In these very turbulent times in the cryptosphere, when I am asked how I see 2022, I am automatically presented with the famous novel by Charles Dickens “A tale of two cities”, published in 1859. It is the story of life in the eighteenth century, before and during the French Revolution, told in the form of a novel that takes place in two cities, London and Paris. In London, everything was peace, tranquility, simple and orderly life. In Paris, on the other hand, everything was agitation, defiance, chaos, terror. At the same historical moment in which dramatic social changes were approaching, a few kilometers away, totally different realities were being experienced.
This analogy occurs to me with the current situation of our beloved cryptosphere. Few of us still choose to live in the chaos of the decentralization revolution that Satoshi Nakamoto proposed as a strategy in his White Paper 13 years ago. Everything is chaos, agitation, defiance, terror. We are also on the eve of dramatic social changes, and the fall of banks, corporations, and tightly centralized structures appear inevitable for new generations. It is not a matter of "if it will happen or not", but of "when" it will happen.
On the other hand, there is still the corporate world, "peaceful" and "orderly", in which everyone obeys the orders given by 25 people who run the world through a network cleverly built in the last 150 years. Most of the planet's inhabitants do not know that they are being managed, so this world seems "normal" and, by extension, "legal".
It is as if two Metaverses coexist that are "real" for the inhabitants of each one, and that interact in an unclear way at the moment, basically, because they do not understand each other.
I don't see this particular point changing much in 2022. There are a lot of conflicts in the world, magnified by this pandemic thing that doesn't want to go away. There is even a hypothesis of war in Europe! I do not think much progress can be made in making a good portion of the world's population that has not yet had contact with the cryptosphere understand that it is a new class of assets that had never existed before and that decentralization is good for society. The only way to fight against the mass disinformation media that lives thanks to maintaining the status quo, is to carry out a one-to-one evangelization, P2P, and to start a kind of viralization of the concept in the younger generations. But for that, it takes much more than a year. I don't think that, at a strategic level, the situation in the cryptosphere will change much.
On the other hand, and always speaking in strategic terms, I am very struck by the sudden disappearance of news about quantum computers that occurred during 2021. Surely we cannot blame the pandemic for this. Of course, development is going on, hand in hand with holy monsters like IBM, but there wasn't much noise about the cryptosphere being gone when quantum computers come out of the lab and the world starts using them. It is to be hoped that the issue will be dealt with more forcefully in 2022.
Another protagonist that we can expect to be the star of 2022 is Meta, ex-Facebook. It has just announced its artificial intelligence supercomputer which it will surely use with its usual marketing power to fire up the Metaverse (its own, of course). I particularly expect an exaggerated marketing campaign to promote this monstrosity, which, unfortunately, can make a lot of biased noise in the cryptosphere.
In addition, and this is very strategic, there is the issue of the behavior of the whales. We must never underestimate the behavior of whales and their ability to move the market. Especially when we look at who the whales are. There's an excellent post by Mike Ermolaev here on Publish0x about it. According to his research and BitInfoCharts, only three BTC Wallets, own 3.03% of all Bitcoin in circulation, and the top 100 wallets hold around 18% of all BTC. The whales have disturbing names: Satoshi Nakamoto (has over a million BTC), the Winklevoss twins, Michael Saylor, Tim Draper, Changpeng Zhao...
What has been analyzed so far is at a strategic level and these are the issues that I am going to follow closely in 2022.
But the tactical level is much more interesting and dynamic. I always say that Satoshi Nakamoto showed us the strategy, the beloved decentralization. But the tactics depend exclusively on us and all operators in the cryptosphere, from programmers to investors.
I believe that there may be great advances at a tactical level in 2022. These are my most specific reflections regarding the cryptocurrencies that I have chosen for my portfolio. That is the tactics with which I intend to grow and make the strategic concept of decentralization known.
I once wrote about Bityard in another contest launched by Publish0x a couple of years ago.
It is amazing to see how simple and accessible to anyone Bityard managed to make known, understood, and encouraged the use of the intricate world of futures and options contracts. I have been a user of the copy trading solution ever since, with the aim of learning something more every day from experienced futures traders. I dedicate a couple of hours to this in the morning, two or three times a week. At the moment, I don't know of another Exchange that does a similar thing.
I trust my gut more than charts and patterns (with all due respect, of course). I believe that the market capitalization of the cryptosphere will continue to grow, as governments and international organizations continue to put more and more obstacles. At this point in the match, and assuming a ZugsWang position, the obstacles already sound ridiculous, it's almost like trying to stem the tide with a floor dryer. The restrictions only scare FUDers and those who got into this to get rich quickly. Meanwhile, the whales are not selling and institutional investors are still buying. It is simple. You don't have to think much.
I could not specify the growth of the main currencies during the year, but I can be sure with 100% certainty that the following four things will happen:
1) China is going to ban Bitcoin once again
2) Many morons will continue to write posts about how Bitcoin wastes a lot of energy and that it is not eco-friendly
3) The BIS, the IMF, and the World Bank are going to say once again that cryptocurrencies are a threat to international financial stability, especially focused on El Salvador
4) People will flock to buy CBDCs from their respective central banks (hahaha, no, I'm kidding)
Image by Perlenmuschel from Pixabay
As for the coins that I think will have a pump during 2022, I am inclined to think that Bitcoin will regain its firepower by surpassing the 50% dominance of the market again (as of writing this in January 2022, it is by 42%).
