{"id":238859,"date":"2022-06-10T10:30:12","date_gmt":"2022-06-10T09:30:12","guid":{"rendered":"https:\/\/cryptoslate.com\/?p=238859"},"modified":"2022-06-10T08:31:25","modified_gmt":"2022-06-10T07:31:25","slug":"op-ed-overhyping-crypto-tarnishes-more-than-the-industrys-reputation","status":"publish","type":"post","link":"https:\/\/cryptoslate.com\/op-ed-overhyping-crypto-tarnishes-more-than-the-industrys-reputation\/","title":{"rendered":"Op-Ed: Overhyping crypto tarnishes more than the industry\u2019s reputation"},"content":{"rendered":"<p><span style=\"font-weight: 400;\">\u201cBlockchain is a technology looking for a problem.\u201d It\u2019s a criticism every crypto enthusiast has heard from friends who haven\u2019t yet taken the red pill, and while scathing, it sometimes almost seems true.\u00a0<\/span><\/p>\n<p><span style=\"font-weight: 400;\">Blockchain will transform economies in almost every regard. But too many blockchain companies operate as though they don\u2019t actually believe that. Instead of building a product with an actual product-market fit, such companies prioritize capitalizing on the latest round of hype and pumping their token. This short-term thinking damages more than just the industry\u2019s reputation.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">The push to announce a launch to the community at an earlier date or overpromise on a particular update creates problems that actually run as deep as the product\u2019s code itself.\u00a0<\/span><\/p>\n<p><span style=\"font-weight: 400;\">Inexperienced developers often don\u2019t understand the extra steps needed in testing blockchain apps\u2014especially when they are working to meet an unrealistically tight deadline arbitrated by hype. The <\/span><a href=\"https:\/\/www.forbes.com\/sites\/jackkelly\/2021\/06\/26\/cryptocurrency-companies-waging-a--a-war-for-talent-in-a-hot-job-market\/?sh=6b91a42a6b19\"><span style=\"font-weight: 400;\">global shortage<\/span><\/a><span style=\"font-weight: 400;\"> of software developers and engineers exacerbates this challenge, resulting in bugs delaying the launches of products\u2014and in some instances major hacks. <\/span><\/p>\n<p><span style=\"font-weight: 400;\">This is precisely what happened in the case of <\/span><a href=\"https:\/\/www.wired.com\/story\/hackers-drain-31-million-from-crypto-service\/\"><span style=\"font-weight: 400;\">MonoX Finance<\/span><\/a><span style=\"font-weight: 400;\">, a decentralized protocol allowing users to trade digital assets with fewer requirements than a regular exchange platform. An accounting error was unintentionally built into MonoX\u2019s smart contract, which hackers easily exploited.\u00a0<\/span><\/p>\n<p><span style=\"font-weight: 400;\">By using the same tokenIn as the tokenOut (methods of exchanging the value of one token for another), the hackers were able to greatly inflate the price of the native MONO token when the updating tokenOut overwrote the price update in the tokenIn. The result was a loss of $31 million in tokens from both the Ethereum and Polygon blockchains. Of course, there is no logical reason for the software to permit transactions exchanging the same tokens.<\/span><\/p>\n<h2><b>Consumed by the hype<\/b><\/h2>\n<p><span style=\"font-weight: 400;\">The crypto industry\u2019s development hysteria stems from the lack of regulation and the overreliance on retail investors to raise funds in advance with the promise that \u201cmass adoption\u201d will make them rich. Every new dApp and P2E game claims to be the thing that will spark mass adoption &#8211; as long as you buy the ointment or the token. It\u2019s a modern-day \u201ccure all\u201d and these guys are just the latest in a long line of snake oil salesmen.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">Many industry marketing teams use a sales technique called \u201cthe presumptive close.\u201d It\u2019s an argument bitcoin maximalists make for astronomical forecasts of bitcoin, assuming the first digital currency one day surpasses gold\u2019s market cap or becomes the world\u2019s reserve currency (which, yes, it very well might). <\/span><\/p>\n<p><span style=\"font-weight: 400;\">Countless crypto startups make the same kinds of statements to win over inexperienced retail investors looking to replicate the success of early bitcoin investors, saying things like \u201cfour billion people use online payments, and if we catch just 10 percent of the market, we will become huge.