Bitcoin and Friends in 2018? Let’s ask some crypto geeks

By: Mark_Blair

We are the real deal, readers, sleep-on-a-mattress-in-front-of-the-keyboard crypto-currency geeks.

‘How will cryptos behave overall in 2018?’
If you haven’t figured out yet that cryptos are a basically political phenomenon, you are behind the curve. Fiat currencies are an insight into the soundness of national economies. National economies are failing in slow motion. Their representative fiats thereby look less and less appealing. People want to get out of those. So cryptos are going to boom.

‘Might ‘the Government’ just shut them down?’
They may try, and an open-ended global techno-guerilla conflict will ensue.
Moreover, the statements of the MSM finance commentators show that they have no knowledge of how the terrain will change as decentralised exchanges and ‘lightning networks’ and ‘atomic swaps’ come into play. The ability of governments to stop dissolute citizens from buying and trading cryptographic currencies is waning by the day. ‘Dissolute’ is the key term here.

Got any thoughts on the ICOs?
There have been waves of ICOs (and similar) going back to 2013, as there have been waves of other get-rich-quick cryptos: meme coins, ‘country coins,’ high-interesting-bearing coins, pyramid schemes dressed up as cryptos. The awful mistake that we see newcomers making is that they are piling into ICOs BECAUSE they’re ICOs, because they’ve been wheeled out as The Next Big Thing. If asked, I’d be recommending established POW cryptos. Groestl comes to mind. These will likely not provide bazillions of profit, but will also likely not implode next week some time.

Are we in a bubble?
Yes and no.
‘No’ is simple: it’s the answer to the first question: cryptos have become a safe haven from the slow-burn of the GFC.
‘Yes’? Sure. Any craziness could happen at any time. Welcome to Planet Krypto! But we’re asking the wrong question. The correct question to ask is: ‘How long would cryptos take to recover from a crash?’ The answer is: not very long – we’re back once again to the fact of the forces driving the adoption of the technology. The utter incompetence and corruption of the global banking system/government has been becoming more and more obvious in the last two or three years, while more and more people have gained some inkling of what cryptos are.
The genie is out of the bottle.
Whatever, if cryptos crash in price, buy all you can reasonably afford.

What are ‘3.0s’?
Glad you asked! 2.0s, you know, are instruments like Ether, which allow for the creation of smart contracts that ‘piggy back’ on the Ether blockchain, which is home to Ether, the native currency, itself. (This is a horrible over-simplification.) And it was the case some time ago that many folks thought that nothing would ever supersede the 2.0s – which I argued at the time was a poor theoretical perspective.

[And today we’ll gloss over the reality whereby those who were two years ago talking about Ether going to parity with Bitcoin are now strangely silent about how the ICO scams have brought trouble down on the heads of cryptos overall, and how the creation of smart contracts has revealed that those smart contracts are themselves ‘attack vectors.’]

And surprise surprise, we now have several cryptos that are arguably 3.0s. QRL is one – quantum-computing resistant. IoTa is arguably another -- a post-blockchain crypto. Nimiq, I think, also deserves a mention because of the ease of adoption it promises.

Shall we mention the ‘e-fiats’ here?
Yes. These are the ugly imposter ‘national cryptos’ that governments are going to foist upon the unwary very soon. They share much of their technology with cryptos; but as with conventional fiat currencies, they will be subject to Quantitative Easing. They may draw significant amounts of capital away from true cryptos for a while; but when folks begin to understand their nature, they’ll shift to real cryptos.

How do you structure a portfolio?

Well, you may trade ICOs and other crypto instruments as you see fit; but over time – and I assume here that your interest is not to cash out to fiat, but to hold cryptos – you recognize that crypto profits and ‘crypto value’ are different things, and you find yourself socking that ‘crypto value’ away in a small range of instruments that really look like they’re going to survive – but this brings us to another term: ‘rolling portfolio.’ Having accepted what I just wrote – that you should be ‘working your way back’ to a select number of proven instruments -- it is simultaneously the case that you must be sharply alert to the signs that a crypto is going bad, and begin sneaking away from it, and into whatever crypto you have decided represents the ‘leading edge’ of your rolling portfolio.

Tell us about the ‘corpus callosum thing’
The corpus callosum, guys, is the fat cable that connects the two halves of the human brain, and I find myself talking about it when I’m trying to describe the utterly breathtaking degree of development that us IndiaMikeZulu guys have witnessed since we started. At first, cryptographic currencies were just cryptographic currencies – albeit with some pretty cool features. Then came the 2.0s, which introduced the reality of smart-contract-goods-and-services that could be paid for with cryptographic currencies built in. (A good example is an app that allows you to simultaneously book and pay for a long-term car-parking bay.)
BUT THEN the number of applications just began multiplying exponentially: data storage, voting, tax collection, stock-exchange-trade settlement, fiat-banking-transaction facilitation (!), environmentally-focussed instruments, defense applications, instruments with in-built governance mechanisms, privacy-centric coins, meme coins, combinations of all of the above, the e-fiats aforementioned, and I’m sure lots more that I haven’t even heard of yet.
Whatever, it’s now apparent that the ‘corpus callosum’ of blockchain/cryptos will eventually be what connects the old, pre-blockchain global economy and the new, blockchain-centric economy (unless the powers that be crash the global-economy clown car into a ditch in the near future. Fifty-fifty either way, I reckon! And then those old-school POW cryptos I mentioned above will easily be the most valuable. Go, XJO!).

Any final general advice for readers?
Yes!! Operational security is the business of making sure that when you get up to trade tomorrow, your cryptos are where you left them the night before. Any bona fide long-timer has tales to tell about this: exchange hacks, exchange collapses, exit scams, phishing sites, address-substitution programmes, Trojans, email hacks, hardware-device failures, poor backing-up of pivotal data, and plain old dumb mistakes. If you want to succeed in cryptos, make ‘OPSEC’ your primary goal.

Mark Blair had over thirty years experience in libertarian politics and theories before he got caught up on cryptos. You can find him on the Groestl Telegram channel.

Copyright © 2017 Mark Blair - All Rights Reserved

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