SBE Students on Crypto

We’re living in a time right now where Blockchain is becoming the next big thing since the introduction of the internet. The technology behind Bitcoin is going to put a lot of institutions and banks offside. More and more people are starting to invest in Bitcoin and especially all the alternative cryptocurrencies. They believe it is the future and one of the best opportunities to make money at the moment. As you probably have seen, in December Bitcoin’s price grew exceptionally and it got a lot of attention in the news. However, also a huge dip occurred last January which indicates how volatile the cryptocurrencies are at the moment.

To help you get a better understanding of Blockchain, Bitcoin, and other Cryptocurrencies, we talked with 2 SBE students who know a lot about the subject and successfully invest in the currencies themselves

 

Joeri • first-year Business Administration student

When and why did you start investing in cryptocurrency?

I started investing in cryptocurrency around August 2017, but I’ve been following since April. I think I just got triggered by the tech, it seemed very interesting to me; a decentralized monetary system. I started reading about it on platforms such as Reddit, Medium & Bitcointalk and found out about the technology behind bitcoin, Blockchain. Then obviously I found out about altcoins, and I was hooked so to speak. I always loved the start-up scene, because of their innovative ideas and their risky process of building a fast growing company from scratch. So I guess crypto was within my sweet spot of interest.

Doing a lot of research is one of the priorities. How much research did you do beforehand?

Yes, it certainly is. One of the tips I give out quite frequently, Always Do Your Own Research. I have been following crypto from around April till late July before I decided to invest myself. I’d say I read about 1-2 articles about blockchain & 1-2 about investing itself a day and checked the market prices around 5-10 times a day. It gave me an overall picture of cryptocurrency as a whole.

Investing in crypto comes with risk. What are the biggest risks in your opinion?

Yes it does, but the risk is a good thing in my opinion. It pushes you to do research and teaches you to get an overall picture of a project and its founders, advisors, and followers. There are multiple risks; typos that result in you sending your funds to a total stranger which will result in you losing all of them, security breaches at exchanges and hackers take all your funds or companies that are total frauds and scam you. But you can minimize all of these risks by triple checking addresses for typos, using hardware wallets and learn from other’s mistakes.

Especially the media is telling a lot about a big bubble. Do you think it’s a bubble? Why?

Oh the media loves the bubble story, great for clickbait. Whether it really is a bubble or not, I can’t really say. I don’t think so, I strongly believe in the tech behind and especially the people in the scene. I think if they stay motivated enough to make it work, then they’ll make it work. I believe technology always wins. But as I said, I don’t really know whether it is a bubble or not. It does show characteristics of a bubble, but then again, we live in a world that is changing so rapidly that the rules of the game might have changed. I don’t have enough experience with bubbles to form a well-argued answer to this question.

Why do you think cryptocurrency is the future?

I think cryptocurrency is the future because of several reasons. First of all, it makes it possible to send money, converted into coins, directly from person A to person B without anyone able to touch the funds in between. Second, crypto coins make it able to use platforms and applications on the blockchain; which is an amazing piece of technology. Third, in a world where we digitalise almost everything with the touch of a button we are getting used to instant satisfaction. And a well programmed decentralized system will always be faster than using a system with human links, and thus satisfying us quicker.

In how many years do you think crypto is more or less commonly accepted?

I doubt if it ever fully will. I think it’s hard for older generations to understand what is really happening, how the world is changing. There’s quite a lot of tech behind it and it might be hard to keep up. It might be more commonly accepted if the media would grow up and do more research, and produce articles about crypto with actual value.

What do you think Bitcoin is worth in about a year?

I’d say $30-35k. Might reach a higher all time high but it’ll probably correct around the same time this time next year.

There are many scams happening within the crypto market (ICO’s), have you been a victim of some? Or did you lose a lot on bad choices?

No, I haven’t been a victim of ICO scams. I haven’t lost a lot of money on bad choices either. Of course, I lost some due to bad choices but mostly I missed out on a lot of profit because of bad choices. Overall I’m in very good profit.

What would you recommend to future crypto investors?

Always do your own research. Only invest money you can afford to lose. This is crucial, because if the money you invested is money absolutely can’t afford to lose you will behave differently. Emotionally, and that is exactly where you lose. You will end up buying high and selling low. Also stick with your gut, if you believe in a project and you have valid arguments it will be something good then take the risk. Last tip: spread your risk. Put money in different coins with different levels of risk. (For example: 30% Bitcoin, 30% Ethereum, 20% altcoins & 10% ICO’s; all depends on your strategy)

 

Eric • second-year International Business Administration student

When and why did you start investing in cryptocurrency?

