Half of ICOs Die Within Four Months After Token Sales Finalized • Hacker News Board

Re: Half of ICOs Die Within Four Months After Token Sales Finalized

#411

Post by Captain_Usher » Wed, Jul 11, 2018, 12:37 AM UTC

themagician wrote: post #189

Captain_Usher wrote: post #83

Earlier quoted context omitted.

An ICO is an "Initial Coin Offering", it's supposed to be like an IPO except instead of offering shares, you're selling cryptocurrency coins. ICOs are usually framed as a way to fund a project or business, usually related to cryptocurrencies or blockchain technology in some way. The idea is that the project's success will increase the value of the coins you bought and you'll be able to sell them for more later. The m…

Is the company required to buy back the coins? I’m not sure I get the point of an ICO. It seems like a company issuing monopoly money. It even seems like this would have been possible before crypto—literally just Monopoly money to people and let them trade amongst themselves. I guess Monopoly money is easy to duplicate… but so is crypto in a way because you can just start your own currency that uses the same block ch…

The "monopoly money" perspective isn't wrong, and in general an ICO for a coin that's, say, "bitcoin but a little different" doesn't make much sense. Bitcoin is supposed to be a currency, so an ICO for something bitcoin-ish is like taking investments for a new kind of dollar. You have to get them into circulation somehow, and trading currencies like commodities is a real thing, but it doesn't really explain the current ICO hype.

It makes more sense if you look at most of the ICO tokens from the ethereum point of view, rather than bitcoin. Ethereum and its derivatives let you use tokens as components of distributed applications. Unlike a "pure" currency, which is useful only as a medium of exchange and has no intrinsic value, these tokens let you use the distributed application so they're worth whatever the application is. They aren't really currency, although you can usually buy and sell them and they're used to give the application some kind of market behavior.

Something like filecoin is a better example. The filecoin project intends to build a distributed storage system. If their project succeeds, the filecoin network will let you exchange coins for the network's storage, and storage is valuable so the coins are valuable too. Ideally, they'll use the funding from selling coins in an ICO to make the project so useful that a coin's worth of access will be worth more than what you paid for it during the ICO and the people who participated come out ahead.

Personally I'm still not very impressed with most ICO projects, but at least all of them aren't completely insane when you look at them this way.

Re: Half of ICOs Die Within Four Months After Token Sales Finalized

#412

Post by gwern » Wed, Jul 11, 2018, 2:01 AM UTC

gwern wrote: post #170

NathanCH wrote: post #51

Earlier quoted context omitted.

Forget money, I would like to know of one legit ICO. One single ICO that has a product. One.

Augur is launching its finished distributed prediction markets product today. We'll see if anyone uses it, but that's an ICO with a product.

Currently up to 98 contracts with $27.1k wagered: https://predictions.global/ It'll be interesting to see how much it keeps growing.

Re: Half of ICOs Die Within Four Months After Token Sales Finalized

#413

Post by airstrike » Wed, Jul 11, 2018, 8:12 PM UTC

zackmorris wrote: post #403

airstrike wrote: post #334

Earlier quoted context omitted.

> But it was really yet another tactic to keep the most lucrative forms of trading in the hands of wealthy/institutional investors and leave the masses in the slow lane of trading with their own money. This is entirely subjective and it actually also happens to be wrong.

That's the great thing about subjectivity, I could say the same thing about your comment unless you have proof that no day traders were negatively affected. BTW I got interested in this sort of thing after this law blocked the start of my day trading career :-P

You're the one making the wild claim without proof, so our comments are not the same. The burden of proof is on you.

I don't have to prove that day traders weren't negatively affected. In fact, even if one of us proved they were affected, this wouldn't support the argument that the intention of the bill was "to keep the most lucrative forms of trading in the hands of wealthy". That's just unsubstantiated hot air.

