sales?

We have only seen the tip of the iceberg with ICOs — there is undoubtedly much more to come in terms of this fundraising tool.

Is crypto’s 2018 a total washout?

On By mehranmuslimiblogIn Bitcoin, Blockchain, ICOLeave a comment

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So far, 2018 hasn’t been the best year for cryptocurrencies. The bearish sentiment that followed the euphoria at the end of 2017 seems to be running the show, but is this the end of cryptocurrencies, or merely the downside that comes before a resounding turnaround in fortunes?

Yoni Assia, CEO of eToro believs that selling your ryptocurrency now is like selling Apple stock back in 2001, when it was falling in value. It is easy to see why many people are selling off their holdings, especially if you didn’t get into crypto s a long-term investment, but if you do take a longer view of the market, then perhaps there is a good reason to hold on to those crypto assets for a while longer and see how it all plays out.

If we look at Bitcoin’s past trends, it doesn’t seem over ambitious to claim that there is likely to be an upswing towards the end of 2018. If that happens and you sell now, then you stand to lose money.

ICOs are the real ‘bubble’

Assia told Business Insider that one thing to look at in the crypto market is the number of startups issuing tokens in ICOs. He believes that “95% of them will end up as nothing, because that’s startup funding.” What he means is that the majority of tokens will simply fade away, leaving the strongest ones to lead the crypto market. These are probably going to be Bitcoin, Ethereum, Litecoin and a few more.

Dominik Schiener, creator of IOTA said earlier this year that he expects less than 10 of the 1,400 crypto projects that have started in the last year to survive. That’s quite a radical figure.

Neither Assia or Schiener are sceptical about crypto; they are both supporters of the sector, but what they are saying is that as with the dotcom era, many projects will get funding but not survive. However, those that do are likely to transform the world and make their investors big money.

What Assia is really saying is that it is ICOs that are ‘the bubble’, not cryptocurrencies or the blockchain. Many of them simply aren’t viable. But their demise will pave the way for true cryptocurrencies to succeed in the future.

We may not be in quite the same situation as Apple stock holders were in 2001, but it has a ring of familiarity. Still, if we remember that correctly, after that massive sell-off, Apple’s stock went on to gain a staggering amount of value, and who is to say that crypto won’t do exactly the same. It might look like a washout at the moment, but give crypto time and you might be glad you held on to your assets.

The East-West ICO Divide

On By mehranmuslimiblogIn Bitcoin, Blockchain, ICOLeave a comment

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The saying “East is East and West is West” curiously even applies to ICOs. You might have assumed that there was a universal view of ICOs, but it isn’t so: in the West, enthusiastic support for an ICO is primarily based on the ‘ideas’ that the ICO platform brings to the blockchain party, while in the East they are much more concerned about the ICO’s ability to generate a return on investment.

The divide exists in other ways as well. For example, the Asian market took off on its own, informed by the ecosystems around bitcoin and ethereum but also distinct from them. Zhuling Chen, co-founder of Aelf, a cloud computing startup based in Singapore, attributes this to the fact that, “At the very beginning, the information coming from Asia to the US was very limited. We didn’t know what’s really going on.”

 

The differences between the Asian and U.S. ICO markets became more clearly visible during Blockchain Week in NYC. Brady Dale, writing for Coindesk says:

“If one common theme ran through our conversations about Asia, it was this: retail and institutional investors all want returns to realize much more quickly than investors do in the U.S., which may help explain why it has always had a vigorous ecosystem of exchanges.”

Another Asian investor explained it more succinctly: “Asians love to gamble.” Jason Fang told Coindesk:

“They don’t want long lockup periods like so many Western projects expect. Instead, they want to see tokens get released, listed and realize some of the gains that come from retail investors and market makers buying into a new coin.”

Another view, according to Ricky Li of Altonomy, one of Asia’s largest crypto funds, also pointed out that Asians want in and out quickly, and that they have a tendency “not to diversify their portfolios over time.” He also said:

“Chinese companies and their neighbors will raise funds in ether and largely maintain those positions, sometimes failing to lock in gain or riding volatility through their whole portfolio.”

A lack of software documentation in Asian languages has been another divider between East and West. But overall, it seems that the demands of ICO investors are quite different, and ICOs trying to please a global audience will need to take this into account when building their roadmap and strategy.