I started roughly in the summer of 2013 in Bitcoin. I played a game called ‘Runescape’, where there exists a virtual economy. You could fight monsters and earn in-game currency called Gold. You could also find other items that would make your character stronger. Of course, unique items were highly valued and people sold those items through PayPal to earn real money. Later, the Runescape community started to implement Bitcoin into its virtual economy, and that is where my journey started with bitcoin. However, as I held some bitcoin I experienced the Bitcoin crash related to Mt.Gox and sold all my Bitcoins. Later, I re-entered the Bitcoin market through another game called ‘Counter-Strike:Global Offensive’, where there were skins that you could buy, sell, and trade. I continued to accumulate virtual items and selling them for Bitcoins.

Doing a lot of research is one of the priorities. How much research did you do beforehand?

For Bitcoin specifically I have done exactly zero research. I have been in it for a long time that I understand the cryptocurrency well enough that I can introduce Bitcoin to someone that never heard of it. However, when I am willing to invest in another cryptocurrency I dedicate a good week reading about it and testing their wallet and anything else they provide beforehand.

Investing in crypto comes with risk. What are the biggest risks in your opinion?

I don’t believe that there are any major risks involved when investing into cryptocurrencies, as the possibility of losing your entire investment should be a risk already accounted for. You can’t lose anything else than your bitcoins.

Especially the media is telling a lot about a big bubble. Do you think it’s a bubble? Why?

I think many cryptocurrencies are in a bubble, but for the time being you can make money through cryptocurrencies. The reason why I think this, is because at the current moment a lot of new people have entered a cryptocurrency without reading their whitepaper. This only creates a positive feedback loop where the price continues to go up and people FOMO (fear of missing out), allowing the price to further increase and create more FOMO. Once there are no more people that invest into crypto the bubble pops. Did I just mention Bitcoin? No.

Why do you think cryptocurrency is the future?

If you learned about money during your history classes during High School I hope you paid attention. Before we traded with shells and stones and now we use paper money, yet in the recent years we have been commonly paying with credit cards. We saw the use of paper money 3000 years ago but it has been rejected every single time. Not until the 17th century we saw paper money used in Europe but it wasn’t the standard. It think people will start accepting cryptocurrencies for specific transactions.

In how many years do you think crypto is more or less commonly accepted?

Give it 5 very short years. With the innovation that Bitcoin brings I think 15 years is enough for Bitcoin to mature.

What do you think Bitcoin is worth in about a year?

$55,000, let me explain. Let’s use simple mathematics to solve this question. Using a linear growth trend on Bitcoin from day 1 to today, we can project a value of $22,500 in 2019. Using the exponential growth formula we can project a price of $200,000 in 2019. Not long ago, I found a very interesting study on a Bitcoin prediction for 2019, created by Xoel López Barata who uses the Monte Carlo simulation on Bitcoin and projects the price to be $55,000. I don’t necessarily believe using Monte Carlo could 100% predict the price but the outcome lies between my first two predictions and I am bullish on Bitcoin.

There are many scams happening within the crypto market (ICO’s), have you been a victim of some? Or did you lose a lot on bad choices?

I have never participated in an ICO, however I recently went to a Cryptocurrency Investor Summit, created by Success Resources. They promoted their own ICO through a very interesting marketing strategy. Also, from a report made by EY, we see that more and more ICO’s are not being funded by the investors. A reason for this is because there is a good chance that the ICO you want to invest in is a scam.

What would you recommend to future crypto investors?

For everyone wanting to invest into cryptocurrencies make sure to define strict rules for yourself. I don’t mean that you should never use a spoon again or never eat sauce. I mean to invest money that you can afford to lose. Invest in cryptocurrencies that you have done your own research. Do not trade based on emotions and feelings but rather define when you are entering the market and when you will leave the market. A golden rule for me is to talk to many people as possible to receive positive but also negative feedback on a certain coin. This can give me an competitive edge to improve my returns.

 

Are you interested in the Blockchain technology? Wondering what an ICO is about? Or curious about certain things that you didn’t understand in this interview? This April we will host a Speaker Series Blockchain event to answer all your questions! Colin Meulema from bitcone.io will be the speaker, so stay tuned for much more about this “future” technology!

 

disclaimer: this blog merely reflects the views and opinions of its interviewers and interviewees. our content is intended to be used and must be used for informational purposes only. it is very important to do your own analysis before making any investment based on your own personal circumstances.