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by root_axis
3210 days ago
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Trading cryptocurrency tokens is not investing, it's speculating in the hopes of making a return on the price increase. Investing is when you spend money to generate useful economic activity in exchange for a fraction of the operation. Trading eth and buying cryptotokens doesn't generate economic activity or give the spender any rights or privileges as it relates to cryptotokens, all it does is perform a direct value transfer from one person to another. The programmability aspect is cool and novel but mostly useless in practice, .e.g smart contracts and similar tech have yielded close to zero in terms of useful applications. Besides internet gambling I cannot think of a single useful application for smart contracts even in theory, in practice they are non-existent. |
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Moreover, the applications developed as a result of token funding can generate economic activity and increase efficiency. And it's not out of the question that traditional companies will issue security-tokens that provide a legal claim (or perhaps a claim that while not contractually guaranteed, is guaranteed by collateral put up by the firm, and which is held by a larger trusted third party that acts as an adjucator) on the company's underlying assets and revenues, especially in countries that are not well connected to the international financial system and thus have difficulty receiving payments from foreign investors. Token securities could also be an opportunity for smaller companies that have difficulty meeting the regulatory requirements for issuing traditional securities and which operate in countries where issuing such tokens is not illegal.
In any case, this particular contention is somewhat beside the central point I was trying to make, which is that the programmatic and geography/identity-transcending nature of cryptocurrency gives it abilities that traditional currencies don't have, and will obviously find use-cases in an enormous number of applications overtime.