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Alternate cryptocurrencies / Altcoin Discussion / General Advice On Trading Crypto
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on: March 05, 2018, 10:40:57 AM
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Seeing all these posts of people suffering huge losses due to an attempt to trade on the blockchain assets market, I felt its time to shed some light on why that is.
Most people enter into the world of trading whit almost no background in finance, the main issue here is the lack of understanding in regards to risk management, basic and fundamental value analysis and the concepts of market cycles and trends.
All these aspects are absolutely essential when attempting to setup a long term viable trading strategy and not to fall into the 80% of traders who end up losing money. Yes you read that right, only 20% of traders are actually making money. That is comparably a very small number when looking into other industries. Its somewhat comparable to the startup economy, where less then 10% succeed.
There are three main areas which you need to focus on:
Emotional discipline
Don't fall into the trap of greed, stick to your plan and don't diverge from it, you'll make a mistake, and again and before you know it you are in deep red losses.
Risk management
How often are you able to make mistakes without falling too deep and not being able to recover? A 50% loss takes a 100% gain to recover from. Your absolute priority shouldn't be to make as much money as possible but to not lose it. Until you figure out a sustainable path of creating an Alpha (profits). A good rule of thumb is don't risk more than 1 % of your capital into a single trade. This allows you to bet wrong 10 times in a row and still being able to recover. This is especially important during your learning curve.
The trend is your friend
Stick to following the trend, don't bet against it also don't fall too short realising that the trend of the market has changed direction. This is where you'll probably will be making most of your losses. Even the very best traders often fail here, they trade the trend for months and get complacent, then once the wind starts changing direction they keep stacking up losses as they continue to trade what they used to even tho markets are changing. Be aware once this happens and lower your position size to transition into a new mind set. DON'T BECOME COMPLACENT!
Hope this is some helpful advice to all the newbies here!
All the best and safe trading!
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Bitcoin / Bitcoin Discussion / The next Bitcoin adoption wave, where do you see it?
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on: February 26, 2018, 10:48:00 AM
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So I have been thinking about this for some time now, we saw a huge wave of new adopters last year, mainly private people buying through say Coinbase, Bitfinex and Bitstamp. We also saw an increase in demand from South Korea and Japan.
So the question is, what is the next phase in the adoption curve?
Some speculate that we'll see ETFs being approved and thus allow pension funds and major institutional money to flow into Bitcoin, others say we'll see governments buying into Bitcoin triggering a financial arms race.
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Alternate cryptocurrencies / Altcoin Discussion / 7 hours until Bitcoin new diff. Bet what is going to happen to Bitcoin Cash?
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on: November 24, 2017, 11:37:43 AM
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There are speculations about what is going to happen once Bitcoin retargets its difficulty, in 7 hours. This is relevant because its the beginning of the fist full mining cycle of 2016 blocks since Bitcoin Cash forked to its new difficulty adjustment algorithm. And there is a scenario in which Bitcoin price dumps, thus mining moving to Bitcoin Cash (assuming stable or rising price) and thus slowing down the Bitcoin block time. Now this leads to even greater block space scarcity resulting in even higher fees. Those high fees are a pretty clear incentive for people to move to a more efficient network, selling BTC for BCH and you pretty much end up with a positive feedback loop. You can follow the progress here: https://fork.lol/pow/retargetI think we can all agree on that price volatility is to be expected either way. |
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Alternate cryptocurrencies / Altcoin Discussion / Blockchain and The Importance of Scalability
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on: September 09, 2017, 04:12:14 PM
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As blockchain assets have breached the milestone of $150 billion in total market capitalisation, some blockchain platforms have begun to reach their capacity limits. We can observe fee markets for blockchain space emerge on the most popular platforms. However, it can be argued that $150B is still far from a significant scale in the world economy. With an ever-accelerating adoption, it outlines an urgent need to focus on blockchain scalability. How are the major players of the space trying to solve this issue?
The fee markets that are developing aren't inherently bad; they will be an important driver behind the adoption of the most efficient solutions. As the fees grow, the economic incentives push users to platforms with superior technology.
The Bitcoin community has been pondering a few options to provide temporary relief for current network congestion. Amongst the proposed approaches, segregated witness would use different accounting for various types of data in the blocks. This would lead to a modest short term block capacity increase.
