$1.00 Steem? Swimming in an Ocean of Red Ink... AGAIN! I Just Give up!
Today was another cryptocurrency market bloodbath, as (last time I checked) Coinmarketcap reported 99 of the top 100 tokens down; most of them by double digits.
Red poppies in the sun
We're all losing our shirts, here! Waaaaah!
Bitcoin recently had a mini rally that gave people a tiny bit of hope that a turnaround was in the making... and has now given back all of its gains. And maybe there's more to come.
Meanwhile, Steem is flirting with the $1.00 level, and my account value is now lower than it has been since the first part of December 2017... and I have added a lot of SP since then!
WTF, over?
Let's just cancel Christmas, pack it all in, and go back to flipping burgers...
But I Thought this Was Going to be the Wave of the Future?!?!
Market cycles are a pretty inevitable part of the investing landscape. Cryptocurrencies are out on the new frontier of "alt investments," so it's natural that we're going to be dealing with volatile markets, here.
Kramer the cat says: "Everything seems upside down!"
I have a sneaking suspicion that today's market activity might signify that we've entered a new phase of the market cycle, known in the greater investment world as "capitulation."
It's what happens when people give up hope that "a market turnaround" is going to ever happen, and the last of the "gamblers and speculators" sell off their holdings at firesale prices, resigned to the reality that they are never going to have their investment "go up 10 TIMES."
So they bail out, and go do something else... like play roulette, or bet on the ponies.
Certain elements are in place to support that idea, including the recent "mini rally" in Bitcoin which gave people a little bit of cautious "false" hope. But with every $100 BTC gained, there was a crowd of people waiting to bail out of their investments, so there was no sustainability there.
So What Now, Kemosabe?
The capitulation stage of an investment market cycle is kind of cool because a lot happens, quite a bit of it psychological.
Maybe we should all just find a place to chill out...
Now I could toss up a bunch of technical charts here and point out that the Jackson-Smith Oscillator curve is doing a backwards Half-Nelson with the Systemic FLIP Indicator... but that would be a load of bullshit.
What we're looking at here is a change of psychology, and that doesn't work well with technical charts.
Instead, I'm going to call on something totally intangible called experience and intuition, as it applies to the underlying sentiment of a crowd.
It might be hard to believe, but "capitulation" is actually a positive signal. Why? Because it's a stage of the cycle where the "gamblers and speculators" tend to leave the market, having been burned once too often in their short term strategies. On the upside, this is where "value investors" start entering the market.
Salmonberry blossoms
Value Investors come in and buy depressed assets with long term appreciation prospects. Solid projects. And they tend to be picky.
As Warren Buffett once observed: "When the tide goes out, you discover who's been swimming naked."
So something like Steem looks pretty good: Super fast blockchain, no or low fee, loads of excess capacity. Very different from "Shitcoin Number 1042" which had an ICO simply because the word "blockchain" appeared 42 times in the White Paper.
The good thing about Value Investors is that they tend to have a "buy-and-hold" approach. They generally don't care what the price of Steem or Bitcoin is doing tomorrow, or next week, or next month. Their time horizon tends to be years.
That can be a positive because it tends to add market stability. Granted, cryptocurrencies is "new territory," but so were "Dot-com stocks," in the years 2001-02.
But it's not a positive if you're a "gambler," only if you're an actual "investor."
Have the Fundamentals Changed?
As the markets try to find the real bottom, and we start scouting for value investors... let's look at whether the fundamentals for Steem (not Steemit) are still valid.
The sun will still set, tomorrow!
Sound technology, super fast blockchain, highly rated by Weiss ratings, lots of excess capacity, functional economy of various apps being added... CHECK.
That already puts us way ahead of the crowd.
And we have a potential "ace in the hole," at least a possible first one... in the form of the @steemmonsters craze.
How so?
SteemMonsters is an external initiative that — if it goes viral on a web level — could bring hundreds of thousands (if not millions) of users in touch with Steem/Steemit. And it is — to my knowledge — one of the very few ways you can get from your fiat debit card directly to Steem without massive fees or going through BTC or an exchange. That's a potential game changer, if people understand how that can work!
Anyway, the fundamentals haven't changed, meaning that Steem would be pretty high up on a Value Investor's shopping list. Just something to think about...
