In last week’s ETF Think Tank research note, we coated the idea of a Bitcoin ETF. We famous that issuers have been engaged on the product for over 5 years, and nonetheless no US listed Bitcoin ETF has been launched. That mentioned, over the 5 lengthy years, a lot has been achieved to enhance the infrastructure and transparency of the crypto forex market and blockchain know-how. This week we dive deeper into the crypto world and focus on the survival of Altcoins.
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Sock Puppet Marketing
In the late 1990’s, many wonderful web purposes have been coming to gentle and making an attempt to succeed. Perhaps essentially the most notable rise and fall was Pets.com. From Wikipedia:
“Pets.com was a dot-com enterprise headquartered in San Francisco that sold pet supplies to retail customers. It began operations in November 1998 and liquidated in November 2000. A high-profile marketing campaign gave it a widely recognized public presence, including an appearance in the 1999 Macy’s Thanksgiving Day Parade and an advertisement in the 2000 Super Bowl. Its popular sock puppet advertising mascot was interviewed by People magazine and appeared on Good Morning America.
Although sales rose dramatically due to the attention, the company lost money on most of its sales through mismanagement. Its high public profile during its brief existence made it one of the more notable victims of the dot-com bubble in the 2000s.”
The Wikipedia excerpt above blames the failure on mismanagement, however we’d argue that the final word demise of Pets.com was brought on by dangerous timing. The first iteration of web purposes confronted main real-world challenges. Despite the thrill of the expertise, the infrastructure and logistics to help this enterprise mannequin have been costly or non-existent. Today, an organization like Chewy.com is booming with an analogous enterprise mannequin, however in a world with extra web customers, higher web pace, seamless fee programs, on-line advertising and marketing corporations and low-cost delivery and logistics.
Are Altcoins Bad Ideas?
There are over 2000 Altcoins, and most won’t survive of their present kind. However, lots of their worth propositions might be resurrected as soon as the dominant blockchain infrastructure achieves essential mass. Utility tokens like STEEM and BAT make quite a lot of sense, and switch the possession of content material and knowledge to the contributors in a decentralized protocol. Defi, Security tokens and NFTs characterize different nice methods to switch safe transactions with out verified third events, however all of those ideas are like constructing retailer fronts on the moon. Before we will transact on the moon, we want an inexpensive, environment friendly community to get there. We consider a community like Bitcoin has the potential to get there, however till then most altcoins will look extra like Pets.com than Chewy.com.
Perhaps Elon Musk might help…
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