Blockchain Stocks Collapse by 40% to 90%(wolfstreet.com)
wolfstreet.com
Blockchain Stocks Collapse by 40% to 90%
https://wolfstreet.com/2018/01/25/the-40-to-90-collapse-of-blockchain-stocks/
38 comments
Going public by taking over a publicly traded company is a legit way to avoid the costs and complexity of an IPO. There are examples in the past, the most famous is probably Berkshire Hathaway, Warren Buffett's company.
That said, a proper IPO allows for more scrutiny and it is probably better to read the SEC filings before investing in a company you don't know (and also in one you know). Everyone pretending Crypto is not a bubble should justify this kind of behavior where people are investing based on keyword instead of knowledge...
That said, a proper IPO allows for more scrutiny and it is probably better to read the SEC filings before investing in a company you don't know (and also in one you know). Everyone pretending Crypto is not a bubble should justify this kind of behavior where people are investing based on keyword instead of knowledge...
What's notable but not stated in this article, is that the "collapse" is from peak, almost all are still way up from before their announcement.
A 40-90% retrenchment is terrible. How much demand is from short covering? Is there any indication they are done falling? To not be all rhetorical, I'd say they are not done.
They are not done because the crypto-crowd do this 'hold on for dear life' thing and HODL their useless little coin things rather than sell them. They tell themselves that it is only by selling that they are losing and that these things will naturally float upwards over a matter of time, they just have to not lose their nerve.
Even the worst coin bobs upwards slightly from time to time, so people will sadly be 'buying the dip' and HODLing - to use their own parlance.
The crypto craze reminds me of the London riots in an odd way, people know that this is not normal and that order will be resumed eventually. People then went to great lengths to loot things they could never fence or want for themselves.
The craze is also quite funny because none of these people that are turning up now to buy coin have any faith in the regular banks and city, they have taken the Koolaid and they love it. What happens to capitalism as we know it when everyone takes their dollars and buys these unregulated monopoly money tokens, to disregard normal money as 'worthless fiat'? It is comical, in the same vein as the London Riots of 2011.
Even the worst coin bobs upwards slightly from time to time, so people will sadly be 'buying the dip' and HODLing - to use their own parlance.
The crypto craze reminds me of the London riots in an odd way, people know that this is not normal and that order will be resumed eventually. People then went to great lengths to loot things they could never fence or want for themselves.
The craze is also quite funny because none of these people that are turning up now to buy coin have any faith in the regular banks and city, they have taken the Koolaid and they love it. What happens to capitalism as we know it when everyone takes their dollars and buys these unregulated monopoly money tokens, to disregard normal money as 'worthless fiat'? It is comical, in the same vein as the London Riots of 2011.
Like anything that reaches popular adoption, the ideologues are always an extreme minority. The majority are always people who are in it for themselves, not out of some philosophical purpose. So when it hits the fan, the HODL types are not going to be able to hodl back the inevitable.
It's something I've considered in terms of all economic and political movements. If your movement requires ideological cohesiveness to survive, that's not going to be enough. There has to be an advantage to participation that goes beyond philosophical agreements and extends deeply into the material world. If that material benefit fails to (ahem) materialize, then ideology gives way to practicality.
It's something I've considered in terms of all economic and political movements. If your movement requires ideological cohesiveness to survive, that's not going to be enough. There has to be an advantage to participation that goes beyond philosophical agreements and extends deeply into the material world. If that material benefit fails to (ahem) materialize, then ideology gives way to practicality.
I would argue that the current western capitalist system is ideological.
An anarchist system controlled by a minority of violent mafia gangs would be simpler and more economically efficient... The reason why the world is not like this is simply because most people are willing to make personal sacrifices to prevent it.
A society made up of people who only act for their own self-interest will inevitably be an anarchist society.
If idealism has held together innefficient systems like capitalism, socialism and organised religion for so long, surely it can hold together other systems like cryptocurrencies.
An anarchist system controlled by a minority of violent mafia gangs would be simpler and more economically efficient... The reason why the world is not like this is simply because most people are willing to make personal sacrifices to prevent it.
A society made up of people who only act for their own self-interest will inevitably be an anarchist society.
If idealism has held together innefficient systems like capitalism, socialism and organised religion for so long, surely it can hold together other systems like cryptocurrencies.
