Find the simple and managed resources

2018 was a year devastated for the cryptocurrency market, moving from the festive highs of December 2017 to January, and falling from that point of grace ever since. Now, with December 2018 gone and gone, we are reminded both in the present and in retrospect of the fact that the cryptography market has actually decreased by 80%.

All this despite the fact that there has been a good deal of good news coming from cryptocurrency and the blockchain world, with a number of institutional companies and investors involved in the market with even more to follow.

So while the fundamentals have remained relatively the same, it is here that individuals prove rather irrational in the way they approach the market; we see it with developments – where the news is followed by an overwhelmingly negative reception by investors.

So, what exactly is this irrational model guiding? We can describe it as a form of information asymmetry among investors.

So when we talk about a degree of asymmetry, it emerges in a number of different ways, an example of this is the degree to which the investor has informed about the market, including if the project has been at the height or less of the high level ambitions it has on providing innovation to both investors and users.

Another, more simplistic measure of this is the complexity of the product, the intrinsic value of the good, the ease with which it is applied.

While there are a number of things inside the blockchain space it can be explained in sentences, such as Ethereum is the answer to the middle men, giving a fairly appropriate description of a system, while being able to provide a version of it that lives up to is something that is a complete challenge.

This is a challenge that emerges for a large number of blockchain products. Especially when considering how much of an unexplored journey it is, from proposing many of these technical features to a white paper, it can prove to be a challenge to ensure that they reflect the characteristics described above.

But in order to ensure that the cryptocurrency market remains less volatile, it is necessary to do everything possible to eliminate variables such as information asymmetry that may arise due to these technical challenges.

Managing complexity: the perspective of investors

When we think of investors in the stock market, we usually think that most of these scrupulously dressed and very well informed investors buy and sell positions with a good dose of foresight.

If we are to believe that this investment area is becoming more and more proletarianized, then the cryptocurrency space is far ahead according to the distribution of information. Looking at the performance of cryptocurrencies in 2018, we see that there is a bipolar attribute to information. What we mean by this is that the majority is made up of those who otherwise are not so well informed about the cryptocurrency, or because they have made the investments they have. In the meantime, a minority has a considerable level of information that takes into account when investing.

This disparity of information shows why the market can be rather irregular; only those who are well informed benefit, while most make themselves financially mad about themselves through emotional acting than logic. But just like the generic markets, there are times when not even logic can save us and markets with the panic of the mentality of the flock. When this happens in the encrypted market, it leaves a staggering level of volatility, which is much more common in Over the Counter (OTC) securities.

The value, or at least the perception of the same is sufficient to motivate the decision-making process in the minds of investors, when we take a large number of investors, we have a pool of people who shape the underlying value of a tangible and digital asset. While the aspects that were true when investing in something like Gold, Securities or Oil 100 years ago may have seen their fundamentals change, the same does not apply to cryptocurrencies.

The Cryptos, on the contrary, have maintained a certain degree of consistency, and this is an important driver for its use as a store of value. Otherwise it is reduced to the acronym of SoV, and that is what makes cryptocurrencies unique from Over the Counter stocks. For many otherwise uninformed buyers they tend to be reactionary; buy low and sell high, earning a profit that they can transfer to a less volatile fiat currency.

On the contrary, those who are more informed will know how to create games in the longer term, and see the value of a cryptocurrency from its mechanisms, ensuring at the same time that they buy at the bottom. These same investors use cryptocurrencies as a vehicle to follow longer expansion and braking cycles.

On projects: follow their complexity

Being the kind of person who has seen the start of companies and projects, to see them grow and collapse, it is often possible to identify those who make too many promises and show little deliveries over time.

Where does this disconnection come from? It is the disparity between the characteristics promised by the company and what remains disparate from the finished product is the complexity that lies behind the cryptographic development process. And it is here that a large number of blockchain projects promise a significant amount from their white paper, they collect a large amount of money from funding, or an Initial Coin Offering, only to find out that the finished product is not at the height of expectations. or it simply never materializes.

This is very similar to the disparity and the situation existing among investors, the projects are in a similar distribution of technical skills; with a small number of projects, making sure that what they provide on a practical level aligns as closely as possible with the white paper they publish. While this is a minority, the vast majority of projects, on the other hand, take the overpromising course on the aspect of the software and its accompanying characteristics. As a result, the development phase requires more complex twists, making it a little redundant or too complex to follow.

For a certain amount of this, the space of cryptocurrency and blockchain is a rather unknown territory, with a large amount of its technology and how to apply it being quite complex. Alongside this, there are only a small number of people who are quite suited to the field to make sense of it and apply it in an innovative and feasible way as a product for investors.