So no, I am NOT giving up, or heading for the hills. But I think that sentiment is thicker now than it has been before.
And that may be a GOOD thing!
How About YOU? What are your thoughts on the current market situation? Are you bailing out? Or settling in for the long haul? DO you believe the fundamentals of the Steem blockchain are still valid, or has something changed? Leave a comment-- share your experiences-- be part of the conversation!
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Created at 180808 23:01 PDT
Great article. Should be upvoted well beyond the current payout. Sad that low quality refuse is sitting above your thoughtful, well-articulated, and insightful piece here.
I am happy if this is true capitulation. Ready for the true believers to take over.
Cheers, @denmarkguy.
Thanks Graham... I guess it's going to earn what it's gonna earn. Which is probably not very much. Because I'm not going to throw $200 at bidbots, so I can pretend I created something hugely worthwhile. But who knows? Never say never... someone with influence might think it's cool and re-steem it.
Whatever. Not attached. I haven't had anything "organically" in Trending since about when HF.19 kicked in.
But appreciate the encouraging words!
Good read. Not having a lot of influence, but I did resteem it :)
Thank you @scandinavianlife, I appreciate the support... as the old saying goes "It all counts."
Great article. We're on one of the few blockchains that is being used by non-technical end-users for its intended purpose. In a world of shitcoins, that's rare. It's far less risk than most early stage coins and represents a massive opportunity. There's still risk, but yeah, good time to dump the shitcoins and rebalance the portfolio for value.
My SP's a bit low, so I tipped you a @steembasic income share. It's a gift that keeps on giving.
Thanks @eturnerx! And I appreciate the SBI share — big fan of the @steembasicincome initiative; good for everyone, but particularly encouraging for newcomers who are struggling to get traction here. That, and @dustsweeper are great things for "everyday" Steemians.
Whether we are truly in the "capitulation" stage, or not, we definitely seem to be in a re-evaluation stage. I think the days where you can just say the word "Blockchain" and people throw $100 bills at you are numbered. Projects need to have more substance than just empty air... and the markets will reorganize and rebound, with a new paradigm of worthless shitcoins becoming worth about... nothing... and solid projects gaining in value.
Steem is an interesting market leader in being not only accessible by non-technical users as you pointed out, but it's also increasingly becoming a "utility coin." There's SteemMonsters; there are more and more economic initiatives working at the retail level ( @steembay, @steemshop ) which means "real people" at street level using the Steem blockchain in some capacity.
Those are things that help create real demand for Steem, not just "speculative" demand. Which creates upwards price pressure. But for that to actually happen, I believe we do need to experience a cycling through the investor class holding Steem... out with the daily gamblers, in with the longer term "holders" who aren't watching daily prices, but ask the question "can I 10x my money in 3 years?" and then otherwise leave it alone.
I have nothing of value to add right now, but I wanted to point out that this was an enjoyable read. And I'm human, not a bot. :)
I appreciate you being a real human, and not a bot. I think we "organics" need to stick together and support each other. So you get a "real human" upvote...
I love the "organics" term. I need to start using that!
Please do! I just invented it because we have so much talk of "bots" around here, and automated voting... so those of us who actually read and type comments as HUMANS? Yeah, we're "Organics."
Let me first start with saying that it is a great post.
I don't have an economical background, so I can't give a technical explanation. I am in doubt. One part of my brain tells me that I can write off the crypto investments as a loss. The other part tells me that we will some great ATH once, maybe not this year or the year after but pretty sure after that!
I was thinking this morning in the car if we can compare the current situation with the dot.com bubble which bursted. If you would have invested in the right companies back then, you are probably not working now anymore.
So, it could go both sides. And probably I will keep on strengthening my position in some coins like Steem, Neblio, Neo, Ehtrereum, Bitcoin, EOS and Stratis.
Time will tell if that was foolish or brilliant!
Cheers,
Peter
Thanks Peter!
As you know, the people who hung onto their shares in things like Yahoo, Amazon, Dell and other large solid "dot com" businesses indeed did very well for themselves.
Although I don't have a crystal ball, it seems to me we may be in a similar phase at the moment... and a lot of the so-called "shitcoins" will go down... and never come back, while solid projects like you listed will bounce back up.
