BlocPal may be a big part of
the upcoming crypto revival
November 06, 2018 -- ADVFN Crypto
NewsWire -- Though PayPal’s Peter Thiel recently described Bitcoin
as “a reserve form of money – like gold” you wouldn’t
know it watching the duo’s prices. Bitcoin, the market’s most
established cryptocurrency, has plunged by nearly 70% this year,
seven times gold’s comparatively sleepy 15% correction.
But new technologies are famous for
their rocky beginnings. Take Commodore computers, one of the
leading personal computer makers during that sector’s infancy – its
demise certainly did not signal all PC makers were finished. The
1990s Biotech boom and bust is a similar story, just as the share
price of a 1990’s tech upstart called amazon.com is also
instructive. After rocketing from $1.50 to $86 – almost 6,000
percent higher, Amazon’s share price crashed to a more earthly $6.
What happened next, a 16-year parabolic ascent to a recent high of
$2050, is an example of what many crypto coin holders are hoping
for.
But compared to Bitcoin, Amazon’s
share price looks to have barely left the ground. Bitcoin’s low, in
June 2010, was less than a penny, while its high last January was
$19,875. Its rise exceeds a mind-numbing 20,000 times to the power
of three. Bitcoin was not alone. The market cap for the entire
crypto-coin space peaked last November at $828 billion, a more
subdued if you can call it that, 40 times its $20 billion value
less than a year earlier.
Amazon’s earlier crash translated
to a 93% share price haircut. Bitcoin has so far plunged 70% since
January. The entire crypto space, which is now valued at $195
billion, has fallen by as much. If Amazon’s initial crack-up and
the warnings of the sector’s more sober authorities are anything to
go on, yet lower crypto prices seem likely.
In Bloomberg, Ethereum’s Vitalik
Buterin says the rapid growth of crypto is moving to the stage of
“real applications of real economic activity.” He warns most
educated people have a superficial awareness of the industry so
there is little explosive upside left. It’s like a gold rush where
giant discoveries have already been made. The frontier is now
crowded with companies and people trying to do replicate the feat.
Greed eventually fades and fear for the mere viability of what has
already been discovered becomes the over-riding worry.
“Bitcoin and other
cryptocurrencies are useless”
The Economist, which is among the
world’s most respected financial papers, says fear is now “in
charge” and its recent leader “Bitcoin and other cryptocurrencies
are useless” does little to calm coin holders. The paper describes
crypto as a failed attempt to create an online version of cash that
eliminates “the possibility of interference from malicious
governments or banks”. Instead, they write, crypto is principally
used for speculation and is an “overcomplicated, untrustworthy
casino”. Poor security for users, volatility, complicated software,
zero consumer protection, and a dearth of merchants willing to
accept it are what the magazine sees as crypto’s fatal flaws. Not
mentioned are the often high and unpredictable transaction costs,
together with excruciatingly long authorization times, which add
further to its grim outlook.
“Everyone’s getting rich
but me”
But we have been here before. Major
publications have a habit of predicting market turns, but not in
the way one would expect. Recall 1995’s best selling book ‘Silicon
Snake Oil’and a Newsweek cover ‘Internet Blah’, both
which basically described the Internet as a bunch of over-hyped
baloney. By 1999 the same magazine performed a flipflop with a
cover titled“Everyone’s Getting Rich but me” when it highlighted
how easy making money trading internet stocks had become – with
little attention paid to the apparent risks. Perhaps more
ill-timed, The Economist’s post-crash March 2001
leader, ‘The Dotcom Wreckage’,warned that the Dotcom bubble’s
biggest stars’ best hope of survival was to find old-economy
partners – Amazon with Wal-Mart and eBay with Microsoft. And while
their opinion may look silly now, Amazon Chairman Jeff Bezos’
advice in 2001 looks even worse. The e-commerce mogul said
investors should not buy internet stocks including the shares of
his own company. At the time Amazon was trading around $7.77, it
bottomed a few months later at $5.80 and as they say, the rest is
history.
The Crypto ecosystem: 40
million to one billion people in 5 years?
In the midst of the current crypto
free fall, a fearless Coinbase CEO Brian Armstrong remains bullish.
He thinks that the total number of people in the crypto ecosystem
can reach one billion within the next five years, up from around 40
million today. He also sees an explosion in the number of tokens.
“It makes sense that any company out there who has a cap
table… should have their own token. ” Novelist Mark Twain
wrote that “During the gold rush its a good time to be in the pick
and shovel business”. Similarly, Armstrong’s Coinbase, which
provides the tools for crypto-currency trading, should do well if
his predicted rush to create more tokens occurs and the crypto
ecosystem grows larger.
In contrast, an ever-expanding
supply of tokens may dampen future token or crypto price increases.
This would be a welcome development as flatlined crypto prices
would discourage speculation, and more important, a lack of
volatility would make crypto-commerce less risky, thus helping
Buterin’s “real economic activity” become a
reality.
BlocPal –
the key to cryptocurrencies’ mass
adoption?
Volatility or not, a Canadian
company called BlocPal Inc. has developed an elegant
smartphone-based multi-currency platform it says will make using
crypto exceptionally convenient, and cost-competitive. And like
Coinbase, BlocPal stands to capitalize on the growing ecosystem as
it promises to make cryptocurrencies in general far more consumer
friendly. But Blocpal goes much further as its platform eliminates
virtually all of the barriers which prevent crypto from going
mainstream.