Most importantly, you haven't even proven that day trading is "the most lucrative" form of trading and that's probably an even wilder claim! While the burden of proof is on you again, I can already think of two reasons why it is incorrect: (1) day trading incurs in significant transaction costs due to the frequency of the trades and (2) though you may get outsized results on a given trade if your gamble pays off, it's just speculation so it will never beat the market on a risk-adjusted basis. Unless you're a hedge fund with significant resources to take on huge positions and minimize transaction costs, there is really no easy alpha left in the market. Everything's already priced in these days.

Re: Half of ICOs Die Within Four Months After Token Sales Finalized

#414

Post by lurker456 » Wed, Jul 11, 2018, 10:34 PM UTC

herval wrote: post #277

lurker456 wrote: post #249

Earlier quoted context omitted.

How would you send fiat to a family member stuck in Venezuela ? I agree that the value of cryptocurrency is hugely inflated, but it's not zero either. It's a good fit in some scenarios.

You could (and people do) send gift cards, or pre-paid debit cards. These have the added benefit of being accepted in stores, etc, whereas cryptocurrencies... not really?

Anything of value sent via snail mail gets seized. CC and bank accounts denominated in USD can't be used. There is a black market where people pay with physical USD and crypto.

Re: Half of ICOs Die Within Four Months After Token Sales Finalized

#415

Post by wpietri » Thu, Jul 12, 2018, 3:44 AM UTC

darawk wrote: post #397

wpietri wrote: post #356

Earlier quoted context omitted.

I appreciate your willingness to at least contemplate that Bitcoin might have flaws, which is better than most Bitcoin advocates. But you share one of the habits that makes these discussions so frustrating. You substitute marginal examples and handwaves at the future when asked for clear present evidence. The Lightning network might possibly one day increase capacity to infinite TPS. It doesn't yet, and reasonable pe…

> You substitute marginal examples and handwaves at the future when asked for clear present evidence. Such is unfortunately the nature of all predictive discussion. I don't think i'm being any more speculative than anyone discussing say, autonomous cars, or similarly 'somewhere on the horizon' technologies. > It doesn't yet, and reasonable people think it never will. E.g.: https://reddragdiva.tumblr.com/post/17541838…

That is not at all the nature of all predictive discussion. Handwaves suit for a seed round, for example. But when you're looking for an A or a B round, you need significant evidence for your forward-looking statements. Bitcoin is years past the point where it deserves to get away with handwaves.

Also, "people use cryptocurrency for value transfer" is not a forward-looking statement. It's a statement of what people do now. And this comes out of you saying, "blockchains are useful now".

Re: Half of ICOs Die Within Four Months After Token Sales Finalized

#416

Post by wpietri » Thu, Jul 12, 2018, 3:46 AM UTC

Animats wrote: post #406

wpietri wrote: post #360

Earlier quoted context omitted.

I agree that it's a decent approach for that extremely narrow use case. My point is the extent to which that is different from the peak of XML's hype cycle, which was circa 2000. Then, XML was everywhere. E.g., eBay circa 2004 would render data internally as XML, which would get passed off to multiple Rube Goldbergian XSLT transformation layers on its way to becoming HTML. Or I did some work at a bank around then, an…

JSON tools tend not to scale. See [1] A 1MB JSON file will blow up some tools. Engineering models of real-world objects are much larger than that. There's sort of an assumption with JSON that you'll read it into a JSON tree and work on that, not process it sequentially. [1] https://news.ycombinator.com/item?id=12063626

I'm willing to believe that's currently true, but that doesn't strike me as much of a moat for XML.

Re: Half of ICOs Die Within Four Months After Token Sales Finalized

#417

Post by wpietri » Thu, Jul 12, 2018, 3:53 AM UTC

CryptoPunk wrote: post #404

wpietri wrote: post #363

Earlier quoted context omitted.

