I recently joined reddit and I subscribed to a bunch of crypto communities and I also follow some exchanges like binance or crypto.com. It is common to read about users being unable to withdraw their funds. For example just recently I read about a user that after depositing about 1000$ worth of BTC in his crypto.com account was unable to withdraw because that transaction was flagged as unusual and crypto.com demanded further verification of the user's identity before allowing him to access his own funds. Most of us are in crypto because we don't want to deal with banks but exchanges are behaving like banks more and more over time. The saying "Not your keys, not your crypto" holds true. If we simply wanted to exchange crypto we could use some DeFi platforms but exchanges offer some favorable perks like juicy interests if we stake certain coins.
Here there is a video version of this post:
Some opportunities are truly interesting but you have to deal with very long staking periods (up to 180 days with crypto.com) and of course you don't really own your crypto until you get them in your own wallet. Moreover, exchanges like crypto.com can arbitrarily change the interests they pay with little warning, making it difficult to plan and implement effectively your own risk management considerations. So I was looking for crypto I could stake without having to hold them into an exchange. I am not going to mention the very popular ones because you likely heard of them and there are many good opportunities out there.
Before revealing which coin I am talking about, I just wanted to clarify the criteria I used to look for it:
- It should be below the 100th position by marketcap (if marketcap is already high, there is not much upward potential)
- It should be undervalued or have interesting prospects
- it should give a yield above 5% APY
- It should have real use-cases and not be exclusively a DeFi-centered project
To clarify my last point, I am bullish on DeFi but there are just too many projects out there and I don't think most of them will survive the test of time, just a handful will be able to remain viable. Therefore, picking a low marketcap DeFi project is extremely risky in my view. Moreover, there is a lot of speculation in crypto and many coins have redundant functions, most of them are centered in financial services. However, the economy is not only based on finance. There are things to make, problems to solve and finance just moves capital and value from one place to another without really producing value. Thus, you need a strong economy and value-producing activities to have a flourishing financial sector otherwise you will keep getting bubbles. I believe we need the same healthy balance in crypto. For this reason I like to invest in projects that can have real uses and help solve real problems.
A while ago I read about Fetch.ai and it sounds really interesting, let me explain why:
One thing that we learned after Covid19 is that because of globalization, our supply chains are really fragile. Goods have to travel long distances, change many hands and even a small disruption in the supply chain can create havoc and cause shortages. American companies manufacture cars in Mexico, but to do so they need to get the components from China. Chinese companies need steel from India and oil from the middle-east, so a failure in any of these points can cause the total disruption of the chain and all of a sudden there are no new cars in the market. The inevitable trend is that companies will rely less on individual workers and more on automation. Software and machine learning are already taking over many jobs and this is just the beginning.
Because of these considerations, it makes sense to diversify and invest at least a small portion of my portfolio in projects related to machine-learning and artificial intelligence. This is what Fetch.ai is all about.
The Fetch.ai project plans to build a network of autonomous agents that can represent individuals, devices or services. These agents use artificial intelligence to work independently or to communicate with one another, learning and evolving in the process. I have a background in biology and this reminds me of a phenomenon that is widespread in nature and it's called Emergence.
When an entity is composed of many parts, and these parts can communicate with one another and influence their behavior we obtain a system that has superior properties than the ones of the individual parts. Basically, this is how stupid entities do smart things, people also call it collective intelligence and it's a very powerful phenomenon. We are included in the definition of emergence. We are composed of trillions of cells, if you were to take a single cell you won't observe any smart behavior, but if you put this cell in contact with other cells, they will collectively form a smart system and influence each other's behavior and respond to external stimuli. Just imagine if Fetch.ai connects smart contracts (which are not so smart if they are isolated) to their agents, if then you provide the system with the ability to learn and evolve you can obtain a powerful entity.
What are the use-cases for Fetch.ai?
- Enable the development of driverless cars: a major issue in driverless cars is that they need to sense and recognize many things in their surrounding environment. With Fetch.ai smartphones, other cars, traffic lights and many other objects on our roads can become agents and communicate with other devices, enabling driverless cars to make decisions faster and without requiring as much computing power.
- Smart parking: the agent in your car can communicate with other agents around the city and let you know where there is a free parking spot available and even pay and reserve parking space for you. Check out this video for a better overview:
- Improve logistics of supply chains: Discussed quite well with an example in this video:
- Collective learning: helping doctors making more accurate diagnosis and faster:
- Decentralized transportation agents: An agent could help you scheduling your travels:
What about staking?
In the beginning of this post I mentioned staking and probably this is the part that interest you the most. There are a few ways to stake with Fetch.ai, their token is FET and you can buy them in some of the major exchanges like binance, crypto.com and bitfinex.
Staking the lazy way: After buying your FET tokens on binance you can simply put them to work in a flexible saving account and they will earn you 1% APY.
Staking the effective way: FET are ERC-20 tokens which means that you can simply send them to your MetaMask wallet. After doing so you can go to https://staking.fetch.ai/#/ and link your MetaMask wallet. The current APY is 10%, I've tried to stake a small amount and the interests are credited immediately in your account but they appear in your staking balance. The good thing about this is that you can take full advantage of the compounding interest, so over time your yield should grow exponentially. The disadvantage of this is that there is a lockdown period of 21 days if you unstake your tokens.
Please be aware, that because FET is an ERC-20 token, there are considerable fees associated to moving your tokens around, investing small amounts may not be worth it because of the fees. Fetch.ai is a very interesting project in my opinion but you should consider it as a risky investment and as such only invest amounts that you can afford to lose. To date, there are only a few prototypes of real life examples of what fetch.ai can do, more are being rolled out every day and I was very pleased to see that there seem to be quite a bit of activity by their developers in their github account:
However, if you look at the price action of the token in the past year things look kind of grim, since its launch the price of the token went down a lot. On the flip-side projects powered by Fetch.ai are just starting to be rolled out and more are about to come, so it may be still early to judge this token by its price, there is potential but there are also risks.
I've personally invested just a tiny amount to play with it. If things go well the token can appreciate considerably, and if the project fails I would not lose much anyway. This is what I thought when I bought ETH at 7$ per token several years ago and it worked out quite well.
*Disclaimer: I am not a financial advisor, in this post I shared just my opinion and as such you should do your own research and make your own considerations. THIS IS NOT A FINANCIAL ADVICE. The goal of this post is just to trigger discussion and learn about new projects out there.