The company’s encrypted data
payloads and multi-sig transaction guarantees make BlocPal
ultra-safe while transaction costs are 1% or lower, making
micro-payments such as buying a cup of coffee a realistic option
for the first time ever. Transferring money or converting
currencies held in BlocPal’s wallet is instant and validation of
business transactions are in real time.
BlocPal’s bitcoin blockchain based
wallet is designed to hold any type of currency though it has
initially been launched with Bitcoin, Ethereum, Bitcoin Cash, and
Litecoin, Canadian Dollar and the US Dollar. Other crypto or fiat
currencies can quickly be added as demand requires. Having the
ability to easily and instantly convert back and forth from crypto
to fiat is a big plus not only for the consumer but also for any
merchants that may be worried that the crypto they have just been
paid might depreciate. Once the transaction is authorized a
merchant can use the platform’s auto-convert feature to transform
the crypto payment into another currency if she so chooses. Larger
businesses may wish to have their own branded crypto payment wallet
and can through BlocPal’s white-label service.
In “Life After Google: The Fall of
Big Data and the Rise of the Blockchain Economy” tech oracle
and Bitcoin cheerleader George Gilder compares Bitcoin to a massive
multiplayer online game which mobilizes millions of players that
validate or mine transactions – all beyond the manipulations of the
world’s central banks and their respective countries’ often
opposing national interests. This reality helps explain BlocPal’s
ability to develop what looks to be a transformational platform, as
its creators hail from the gaming business. The company’s ecosystem
is the culmination of decades spent developing a proprietary back
office payments system together with expertise acquired while
completing more than $30 billion worth of encrypted, internet
payment processing gaming-related transactions. Worth noting is
that they have never been hacked or suffered a data breach – an
especially relevant fact given that cryptocurrency theft by hackers
continues to plague the industry – the most recent being the theft
of $60 million worth of cryptocurrencies from the Zaif exchange in
Japan.
BlocPal’s advantage over other
systems is its simplicity as it eliminates the need for multiple
wallets by integrating a unified wallet to store and transact with
fiat currencies and all of the major crypto coins. Currently,
consumers have around 1500 currencies to choose from, many of which
are compatible only with specific platforms. For example, a single
Ethereum-oriented wallet can hold numerous ERC20-based coins, but
the same wallet cannot hold Bitcoin with all its forks, Cardano, or
EOS. Other wallets like the physical Ledger Nano S, allow users to
store most of the top coins, including Bitcoin and Ethereum, but
not fiat currencies and unlike the BlocPal wallet, which is free
and is downloaded onto a user’s smartphone, you actually have to
buy the physical Nano S device. Another plus is how easy it is for
merchants to integrate BlocPal’s platform into both physical and
online businesses so that consumers can buy their goods or services
with their BlocPal wallets. BlocPal can also provide associated
accounting and invoicing services to its business users.
Given that coins are in a free-fall
and consumer use is less than half what it was at its peak, BlocPal
has launched its platform just when it is needed the most. And
though Coinbase’s Armstrong is probably correct in predicting the
crypto ecosystem’s explosive growth, this alone will not translate
to the easy money made in the crypto space over the past few
years.
Nick Mellios the soft-spoken
founder of BlocPal says “we expect to reverse the current decline
in crypto use and instead accelerate the global spread of
cryptocurrency commerce as our solution makes the user experience
really pleasant. We want to make the consumers and merchants lives
easier by providing a nearly effortless, cost-effective and
worry-free solution”.
From an investor’s viewpoint it
will be a challenge just to keep things in perspective and ignore
the kind of pessimism that prompted even Bezos to dish his own
company in 2001, and to instead, with a cool head, identify the
next major tech success story.
BlocPal’s central role in
making crypto an online alternative to cash.
It is improbable that we will see a
repeat of 2017’s massive coin price moves just as Vitalik Buterin
infers. A more reasonable expectation is that for the foreseeable
future the big money will be made owning stakes in companies that
make crypto an integral and viable part of real economic
activities.
This is where BlocPal comes into
the picture. The company has the all the makings of the next great
success story as it possesses a massive advantage because, while it
does not compete directly with any of the coins in the crypto
space, its business instead focuses on radically improving the user
experience for a multitude of coins in the crypto
ecosystem.
It will take time, but if BlocPal’s
platform is as successful as looks likely, we may just yet read
in The Economist that crypto has finally evolved from
being a failed attempt to create an online version of cash, to
become a compelling online alternative, with BlocPalplaying a
central role.
Neil Maedel is a South East Asia
based venture capitalist with an extensive multi-decade background
in finance and analysis of micro-cap companies. Beginning as a
trader at the Vancouver Stock Exchange, market researcher and later
an editorial writer for Canada Stock Watch he founded the Minicap
Analyst financial letter and Protrader Finanz AG, in Zurich,
Switzerland which assisted in financing micro-cap companies
globally.
Disclaimer: This article should not
be taken as, and is not intended to provide, investment advice.
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subcontractors are cryptocurrency investors and from time to time
may or may not have holdings in some of the coins or tokens they
cover. Please conduct your own thorough research before investing
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