Despite the soaring prices of cryptocurrencies prior to the recent crash, one lingering criticism remained unspoken: the sector was completely dependent on Bitcoin (CCC:BTC-USD). Where the original crypto coin belongs, so does the rest of the digital market. However, Holo (CCC:HOT-USD) represented the hope that this old paradigm might change.
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For one, the underlying token of the holo-blockchain achieved more than 35 times between the beginning of this year and its peak price in early April. By comparison, Bitcoin rose about 2.2 times from the beginning of the year to its peak around mid-April.
In nominal terms, BTC was extremely impressive as it approached the mythical six-figure price point. However, anyone skilled in mathematics would rather invest $ 1,000 in the holo market than Bitcoin. It’s the difference between buying a pretty fancy car and paying a modest down payment for one.
But not only speculative ardor has attracted investors to the HOT crypto token. As my InvestorPlace colleague Mark Hake noted, the fundamental implications of Holo are incredibly compelling. He wrote:
“Holo wants to disrupt the crypto room. It distributes the blockchain on a peer-to-peer basis instead of everyone having the same blockchain or ledger. Holo says this avoids the “fundamental scalability problem” with existing blockchain platforms. By distributing blockchain ledgers to many different people, congestion can be avoided in both blockchain processing and storage. “
Over time, Hake adds, “The development of these types of apps will lead to increased demand for HOT tokens and also for the HOLO price.” If bullish interest in fundamentals remains strong, he believes the technical Data will follow suit, which will lead to “at least 100%” profitability from here.
I don’t necessarily disagree with the possible uptrend. But the question is when?
YOLO not with HOLO
As I write this, Bitcoin is trying to get back to the $ 40,000 level. The charts got painfully close to that point after a sudden onslaught of bullish sentiment. But the fact that it didn’t get there – at the time of writing – is very illuminating.
This is a crypto coin that was rightfully eyeing the $ 100,000 mark. In fact, many other analysts and forecasters were calling for $ 300,000 – some surpassing this open-source target. So BTC’s apparent inability to raise $ 40,000 (a drop in the ocean compared to 300,000) is worrying. It suggests that people are panicking and turning away from crypto coins.
If so, the benchmark should be the Nasdaq Tech bubble burst in 2000. Because from that perspective, it seems that the crypto market still has a lot to do. Whether you are talking about holo or some other digital asset or token, everything is based on Bitcoin.
Now some of the blockchain pedants will argue that I am using the term crypto and token synonymously and therefore erroneously. Let me save you the time wasted composing an angry email: I don’t care.
It’s not the point of what’s going on. Rather, the holo token (or whatever you want to call it) is currently pinging the classic sign of the collapse phase of the extreme boom-bust cycle.
To be honest, I think it’s very dangerous to buy into the holo token at this point. I would avoid the YOLO (you only live once) aspect of speculative cryptos – or any of the majors. People are afraid of losing their money. When that happens, people do some very strange things.
Acting calmly and rationally is neither.
That means you shouldn’t be going on social media to push everyone to hold the line. If you have significant inventory, consider making something out of it so you don’t risk holding the bag.
But couldn’t it get better?
Of course, the red-hot cops will likely go down with the ship. You may claim that holo is a breakthrough achievement, an innovation that makes the blockchain more accessible and efficient. It may all be true. But I tell you – it doesn’t matter in a market crash.
Yes, over time, I believe there is a high chance that the holo token could be 10x from here. But I also believe there is a good chance that HOT could go down in the next few months. If so, you could get 20x profits for the same cash outlay.
The bottom line is that panicked animals are the most dangerous, much like trying to save a drowning person. Unless you’re a trained professional, holo is an endeavor that you should hold out until the coast clears.
At the time of publication, Josh Enomoto held a LONG position in BTC. The opinions expressed in this article are those of the author and are subject to InvestorPlace.com’s posting guidelines.
Josh Enomoto, a former senior business analyst at Sony Electronics, has helped broker key contracts with Fortune Global 500 companies. Over the past several years, he has provided unique, critical insights into the investment markets as well as various other industries including law, construction management, and healthcare.
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