Having lived through 1985, most people did not think email was silly. Even we primitives of that dark age could tell that instant delivery was generally better than waiting a few days. Moreover, the "most people" standard does not apply. I'm not asking what "most people" think about Bitcoin. I'm asking for evidence of delivered value to early-adopter audiences. In 1985 any crowd of tech people could tell you why emai…

I believe the most common reason some people don't see the utility of cryptocurrency is that they have a real or perceived vested interest in the status quo around money not being disturbed. It is often the case that: Securities lawyers and traditional venture capitalists don't want a world where regulatory agencies and traditional venture capital can be routed around. Those in financial law enforcement don't want th…

The problem with this line of thinking is that the people most strongly interested in keeping financial transactions away from the prying eyes of government are criminals. Criminality is strongly correlated with negative-sum interactions with society, and that tends to provoke a response.

So if the best cryptocurrency early-adopter audience is people who are harming society, then you've pretty much guaranteed that cryptocurrencies will remain societally marginal.

Re: Half of ICOs Die Within Four Months After Token Sales Finalized

#418

Post by wpietri » Thu, Jul 12, 2018, 3:55 AM UTC

cubano wrote: post #382

wpietri wrote: post #262

Earlier quoted context omitted.

> That really depends on where you put 'beginning'. It does not. In 1995 the Internet was useful for 30m people. In 1985 it was useful for 30,000. Email was better than paper mail from the get-go. Networked file transfer was way better than mailing magtapes or CDs. Remote terminal connections were way better than driving or doing long-distance dialup. The Internet was not the wonder it is today, but from very early o…

My personal bet is that blockchains will be like XML: a technology that was going to be The FUTURE for a while, got put into a bunch of things... That's an outstanding analogy, one I had not considered before, but certainly XML is far less..err... includable is perhaps the word(?)... into a software project then a blockchain-based datastore and verification would be, right? Let's just hope a XSLT-like companion to th…

Intresting! They strike me as equally includable. It's easy enough to do XML-based persistence, or XML-based messaging between nodes of a distributed system.

Indeed, Jabber, an XML-based protocol, is seeing new life as a big IOT protocol. My cheap robot vacuum spends its day hanging out in a chatroom and communicating via XML, for example.

Re: Half of ICOs Die Within Four Months After Token Sales Finalized

#419

Post by babaeth » Thu, Jul 12, 2018, 10:31 AM UTC

hudon wrote: post #23

You can see the state (volume, # daily users) of some of these promised "dapps" here: https://dappradar.com . It is indeed a barren wasteland. And when a new popular ICO comes along, the Ethereum network struggles and fees skyrocket. It's weird because people compare it to the early days of the Internet... but the early Internet was useful from its beginning: you could at least send messages and files across the netw…

dappradar offers a very limited view of the activity on the Ethereum Blockchain. You should look into projects like Golem, it shows a great use case for the Blockchain and definitely justify an ICO.

Re: Half of ICOs Die Within Four Months After Token Sales Finalized

#420

Post by babaeth » Thu, Jul 12, 2018, 10:38 AM UTC

CaptainZapp wrote: post #148

darawk wrote: post #98

Earlier quoted context omitted.

> It's weird because people compare it to the early days of the Internet... but the early Internet was useful from its beginning That really depends on where you put 'beginning'. But more to the point, blockchains are useful now, just like the internet was. They're just not useful for all the things that are being promised (yet). Also, just like the internet wasn't. > Now, all we see is rampant fraud and a complete d…

But if you think it's all a fraud, or that there is no value, then you're just not thinking very hard. Seriously: Where is the actual value of crypto currencies? I can see specific (limited) applications for the blockchain. But you assert that people (who may have thought long and hard about the utility of crypto currencies) are lazy thinkers. At the very minimum you could provide an argument instead of throwing arou…

You should look into projects like Golem (https://golem.network/home/), it allows people to use the blockchain to perform complex calculations such as 3d rendering or training machine learning models.

This is a great use case for the blockchain but you may have missed it if you only read Techcrunch articles about CryptoKitties.