\u201d\u00a0<\/span><\/p>\n<p><span style=\"font-weight: 400;\">These types of projects often attract and resonate with retail investors keen on finding a high-risk, high-reward investment. The built-up hype rushes developers through the development phases in order to meet deadlines and appease investors by showing progress. This rush to launch an app or token prematurely compounds the bug problem. This deadly combination creates a cycle where projects need to keep feeding the hype to survive.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">When these projects inevitably fail to meet their overly ambitious expectations, retail investors end up losing because the project wasn\u2019t grounded in reality. Venture capitalists can invest in 50 projects with the expectation that 45 will fail, but they will ultimately still turn a profit thanks to the successful five. Retail investors don\u2019t have this luxury. Therefore, it is paramount that retail investors, who don\u2019t have the background to fully vet all crypto projects, receive realistic and honest assessments and descriptions of a project's business model and tokenomics. More transparency is always better\u2014this will attract more retail investment than promising \u201chuge returns.\u201d<\/span><\/p>\n<p><span style=\"font-weight: 400;\">It\u2019s usually not genuine ill will but inexperience, lack of business leadership, and pressure to deliver quick gains leaving retail investors feeling like chumps.\u00a0<\/span><\/p>\n<p><span style=\"font-weight: 400;\">The problem with blockchain is not with the technology itself, but rather with the opportunism of certain companies in the industry. Only through due diligence and a more realistic approach during the development process can the industry accelerate its maturation process and show the true nature of blockchain and the benefits of a decentralized internet.\u00a0<\/span><\/p>\n<p><span style=\"font-weight: 400;\">When that happens, we can talk about blockchain being \u201ca solution looking for a problem.\u201d<\/span><\/p>\n","protected":false},"excerpt":{"rendered":"<p>\u201cBlockchain is a technology looking for a problem.\u201d It\u2019s a criticism every crypto enthusiast has heard from friends who haven\u2019t yet taken the red pill, and while scathing, it sometimes almost seems true.\u00a0 Blockchain will transform economies in almost every regard. But too many blockchain companies operate as though they don\u2019t actually believe that. Instead [&hellip;]<\/p>\n","protected":false},"author":1344,"featured_media":242400,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[35,107,25891,36,37],"tags":[],"prediction_market_topic":[],"post_folder":[],"acf":[],"yoast_head":"<!-- This site is optimized with the Yoast SEO Premium plugin v21.9 (Yoast SEO v21.9.1) - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>Op-Ed: Overhyping crypto tarnishes more than the industry\u2019s reputation<\/title>\n<meta name=\"description\" content=\"Crypto companies opportunistic behavior&#039;s only helps to serve it&#039;s own developers without providing actual value.\" \/>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/cryptoslate.com\/op-ed-overhyping-crypto-tarnishes-more-than-the-industrys-reputation\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Op-Ed: Overhyping crypto tarnishes more than the industry\u2019s reputation\" \/>\n<meta property=\"og:description\" content=\"Crypto companies opportunistic behavior&#039;s only helps to serve it&#039;s own developers without providing actual value.