There is a thing about wanting to showoff, the need to prove that you own something, that you’re smart. Everyone falls into this deep-black-hole at a point in their life and the funny part is that we get drawn without our own knowing. Well, that is exactly the craze for cryptocurrency and the number one reason why most crypto projects fail.
Social media has been very good to the crypto movement and it has spread like a wildfire, carrying with itself all the attributes like decentralized structure, complete security, and ease of accessibility that fiat currencies may not offer the new tech-age. It is important we learn about these processes and garner more knowledge especially for intuitive minds.
In this article, we’ll expound on the many reasons why crypto projects don’t come to fruition, why some turn out to be a scam, and possible pointers to discerning which is heading for failure and those who might stand the chance of making a true impact.
THE PURPLE EFFECT
In explaining why most crypto projects fail, let’s go to a short train ride back in history when the color purple was something to die and kill for. The royals wear purple robes to depict their status and the rich to show off their wealth. Imagine soldiers going to war and coming back with the purple pigment as “great spoils of war”.
Most crypto enthusiasts are just like these soldiers and the royals and the wealthy who do not appreciate the color purple for its beauty but to parade at being a person of high worth. So also, the crypto community is filled with enthusiasts who do not truly understand the power that cryptocurrency and blockchain technology is wielding. Most are carried away by the frenzy of the social media hype, the daily announcement of raising millions of dollars in ICO.
This state of mind is however not just in crypto product developers, but also in the investors and traders of crypto products. Most investors are out there throwing money at it because it has been said to be the next big thing and that the earlier they invest the higher the possible yield. The place of carrying out sue diligence has been ruled out easily because what does it take to invest in crypto? Just a few clicks on your mobile device and you’re in. What else do investors want? Quick return…
Crypto has shown that it has the possibility of bringing home return faster than any other investment, unlike real estate where you have to meet lots of people before sealing a property deal and then wait years before milking the investment.
Cryptocurrency and its underlying technology- Blockchain undoubtedly has a great future in the way we humans will perceive value and its digital access will make it spread faster than any invention in history, reaching the rural faster than any guru will ever predict. Cross border transactions will become seamless. Blockchain technology also has been infused into other areas of our lives including gaming, agriculture, and real estate which indicates broad spectrum adoption.
- We should know that while cryptocurrency as a whole is a promising technology, but NOT every crypto project is.
- Make sure that as a crypto project developer, you understand what your project truly is trying to achieve, do not be a groupie. Don’t fall into the herd mentality. As an investor, ensure that you do your due diligence before investing in trading crypto. While it’s easier to make a fortune there, it is way much easier to lose it.
- Ask yourself this question every time you’re about to be involved in any crypto activity either as a developer or as a crypto investor or trader: What exactly is the purpose of this project? Is the project on course?