Odds and Ends
No matter how bad it might be for you…
Feeling down about the recent market drops? Spare a thought for investors in POLY AI. The project, which aimed to raise $50m from its ICO was a blatant pyramid scheme a la disgraced BitConnect which anyone who took even a cursory glance would have avoided. Still, the spectacular fall from $50m to just $784 market cap (that’s not a typo) is remarkable even by crypto standards. A $1m investment at the ico would now be worth under $20, with prices for one AI falling from $20 to $0.00034.
Whilst sympathy is limited, the sheer brazenness of Poly AI is remarkable. A project with a total supply of just 29,000,000 tokens has a single token holder with 680,289,519 tokens, or just 2,345% of the overall supply. The creators also locked all transfers bar their own, meaning those invested have simply had to watch the scammers liquidate their holdings in recent weeks.
Oh, and another ICO also collapsed today, with the Denaro ICO raising $8.7m and running off into the sunset.
Central reserve printing is back
An error in the Ethereum smart contract setup through Coinbase allowed malicious actors to reward themselves with an infinite amount of ETH, via a system that let parties manipulate their account balance and fraudulently add additional ETH to their account. There is no way to know how many people took advantage of this, but it is a reminder of the central importance of the exchanges and the negative impact they can have on the cryptoassets they feature.
The bug has since been fixed.
Is it really that popular?
A US survey announced that 8% of the population has invested in cryptocurrency. This is hard to believe, on two counts. Less than a third of people aged 18-29 own any stocks, and although 54% of all Americans do, I suspect this number is skewed by the number of people investing through their pension. Personal investing is on a long decline.
Furthermore, cryptocurrencies are still fairly unknown. 8% would be an extremely high number when viewed in the context of internet searches and the market valuation. The survey only asked 2,000 people and was online only. It also claimed that just 4.3% of women own any crypto, meaning that the proportion of American males holding crypto would be more like ~15%. And, unsurprisingly, the younger generations were the more likely to buy, with just 2.25% of baby boomers and 8% of Gen X’s currently invested. Given millennials (17-34 year olds) have low purchasing power, it likely means that the amounts ‘invested’ are very small. This is borne out by the findings, which has the average amount invested at $1,200.
Regardless, headlines by crypto outlets that claimed this showed that “Today’s Bitcoin Buyers Are Still Early Adopters” are the reverse of what I would expect. If 8% of the entire population is actually invested then in the context of the apathy and disenfranchisement towards traditional investing this number seems high and might suggest limited upside going forward.