I agree with you about the capitulation. I was reading it elsewhere in a couple of other places, too. @louisthomas I think did a video about analyzing samples of comments on his YouTube videos on crypto. During the ATH there were a lot of pie in the sky people convinced the price would magically never fall again, and any talk of correction was crazy talk! Then during the lows before the recent blip upward, it was full of doom and gloom. It's so very much psychological. I wish I could hodl more and didn't need to sell for rent money, but I'm at least building my Steem Power, which I think is a good investment in my future sustainability!
It is, indeed, a good investment in future sustainability. I very much hope to be able to weather our current downturn in business outside anything to do with cryptos without having to power down any. Had to last year, and that was during the pretty slow times with fairly low Steem... went from over 7000SP to about 2000 before I could afford to stop... it has been tough building it back up.
Ouch, I believe it!
...I just posted a more 'tongue in cheek' perspective of the same topic!
(you nearly made it on the 'interview' list, btw! lol)
https://steemit.com/blog/@lucylin/steemit-crypt-special-oops-steemit-crypto-special-comedyopenmic-25-2nd
hodl! hodl! hodl!
That was a good read... some wet fish slapping on Jerry is definitely a sign of... of... of... wanting to slap Jerry with a wet fish.
Speaking of "making it on the interview list," any idea what happened to Everitt? He suddenly stopped posting... I know he was trying to buy a house, so I'm going to go with the reality that he's been in the throes of moving, rather than something more serious, like a medical event.
I don't know about Everitt matey, - I was thinking the same things...
I hope everything is ok with him.
(Hopefully he is in his new residence, and busy melting any local snowflakes ! lol)
I've actualy been buying the last coupld of days @denmarkguy. Having missed the last two dips I finally took a deep breath and decided not to miss this one.
I had bitcoin sitting there because I'd got that far but I kept waiting for Steem to go down just a bit more. 😂
Keeping blogging is a bit harder when I catch sight of my earnings though. I have a couple of posts worth as low as 0.06c. 😱 That's like when I first joined. So I'm trying not to look!
I had forgotten this so that's a bit of good news at least.
Wishing you a peaceful and prosperous day! 😊
Yeah, it's hard to stay motivated when your posts are barely earning anything. But remember that when the price of Steem is low, even a lower dollar amount on your rewards mean you get more SP. So you'll have more in your account when the prices go back up. Kudo's to you for buying into the weak market... that's generally a wise strategy.
I just hope the diversity of buys and holders is increasing not decreasing. Having just a couple holding the mass of wealth will always become problematic when they want to sell off their holdings.
Myself I’m just holding what little I have everywhere. Can’t afford to risk what I don’t have so I’m not buying either. So many seem to have invested and are now panicking because they can’t afford to have such low prices.
All those daily casher outers are just not thinking in long terms. Granted I can understand some of them can’t afford to but that points to there being other issues going on then just the price of a cryptocurrency.
The thing about low prices in a market like this is that as the prices slide down, more and more risk averse small investors look at this and say "well, I can afford to put $100 at risk on the crypto thing." They probably avoided the rollercoaster ride last year, but now they are more open and looking for an entry point.
Bigger investors are more likely to be gunshy at this point... worried that they might get in and lose even more. They'll more likely get back in when things are already going UP again... and then help everyone else as the catalysts that suddenly drive the price up on really high volume.
That's just speculation, on my behalf, but it "feels" right.
now i am sleeping and again i will awake up soon ..
Maybe I am crazy but I just bought another $50 bucks worth of crypt because the price was so cheap. I'm poor. I can't really afford it but my brain keeps telling me BUY! every time I see a new lower value.
Sure my overall portfolio looks like it got placed in a dehydrater and has shrank to a pee, but I'm holding on, hoping for fertile soil and a nice rain. Soon (a year or two) this will all turn around and then we can jump in the deep water naked.
The thing I remind myself of is that blockchain technology is still highly valid and relevant... that hasn't changed. And here there are lots of great apps being built on the Steem blockchain, which is fast and no fee and nowhere near capacity. Lots of things in its favor. So when things DO turn around, those who hung on during the downturn are going to be really glad that they did so... but the timeframe is longer now; as you say, maybe a couple of years to multiply the investment.