Investing in Crypto: Go Long

To invest in crypto, learn how it works, and start actually using it.

If you’d put your Holiday bonus into Bitcoin, you’d have doubled your money by now. If you’d bought Ethereum instead, you’d be up 3,000%. Bitcoin, Ethereum, and the growing number of altcoins in the market have all rallied over 150% since January.

However, most money flowing into these currencies today is speculative. Some are calling it a bubble – with talking heads on TV covering Ethereum, and regular people “investing” in cryptocurrency to make a quick buck. While this buying activity drives up the price of Bitcoin and Ethereum, it’s also causing more price volatility in both directions. It is time to rethink cryptocurrency investing, with the goal of contributing long-term value to the ecosystem, not propping up the price bubble.

Screen Shot 2017-06-22 at 9.29.44 AM.png

Both cryptocurrencies are their own ecosystems, with Bitcoin’s acting more like a digital gold, and Ethereum acting as a platform for smart contracts. So, if you believe these technologies have a place in our future, you should be regularly buying bitcoin and then using it as a payment when possible – buy lunch with bitcoin, send your friend money with bitcoin, etc. Bitcoin’s market cap gets the most attention, but it’s transaction volume, another key measure of adoption, is mostly overlooked.

Ethereum is a little different – by allowing people to build new cryptocurrencies on top of smart contracts, it acts as a platform for enforcing the rules. If bitcoin is digital gold, Ethereum is more like a digital form of the US government.

With a more flexible and modernized programming language, Ethereum has made headway with multinational companies alongside the growing startup ecosystem. These players can build their own coins and sets of rules on top of Ethereum’s technology – like a “white-label” cryptocurrency.

Some interesting projects on Ethereum’s platform include:

  1. SlackCoin – an artificially intelligent chatbot that rewards employees for certain behaviors. Want to incentivize information exchange? Open communication? Boost efficiency? Set up SlackCoin. SlackCoin is an alt-coin incentive to be the employee you’d want on your team.
  2. FileCoin – The AirBnb of hard-drive space. Have an extra 500GB? Rent it out to the network and get paid in FileCoin. Then when you need to borrow some later, you can spend your FileCoin instead of buying a new hard drive.
  3. KYC-Chain – A virtual wallet to authenticate your identity. Instead of doing know-your-customer from scratch every time you open a financial account, all institutions can refer to the KYC-chain.

There are dozens of new applications being produced on Ethereum every day. Like Bitcoin, investing in Ethereum means investing in its real-world applications. If you’re putting money into cryptocurrencies with the goal of converting it back into USD for a quick profit, you’re not investing, you’re gambling.

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s