Tuesday, July 3, 2018

GMGH take on Utility Tokens

Here is the reference article, please read it.

Here is the main classification table, I will reference it.



Store of Value
Only a HANDFUL will exist. Scarcity (stock to flow), decentralization and willingness of other people to accept them as stores of value are key factors to determine success. Upside potential is high, but can you figure out which crypto fall into this category?

Stablecoins
Has no upside, with 100% downside risk. Not for investment purposes, but excellent as a medium of commercial transfer and short term wealth transfer.

Payment Tokens
Shit.

Governance Tokens
Shit, unless you get paid (DGD)

Discount Tokens
Shit, unless people actually want to buy the tokens and use it for the discount themselves (BNB)

Work Tokens
This is my preferred classification. I believe that REP, HAV and actually even DGD falls into this category. The whole article above talks about why they are unique and special.

Burn & Mint Tokens
I have no opinion on them because I am not familiar with any good models of this.

Security Tokens
Pretty much the same as investing into any normal security, except you have global 24/7 trading, but the downside risks of the underlying asset itself does not change.


Conclusion

I only hold SoV crypto, Work Tokens.
I use discount tokens.
I am betting on the USAGE of stablecoins (NOT it's value appreciation, since there is none)

You most likely hold Payment Crypto / Tokens, which... surprise, surprise, nobody is actually accepting as payment.

I urge you to re-evaluate the kind of crypto that you hold and to think if they even have any value. Can I use the token? Can anyone else use the token? Who would buy the token from me and for what reason?

The failing of most crypto investors is being unable to realize that the success of the company and its products may, and usually, have NO correlation or impact to its token.

All the best.

2 comments:

  1. Hi GMGH, been following your blog for a while.
    Just a quick question. Was wondering if you could give some ideas on how/when is a good time to withdraw profit and the psychology.

    For example: I bought a coin at 0.1 ETH, I told myself to withdraw when the value reaches 0.2 ETH. But when the coin reaches 0.2ETH, another thought will come to my mind saying, it will go higher thus holding it longer. More often then not, the coin will drops down to 0.15 ETH, I will be thinking the same thing, 'ok i will withdraw when it is 0.2ETH' and the cycle goes.

    Thank you in advance.

    ReplyDelete
  2. is there a list, where the top 50 or something are categorated after this model?
    sometimes its hard to identify what kind a token really is

    ReplyDelete

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