Ethereum will also continue to be the king of smart contracts in 2022, although its transition to PoS is still uncertain. But the big difference is that now it has Solana, Polkadot, Algorand, and Cardano much closer, which have the same intentions and are advancing by leaps and bounds to compete closely with it. We cannot know what the smart contract ecosystem will be like in a period of 5 years, what we do know is that Ethereum will not be alone, and that, in my opinion, Algorand will be a great star in the short term.
But my favorite is VeChain and its VET and VTHO coins. A couple of years ago I discovered this project and I've been betting heavily ever since. I have high expectations for the growth of this currency in 2022 and in future years.
VeChain and its VET and VTHO coins try to solve the enormous challenge facing logistics in all industries, maximized by the pandemic, by bringing Blockchain, Artificial Intelligence, Big Data, IOT, Machine Learning, SCaaS (supply chain), and QuickCommerce.
The challenges posed are enormous. On the one hand, consumers, somewhat driven by the pandemic, suddenly changed their habits and behaviors, and require immediate attention (quick-commerce) by stopping worrying about other things, such as the price of what they are going to buy.
On the other hand, the advancement of IOT technology is overwhelming. Despite the inconveniences that the pandemic brought to commerce and the supply chain, the number of devices connected to IOT exceeds 12 billion and continues to grow at a sustained rate, forecasting that by 2025 there will be more than 27 billion connections of IOT devices. This growth is undoubtedly driven by the cloud-computing ecosystem, and there are competing heavyweights like Google.
IOT doesn't just mean that the home refrigerator and air conditioner can be controlled from the cell phone. The concept is much broader, which is why advanced issues such as Big Data and Machine Learning are involved.
A recent example is a process developed by VeCHain in conjunction with the Chinese government in the food industry.
China's government has long been concerned with oversight of its food system, considering that country's huge population. The concern goes through the constant improvement of the traceability and safety of the national food industries. At the beginning of 2021 VeChain was called to build a government traceability platform. There are already 12 companies that have been successfully interconnected to ensure the traceability of the agricultural products they manufacture. The generation and storage of data is enormous and the algorithms that relate this data are in continuous improvement and adaptability. The process is just beginning and a huge national interconnection is expected, at the low cost that characterizes VeChain.
Imagine the same for the assembly devices of industrial plants, or for the logistics platforms of department stores, ports, shipping companies, and the list is endless.
I think there is a big challenge to automating everything that has been built by the industrial revolution in the last 150 years, as we enter the famous era of digital transformation. VeChain understood this problem in the year 2015 when a manager of Louis Vuitton China, Sunny Lu decided to launch this project. Lu remains the CEO of VeChain through the VeChain Foundation.
VeChain initially started with a token called VEN, an ERC-20, but later developed its own blockchain called VeChainThor and its own VET cryptocurrency. This in turn generates a second token called VeThor or Thor Power, VTHO. By the mere fact of having VET in the wallet, VTHO is generated periodically. Basically, VET is a token designed to transfer value and make operations on the VeChain, while VTHO could be considered analogous to Ethereum gas, that is, it is used to cover the costs of sending transactions on the chain, implementing smart contracts, and running dapps.
I do not know of a project as comprehensive as VET for the logistics industry and its digital transformation. I think it will undoubtedly be a great protagonist, not only in 2022 but in the next 10 years.
My plan is to continue buying VET throughout the year. Half of what I buy is left on the exchange, and the other half is transferred to my VeChainThor Wallet. I have no doubt that we are heading as a civilization towards a world interconnected by IOT, Cloud Computing, Artificial Intelligence, and Blockchain, and that the supply chain is one of the industries that will receive the most benefits from these new technologies.
My plan is at least ten years. I am not concerned about the price of digital assets, but about their value proposition and about the team that manages the project. I have BTC, ETH, ADA, SOL, ALGO, and DOT. I don't care about its price but what its core business can represent for the economy in the next 10 or 20 years.
A few years ago I coined the term “look at the labyrinth from above” for my college classes. The concept is based on differentiating strategy from tactics using the figure of a labyrinth. When you are inside the labyrinth, it is very difficult for you to see the exit. You have to sharpen your tactics to try to find a way out. On the other hand, if you make the effort to make a strategic look, that is, if you look at the labyrinth from above, then it seems very easy to find a way out, you can see it with the naked eye.
More than 20 years ago I began a good deal with this concept. In the midst of the chaos that the arrival of the Internet brought with it, with most of the operators who did not understand what it was or what it was for, I reasoned that the enormous generation of data that came from the hand of this new technology was going to need, among other things, from a large number of storage devices. I thought that the companies that made digital storage devices were going to grow a lot in value. I analyzed the companies and I leaned towards Oracle. I bought Oracle shares at $5 before the millennium ended and today they are over $80.
The situation is very similar to me today with VET.
Actually, I do not think that the mass adoption of cryptocurrencies is a question of if it will happen or not, but when it will happen. The same goes for the adoption of blockchain and related technologies across industries. I see logistics as the industry that best understood the problem, making governments understand it in turn. That's why I chose VET. We will see what happens in the next 10 or 20 years.
To finish, I leave my referral link on Bityard.
As usual, none of the things written in this post are financial advice and are not intended to replace personal research.
Thank you for reading!
If you have any questions or comments, please feel free to leave them down below
You can also contact me at [email protected]
Substack Anarchy: the Final Solution https://gerardosaporosi.substack.com/