There are a good number of projects out there that make high claims about what they can achieve with their initiative, but with such a small number of people who can take these concepts from paper to practice, it is easy for a company to find itself caught between overpromising and delivering to something that is just impractical.

On the contrary, there are a good number of projects out there that have been financed using some kind of bait and exchange, with the result that their market valuation collapses over time, especially when investors stick to what they are supporting.

Simplifying things: for investors

If you are one of those types of "old dogs", especially when it comes to cryptocurrencies, stop immediately, because there are more ways. to obtain the information necessary to switch from the uninformed to the IN format. Here are some of the simple lessons to keep in mind when going through the implicit complexity of blockchain / cryptocurrency projects.

• Be skeptical: for those who are offered something on a silver plate, the best method is to never trust them. Wherever there are extraordinary statements, they will need some pretty mind-boggling evidence to cash in those theoretical checks. If they can not provide them, then try to find someone who is outside looking at the project and what opinion they have on it. Try to understand as much as possible about the project and evaluate whether or not it can provide.
• Make sure you do your homework – There's no alternative out there doing homework when it comes to a blockchain or major cryptocurrency project before you start throwing money in it haphazardly. This may take some time, so this is where reason must prevail over emotions, since research can mean the difference between a good future investment and dumping money in a well. Considering some of these questions, are there any other types of projects that serve that niche in a more effective way? And what distinguishes this specific project? If you can answer these questions well, then you may have a winner.
• Average cost of the dollar – This is not something that is common in the world of investments in the world of cryptocurrencies, but remains an effective financial strategy when it comes to ensuring a management tool to monitor purchases and measure profitability. Having a dollar cost The average calculation system allows you to measure and make regular purchases over a longer period of time. This changes the way investors approach cryptocurrency, rather than buying as much as possible when it reaches a low value with a certain degree of panic, in one that can be done through continuous purchases of a certain amount every week or month, etc. . much more in terms of rationality to your crypts purchases.
• Psychological frequency – Periodizing within the cryptocurrency markets is something that is not commonly seen in any other market, so this is a unique attribute. Where this is taken into account is the instillation in the minds of people who, investing in a cryptocurrency, the investor should keep in mind that it may take some time before the market reaches a point where your investment will produce profits. quite significant. The moment we are living in this moment is interesting and has a great resemblance to 2014; where the highest points are gone and gone, and is in a state of clearance for the whole year. The share of the lions of 2015, has seen the combination of Bitcoin and US Dollars, has reached two hundred points, and has proved a mature market for the purchase of Bitcoin. With the similarities between 2018 and 2014, there is a strong possibility that 2019 will be practically the same as in 2015.

For projects – Finding simplicity

Complexity is the only problem companies and projects have to overcome, especially when it causes an open crevice between what you promise and what you can actually offer. To navigate effectively, here are some tips to follow

• Do not overdo the features – As a newly developed company, it's easy to get caught up in the optimism of what you're trying to do, or feel pushed to promise more to entice potential investors or to attract as much capital as possible from financing of the A series or an ICO. If you are not interested in being in the market to look like a fool in front of your potential investors, for God's sake do not overpromise. The priority is to decide whether or not there are features within the project that are achievable with the team of developers you have, the money you have, including the timeframe. As long as you can realistically answer all these questions, with some leeway for delays or sobs along the way, then you can promise it. If you can not, simply do not do it.
• Avoid unnecessary complexity – So, once you've been able to track what's feasible regarding the elements, mechanisms and promising features of your projects, or have you otherwise made a strategic change of position to face a technical obstacle to progress , respect this rule for as long as you can, avoid complexity. The chain of blocks and the cryptocurrencies that can be associated with it are quite complex without adding even whole other levels. So it is essential to avoid it wherever possible, largely to prevent the development team from becoming prematurely gray. The less it is in the blockchain space, the more fluid people are with the complexity they have on a fundamental level, the more they can be put into operation, and the more substantial product that can be put into practice.

So in conclusion

Working closely with your team and with the blockchain community and cryptocurrency in general, this ecosystem can take many big steps forward in order to eliminate market volatility, as well as preventing the avoidable loss of ambitious projects. The greater the understanding we have collectively, the easier it will be to create substantial technology and easily educate newcomers, leading to mass adoption.

If we want to believe that 2019 has the potential to be like 2015, it will be a year of consolidation of the market for developers and investors, which will lead to the overcoming of malicious and fraudulent projects. These fundamentals have not changed much with the passage of time, which means that it is easier to get used to what they have to do. If we are right in this theorizing, then 2019 will see cryptocurrency rise again to the top.