I have some Ethereum but I see it as an extremely risky investment long term. Sure it could keep going up, but what exactly are we investing in ?
If you think you are investing in the business models (DAO's) that run on it, think again. As far as those are concerned the blockchains are interchangeable. What happens when a successful DAO decides it wants to move to the next latest and greatest platform - be it Tezos, Rootstock, Ether Classic, whatever ? No problem ! They just create new tokens on the competing chain and supply them on a 1 to 1 exchange basis for the 'old' ones.
Thats the problem with these smart contract chains. There's an airgap between the base token and the real value source.
That airgap isn't there with the monetary blockchains. If you own Bitcoin, Litecoin, Dash, Monero, Dogue, Peercoin, Unobtanium, Jackpotcoin you own it because the coin itself has value. There ain't no replacing it with another chain because it ain't itself any more. Whereas with a DAO token, you can move it to another chain and it's STILL itself.
I therefore regard these smart contract tokens with extreme caution when it comes to holding them as store of value. Monetary tokens can keep going up forever. Smart contract tokens can have the value drained out of them one day by a competing technology and for it never to come back. Consider investing in electronic typewriters in the 1970's. You'd have made a lot of money as long as you got out at some point. But if you held till the end of the 80's you'd be broke. Meanwhile if you'd held precious metal throughout you'd be fine.
Therefore the general rule is:
Monetary Blockchain Tokens: Real Gold
Smart contract Blockchain Tokens: Fools Gold
Smart Contract blockchain tokens = the 'Electronic Typewriter Shares' of the 21st century
good and clear explanation!
in the future people can pretty much creating token/coin/contract/dao on Ark platform and move or exchange their Eth token/contract there. Ark is just one of many better platform coming next and soon there will be many with better scalability network, larger(current 200tps) and fast transactions.
i see Ark is cracking this code wide open.
