Yesterday I was reminded about one of my abysmal investment failures of the 2018 era. I am, of course, talking about Cobinhood.
This is one of those things that I've been ignoring for years. Back in those days every ICO was gonna go to the moon, amirite? Why not throw down $100 on a bunch of random shitcoins? That's just a guaranteed way to get rich!
Yeah, but it wasn't though.
Every ICO I put money into lost like 99% of its value. OOPS! Took me a while to recover from that blunder but here I am ready to quit my job a few years later.
Cobinhood was a Robinhood clone for crypto. Robinhood founded their business on a model that didn't charge trading fees. Cobinhood figured they could do the same thing and make a killing in the cryptosphere: they were wrong.
The major problem with this business model is that, just like every other "free" service out there, the company providing the service needs to monetize the data they control. This turns Robinhood/Cobinhood users into little data farms just like Facebook/Twitter, and other social media sites.
Who pays for this data? Whales looking to capitalize on the folly of retail investors (also advertisements). It shouldn't be that hard to see why Cobinhood failed.
Crypto is already a much more open system. What kind of data can Cobinhood acquire/sell that isn't available with other exchange APIs? Also, monetizing data requires huge volume and overhead costs. I imagine the cost and time it takes to scale up to a profitable position is no easy feat.
On top of that, crypto trading fees are not a big deal. Like, at all. Binance charges 0.1%. Even the 0.5% that Coinbase Pro charges is fair enough. There's no need to "escape" to an exchange that doesn't charge trading fees: especially when most traders get wrecked anyway and they jack up the withdrawal fees.
Bye bye $100
So yeah I put $100 into Cobinhood in 2018, and now they are emailing me every so often about how they are completely bankrupt and liquidated. I downloaded the files they sent me, and that $100 is worth less than $1 because it was the native COB (Cobinhood) token that obviously won't be worth jack shit anymore. Live and learn.
lol @ 2018
This is how I know that all the fear in the market is totally unfounded. Many seem to have forgotten how batshit insane it was back then. By all accounts 2021 will be even more batshit insane than 2017. Everyone is worried that the bull market is over when it really hasn't even started yet. Word to the wise: we don't have to worry about a bear market starting when everyone is terrified that a bear market is starting. Gains and losses strike when you least expect them, not when the mob says so. The mob gets wrecked: count on it.
And so it was with over a dozen random shitcoins. I haven't held any of them and when I sold I took massive losses on them all. When Steem fell under attack by the mighty Sun I liquidated all my garbage to buy more Steem. Surprisingly that did not blow up in my face.
This community is my home base. Bitcoin is my anchor. Hive is unkillable at this point. All these new shiny things out there are seedlings ready to get stomped on at any moment.
This bull run hasn't even started yet. DeFi yield farms are the new ICOs, and there will be 1000 more of them before this is all over (hell, I'm even making my own). This is interesting because yield farms already have x10 more utility than the promise of an ICO, so money will be flying everywhere. Of course the chickens always come home to shit all over everything. When no one is worried about a bear market because BTC is $200k+, that's when we need to be worried.
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