I think you're misusing the term "anarchist". Anarchy is to hierarchy what atheism is to theism. It means nobody uses coercive force on anybody else, it doesn't mean people don't work together. There are a few anarchist communes in the US; the people living there carry out construction projects and so forth, so they do work together on things that are mutually beneficial, it's just that they do it without any specific person being in charge.
Members of a mafia also work together. In a society without any absolute centralised power, mafia groups are free to dominate because they'll have the means of enforcing their views whenever disagreements come up. In a society without any centralised power, violence becomes a very effective tool to gain leverage over your adversaries.
Violence is coercive power. So not anarchist by definition.
I disagree, in the sense that western capitalism requires participation even by those who adamantly oppose it. There is no (realistic) way to opt out.
If everyone was purely self-interested, corruption would be much more common because there would be no moral voice at the back of people's minds to hold them back. The only hurdle would be the fear of getting caught.
It's difficult for individuals to uphold laws in a system where everyone knows that everyone else is cheating.
It's difficult for individuals to uphold laws in a system where everyone knows that everyone else is cheating.
I don't think everybody is every purely anything. Self-interest is one of our motivators. Altruism another. Fear of getting caught a whole other. Fear of alienating our peers another. We're extremely complex animals.
But self-interest is why modern capitalism survives despite, on the face of it, seeming like a terrible system. It would be very hard to convince people who had never heard of it to adopt it by description alone. But if you take away their source of food and clothing, and then offer them a wage by which they can purchase them instead, then you have yourself a participant.
But self-interest is why modern capitalism survives despite, on the face of it, seeming like a terrible system. It would be very hard to convince people who had never heard of it to adopt it by description alone. But if you take away their source of food and clothing, and then offer them a wage by which they can purchase them instead, then you have yourself a participant.
People `HODL` about equities on the nasdaq just as well as they do in crypto. Crypto has more volatility though, to be sure. Leverage can be gained from all sorts of shinanegans, so an underlying asset's volatility is a little irrelevant, you just have to pull a lever to change it.
These days, I consider crypto to be equivalent to buying precious metals, going long volatility, etc. Just different leverage, and nobody knows if you're leading or trailing with correlation to other equities.
It's not free money, but I don't believe in the "it's just a matter of time til' you revert to the S&P ytd growth" meme either.
Full disclosure, I'm 0% in crypto except the 20~ BTC I lost in highschool when I dbanned to install slackware. These days I get my leaverage from volatility, metals and bonds. Scaling, and short/longing as my appraisal evolves.
These days, I consider crypto to be equivalent to buying precious metals, going long volatility, etc. Just different leverage, and nobody knows if you're leading or trailing with correlation to other equities.
It's not free money, but I don't believe in the "it's just a matter of time til' you revert to the S&P ytd growth" meme either.
Full disclosure, I'm 0% in crypto except the 20~ BTC I lost in highschool when I dbanned to install slackware. These days I get my leaverage from volatility, metals and bonds. Scaling, and short/longing as my appraisal evolves.
Personally, the only stake I have in crypto is just mining on my gaming rig (that I bought to play games on) when I’m not using it - while it basically prints free money there’s little sense in me not doing so, and when it becomes unprofitable I just stop doing it.
Miners buying GPU’s in the dozens are going to get burned eventually, don’t make yourself a statistic IMO.
Miners buying GPU’s in the dozens are going to get burned eventually, don’t make yourself a statistic IMO.
I don't disagree, it's just notable because it looks like it's still a very good strategy for a faltering small company. Not really ethical, but effective...
Even in the agency's currently weakened state, I'd think you need to risk adjust the strategy to account for SEC investigation.
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What do you mean "not stated"? Every paragraph starts with the sentence "[Stock] down [percentage] from the peak", all in bold; and there are 12 matches for "from the peak" on that page.
It's pretty incredible how much further some of these junk stocks have to go (down) yet.
RIOT, the failed biotech company, is still at $17.91, up from ~$4 before the naming fraud began.
Their big news consists of winning a whopping 500 bitcoins in a US Marshals Service auction.
Overstock (missing from the article) is still up at $74. The stock traded at something more commonly around $15 to $20 for years prior to the manic pumping. Pull back and look at their five year chart, that spike is how much they have to give back yet. It's all fake value they'll be entirely unable to support with business fundamentals. As the quarters roll by and their actual business sees zero benefit, it'll wilt accordingly.
These junk stocks have managed to be even more pathetic than the worst of the dotcoms in 1999/2000. Not an easy task.
RIOT, the failed biotech company, is still at $17.91, up from ~$4 before the naming fraud began.