Long term, some other features of the segregated witness upgrade would allow the lightning network to be deployed, which offers a viable scaling path. Another group advocates for a simple blocksize increase, determined in different ways: predetermined growth, self-adjusting blocksize or emergent consensus.
Unfortunately, an agreement has not been reached and the miners are struggling to come to a consensus on which solution to implement. This has lead to more and more users spilling over to alternative blockchain implementations, such as Ethereum.
Ethereum transactions are accounted for differently than through pure size. Users pay for the execution of smart contracts on the platform. Each block has a maximum number of execution units. Empirically, this seems to lead to a current transaction capacity that is roughly twice that of Bitcoin, as demonstrated by the peak volumes and the network backlog of recent high traffic events.
On a longer time scale, the Ethereum team attempts to tackle scalability by transitioning to verification of blocks by proof of stake. This can be applied to enable sharding of the blockchain over several network segments. While there is a lot of theoretical work behind the plan, the approach is still experimental and it remains to be seen how well it will operate in practice.
Finally, some other projects make a compromise by trading off decentralization for an increase in scalability. The network is composed of different classes of nodes, which have different privileges. This multi-tier system decreases resource requirements at the cost of introducing some centralization. While theoretically easier to challenge, the solution works well in practice on a number of platforms.
A major problem for most scaling solutions is the resource requirement for each transaction. As long as this is the case, the resource usage will grow linearly with the number of transactions. Some approaches of reducing the resource footprint of each transaction are promising as short term solutions, but as the platforms keep growing, they are bound to hit their limit at some point.
The Alvalor team believes that blockchain technology will fundamentally change how our society operates. We will need a platform that can not only scale to a global level in the sense that it is available everywhere. We need a system that can be used by every human being on this planet: a blockchain platform for the whole human race, at the scale of humanity itself.
The most promising concept to achieve this vision appears to be state channel technology, as implemented by the Bitcoin Lightning Network and the Ethereum Raiden Network. Instead of consuming resources for every transaction, the transaction will only consume resources when there is malicious intent from one of the parties. The blockchain will work as a final arbiter only when needed, enforcing trust conditionally.
Major challenges still remain. Bitcoin’s unsigned transaction output model makes it infeasible to design a state channel system that allows depositing funds into or withdrawing funds from a channel after it has been opened. It also doesn't offer support for multi-party channels, which hold tremendous potential. Lastly, channels are limited to one transaction at a time, which could easily stall lightning network routing and lead to the dangerous failure mode.
These limitations illustrate a core conflict we can observe in the blockchain sector. A valuable platform will rise in market capitalisation until it reaches a point of stagnating innovation. It is difficult to experiment on projects which are valued at several billion dollars. It becomes hard to change the fundamental building blocks and to leave behind the weight of a legacy blockchain. These market dynamics make it unlikely that any platform will remain at the forefront of progress until a peak of innovation has been reached.
At Alvalor, we believe that blockchain technology will mature on additional layers, beyond the basic technology. The first layer of blockchain technology has been explored extensively, without conclusively solving the scalability issue. Our team tries to fundamentally rethink the approach by moving complexity up to second and third layer solutions that are clever and simple in their design, just as Satoshi’s original blockchain architecture.
Alex.
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Other / Politics & Society / What They aren’t Telling You about Blockchain
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on: June 20, 2017, 07:29:52 AM
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All the talk is about the amazing rise of blockchain technology and its awesome benefits to banks and all the new features and use cases. There is even talk about the efficiencies it will provide to governments (which is quite ironic as you will soon realise). There is something much more profound happening and unfolding in front of our eyes that not many have identified. Even more profound I’d argue then the inception of the Internet. You could say people don’t see the forest because of the trees. Continuo reading: https://medium.com/@btc_alex/what-they-arent-telling-you-about-blockchain-22d3cbc1a80Do you think blockchain is a viable alternative to governments and central banks? |
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Alternate cryptocurrencies / Altcoin Discussion / Uber on the Blockchain
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on: December 28, 2014, 08:11:10 PM
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Have you guys heard about this one?
Quicksilvercoin (QSLV), they want to intercept countries where Uber is banned by simply decentralizing it.
I mean, if they mange to snag just 1% of Ubers marketshare, then thats a 400mil USD cap.
I'd keep an eye on this one.
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