\" \/>\n<meta property=\"og:url\" content=\"https:\/\/cryptoslate.com\/op-ed-overhyping-crypto-tarnishes-more-than-the-industrys-reputation\/\" \/>\n<meta property=\"og:site_name\" content=\"CryptoSlate\" \/>\n<meta property=\"article:published_time\" content=\"2022-06-10T09:30:12+00:00\" \/>\n<meta property=\"article:modified_time\" content=\"2022-06-10T07:31:25+00:00\" \/>\n<meta property=\"og:image\" content=\"https:\/\/cryptoslate.com\/wp-content\/uploads\/2022\/06\/crypto-hype.jpg\" \/>\n\t<meta property=\"og:image:width\" content=\"1200\" \/>\n\t<meta property=\"og:image:height\" content=\"630\" \/>\n\t<meta property=\"og:image:type\" content=\"image\/jpeg\" \/>\n<meta name=\"author\" content=\"Kaaran Kalantari\" \/>\n<meta name=\"twitter:card\" content=\"summary_large_image\" \/>\n<meta name=\"twitter:creator\" content=\"@cryptoslate\" \/>\n<meta name=\"twitter:site\" content=\"@cryptoslate\" \/>\n<meta name=\"twitter:label1\" content=\"Written by\" \/>\n\t<meta name=\"twitter:data1\" content=\"Kaaran Kalantari\" \/>\n\t<meta name=\"twitter:label2\" content=\"Est. reading time\" \/>\n\t<meta name=\"twitter:data2\" content=\"4 minutes\" \/>\n<script type=\"application\/ld+json\" class=\"yoast-schema-graph\">{\"@context\":\"https:\/\/schema.org\",\"@graph\":[{\"@type\":\"NewsArticle\",\"@id\":\"https:\/\/cryptoslate.com\/op-ed-overhyping-crypto-tarnishes-more-than-the-industrys-reputation\/#article\",\"isPartOf\":{\"@id\":\"https:\/\/cryptoslate.com\/op-ed-overhyping-crypto-tarnishes-more-than-the-industrys-reputation\/\"},\"author\":{\"@type\":\"Person\",\"@id\":\"https:\/\/cryptoslate.com\/author\/kaaran-kalantari\/#person\",\"name\":\"Kaaran Kalantari\",\"url\":\"https:\/\/cryptoslate.com\/author\/kaaran-kalantari\/\",\"mainEntityOfPage\":{\"@id\":\"https:\/\/cryptoslate.com\/author\/kaaran-kalantari\/\"},\"image\":{\"@type\":\"ImageObject\",\"@id\":\"https:\/\/cryptoslate.com\/author\/kaaran-kalantari\/#authorimage\",\"url\":\"https:\/\/cryptoslate.com\/wp-content\/uploads\/2022\/06\/Kaarem.jpg\",\"contentUrl\":\"https:\/\/cryptoslate.com\/wp-content\/uploads\/2022\/06\/Kaarem.jpg\",\"caption\":\"Kaaran Kalantari\"},\"description\":\"Kaaran Kalantari is an ex-crypto hedge fund manager with a strong understanding and knowledge of the crypto market and trading experience. 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Kalantari","image":{"@type":"ImageObject","inLanguage":"en-US","@id":"https:\/\/cryptoslate.com\/#\/schema\/person\/image\/","url":"https:\/\/cryptoslate.com\/wp-content\/uploads\/2022\/06\/Kaarem-150x150.jpg","contentUrl":"https:\/\/cryptoslate.com\/wp-content\/uploads\/2022\/06\/Kaarem-150x150.jpg","caption":"Kaaran Kalantari"},"description":"Kaaran Kalantari is an ex-crypto hedge fund manager with a strong understanding and knowledge of the crypto market and trading experience. Kalantari was an early investor in Web3.0 protocols, with nine years of knowledge and experience in the space. He has active experience in major sectors of the industry and is currently immersed in Metaverse, GameFi, NFTs, and DeFi 1.0 and 2.0. Additionally, he brings decades of experience in marketing, and more specifically, digital marketing to helping brands develop and meet their goals.","url":"https:\/\/cryptoslate.com\/author\/kaaran-kalantari\/"}]}},"_links":{"self":[{"href":"https:\/\/cryptoslate.com\/wp-json\/wp\/v2\/posts\/238859"}],"collection":[{"href":"https:\/\/cryptoslate.com\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/cryptoslate.com\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/cryptoslate.com\/wp-json\/wp\/v2\/users\/1344"}],"replies":[{"embeddable":true,"href":"https:\/\/cryptoslate.com\/wp-json\/wp\/v2\/comments?post=238859"}],"version-history":[{"count":5,"href":"https:\/\/cryptoslate.com\/wp-json\/wp\/v2\/posts\/238859\/revisions"}],"predecessor-version":[{"id":242408,"href":"https:\/\/cryptoslate.com\/wp-json\/wp\/v2\/posts\/238859\/revisions\/242408"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/cryptoslate.com\/wp-json\/wp\/v2\/media\/242400"}],"wp:attachment":[{"href":"https:\/\/cryptoslate.com\/wp-json\/wp\/v2\/media?parent=238859"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/cryptoslate.com\/wp-json\/wp\/v2\/categories?post=238859"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/cryptoslate.com\/wp-json\/wp\/v2\/tags?post=238859"},{"taxonomy":"prediction_market_topic","embeddable":true,"href":"https:\/\/cryptoslate.com\/wp-json\/wp\/v2\/prediction_market_topic?post=238859"},{"taxonomy":"post_folder","embeddable":true,"href":"https:\/\/cryptoslate.com\/wp-json\/wp\/v2\/post_folder?post=238859"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}