Their big news consists of winning a whopping 500 bitcoins in a US Marshals Service auction.
Overstock (missing from the article) is still up at $74. The stock traded at something more commonly around $15 to $20 for years prior to the manic pumping. Pull back and look at their five year chart, that spike is how much they have to give back yet. It's all fake value they'll be entirely unable to support with business fundamentals. As the quarters roll by and their actual business sees zero benefit, it'll wilt accordingly.
These junk stocks have managed to be even more pathetic than the worst of the dotcoms in 1999/2000. Not an easy task.
> It's all fake value they'll be entirely unable to support with business fundamentals
Why is that? Their financials look very solid: https://finance.google.com/finance?q=NASDAQ%3AOSTK&fstype=ii...
Why is that? Their financials look very solid: https://finance.google.com/finance?q=NASDAQ%3AOSTK&fstype=ii...
know any other stocks that have been inflated due to the blockchain mania?
Yet for almost all of them, it is not very profitable to buy put options because of how thin the volume is, and how high a premium you have to pay.
Is there some way to put together some kind of blockchain index? Like, a derivative with all of these blockchain companies underlying? And then short the piss out of that?
You can only short when someone else is willing to lend you their share. I checked a few of the blockchain renamed stocks, and couldn't find shares to short.
.... does that mean I can buy a video card again soon?
Can we just be honest and note that crypto is basically the penny stocks of the 21st century? Their real world price is completely disconnected from the utility gained from them.
You mentioned it: The price is completely disconnected form the utility gained from them. With penny stocks you actually had a share in the company. And with that comes rights. The tokens deployed grant none of these rights. So no, they are not the penny stocks of our time, they are worse.
When the clerk at 7-11 is telling me to buy bitcoin it seems all too familiar...
I told him to cash out asap, hopefully he does. I know he won't.
I told him to cash out asap, hopefully he does. I know he won't.
at least bitcoin has some utility (you can buy drugs with it) over the shitcoins
i knew it would collapse soon since every comment i post (RIP Bitcoin) ... would give me negative ratings last few months.
-4 points by readhn 38 days ago | parent [-] | on: Bitcoin Climbs as Futures Debut Fails to Incite At...
What goes up must come down. What goes up fast and hard usually falls faster and harder. Market 101.
by readhn 83 days ago | parent [-] | on: Ask HN: Why is Bitcoin rising but ethereum remaini...
Getting my pop corn ready for first at least a 50% hair cut on BTC value.
-4 points by readhn 119 days ago | parent [-] | on: Bitcoin blow as fund drops U.S. exchange applicati...
RIP bitcoin. Current valuation is $4142.99 higher than it should be.. Im thinking we will get there within a couple of years. $1-2 seems about right per 1 BTC.
-4 points by readhn 38 days ago | parent [-] | on: Bitcoin Climbs as Futures Debut Fails to Incite At...
What goes up must come down. What goes up fast and hard usually falls faster and harder. Market 101.
by readhn 83 days ago | parent [-] | on: Ask HN: Why is Bitcoin rising but ethereum remaini...
Getting my pop corn ready for first at least a 50% hair cut on BTC value.
-4 points by readhn 119 days ago | parent [-] | on: Bitcoin blow as fund drops U.S. exchange applicati...
RIP bitcoin. Current valuation is $4142.99 higher than it should be.. Im thinking we will get there within a couple of years. $1-2 seems about right per 1 BTC.
> UBI Blockchain didn’t do an IPO. Instead, in October 2016, it acquired a publicly traded shell company registered in Las Vegas, called “JA Energy.” It then changed the name and ticker symbol to what they’re now.
> Over the six trading days starting on December 11, 2017, its shares soared over 1,100%, from $7.20 to $87 on December 18, as the word “blockchain” in its name and sufficient hype and speculator-idiocy took hold. By December 21, shares had plunged 67% to $29. They closed on Wednesday at $38.50. At this price, it still has a ludicrous market cap of $3.64 billion.
https://wolfstreet.com/2017/12/28/im-in-awe-of-how-far-the-s...
SEC froze their stock temporarily and it's down to $9 now.
https://www.google.ca/search?q=OTCMKTS:UBIA&tbm=fin&gws_rd=s...
^ Viewing their stock price graph by "1 year" is quite interesting.
Oh and the CEO + 5 other individuals were trying to sell a ton of stock without investing anything back into the company, not sure if they managed to or not...