Cryptocurrencies that can make millionaires ?
Cryptocurrencies that can make millionaires in minutes are justification enough to get out of bed at 5am to gamble
Bitcoin envy, the ultramodern malaise. News reports are full of this magic internet money’s rocketing value – currently, $16,000 – and Facebook is dotted with people who picked some up at $500, $50 or even 50 cents. But the cryptocurrency ship hasn’t yet sailed. In the volatile market of alternative cryptos, relatively unknown alt-coins such as ripple, litecoin, and ethereum regularly shoot up by hundreds of percent in a matter of weeks and plummet just as fast.
Bitcoin envy has brought in vast sums of new money, dollar-eyed investors taking a Las Vegas gamble on which of the more than 1,000 alt-coins might rocket next. In September the cryptocurrency market cap was $137bn. Today it’s $800bn. It’s a blockchain gold rush.
In mid-December, a Facebook friend well-versed in crypto tipped Cardano’s ADA, which at 21 cents was just the tip I was after. Little did I know I was riding unarmed into a lawless digital wild west, where fortunes are made and lost on a tweet.
Every shill, trickster, bot, and conman is using all the unregulated tricks in the book to make a fast buck. And this was undoubtedly my first rodeo.
For a form of currency designed to wrestle financial control away from centralized banks and governments and back into the hands of the people, there is a surprising amount of red tape involved with buying cryptocurrency online.
It took me two days to pass security checks on depository Coinbase and crypto exchange Binance and scour Reddit to find out how a digital “wallet” worked. One night my wife woke me at 5 am: ADA was 51 cents and rising fast. I scrambled for the laptop and bought all the ADA I could.
Rookie mistake: the Fomo – “fear of missing out” – buy. The pump quickly turned to dump – a regular cycle in cryptocurrency – and ADA drifted painfully downwards. With my very first trade, I was that most maligned of crypto trader noob – the top-buyer.
Let loose in this cyber-cash chocolate factory, I browsed further. Avoid the vast number of scam “shitcoins” floating around and the potential is clearly enormous. If bitcoin is the Atari of internet money – a slow, first-generation technology with heavy fees – then the faster and cheaper ethereum and litecoin are its ZX Spectrums, and the crypto community is jostling to discover the third-gen PlayStation, with each new alt-coin designed for an innovative purpose.
Due diligence is key: you’re looking for a respectable team with an innovative project that could eventually reach mass adoption, a strong support community and a bargain price for a coin with a small circulating supply.
John McAfee, head of McAfee Antivirus and a major voice in crypto, tweeted, “it is easier for a 3 cent coin to go to 3 dollars than it is for a $300 dollar coin to go to $30,000”, so I looked to the cheaper coins for my future fortune. Most intriguing was a five-center called verge (or XVG), tipped by McAfee as the next big privacy coin.
Several years in development, verge was created by a team of volunteers led by head developer Justin Vendetta and were promising the imminent release of Wraith Protocol, a means by which users can make a transaction with verge either public or untraceable at the flick of a switch. You could pay your gas bill and run a Mexican drug cartel with the same currency.
Verge was already a phenomenon. On the back of a single tweet from McAfee, the price had shot up 2,000% in a couple of days. Almost 30,000% in 2017; $400 of verge purchased in January would now be worth $17m. With McAfee claiming Verge could hit $15 in a year, it sure looked like the future. I grabbed me a hefty chunk.
I wasn’t alone. All of crypto’s shadowed eyes were on the verge. Its bullish community of supporters filled Twitter with entreaties to HOLD – hold on for dear life – until it goes “to the moon” and everyone can buy “lambos”.
Within a couple of days, as the hype about Wraith Protocol’s spread and firm promises were made that it would be released before 2018 was rung in, the price tripled. On the day bitcoin crashed to $10,000, taking most of the market with it, verge soared, hitting almost 30 cents. Graph readers were suggesting the release of Wraith would shoot the value to 70 cents or more.
I found myself obsessed, constantly monitoring Twitter, waking in the night to check coin tracking apps. Pundits were hailing verge as a game-changer, the next bitcoin. Unbelievers pointed to previous missed deadlines and called it “vaporware”, a nonexistent con, the biggest scam in crypto history. In this unprecedented hype, there was clearly unprecedented money to be made.
And more than one way to make it. Three things hold sway over these unregulated crypto markets. Coin innovations, bitcoin whales manipulating prices with huge pump and dumps, and social media.
The merest hint of FUD (fear, uncertainty, and doubt) on a coin’s Twitter or Reddit threads can tank its price quickly. As the final days of 2017 slipped by with Wraith Protocol still unreleased, the FUDers went to town on the verge.
A crypto tipster named Marquis Trill tweeted his 4.6 million followers on Christmas Day to “sell XVG!”, claiming he had proof from a Reddit whistleblower that the Wraith Protocol project was falling apart. The price plummeted, only to recover again when Trill claimed his Twitter had been hacked and the allegation proved false.
In the dip, a new verge wallet was opened and 2bn coins were purchased, 14% of the supply. Someone, somewhere, on the back of just two tweets, had made millions of minutes. If that wallet suddenly emptied when verge went to the moon on the release of Wraith, one commenter suggested, it would be “the heist of the century”.
Then, on 27 December, McAfee posted a tweet claiming his prediction of a future $15 price for verge had come from a fake account. That he’d only ever claimed it would reach 15 cents. Verge’s price dropped to that amount.
In retaliation, on 30 December, the coin’s highest-profile Twitter supporter XVG Whale posted a series of texts claiming to be from McAfee. Demanding the team give him more than $1m in ethereum or he’d tweet the coin into the ground.
New Twitter accounts were opened, tweeting FUD about verge 170 times a day to drive the price down. In the dips, that monster wallet grew by 2m coins every half hour.
Dark forces were at work, and all us minnows could do as the days ticked by was strap ourselves into the Wraith Protocol rocket. Then we hope that come midnight on New Year’s Eve, its release would shoot us moonwards. For verge, and my fledgling portfolio, this was death or glory.
At 5 am on New Year’s Day, I and thousands of #Vergefam sat hunched over verge’s Twitter feed as eagerly as Beyoncé fans awaiting a surprise album drop, counting down the ball in Times Square. Five, four, three, two, one … nothing.
Like thousands of others, I hit the sell button; the price dropped 3 cents in as many seconds. Then a tweet from Vendetta citing a last-minute bug steadied the price. Then I bought straight back in, but the short-term profit seekers had hopped off. When Wraith Protocol arrived four hours late, a site quickly popped up claiming to have hacked the first batch of IP addresses from it.
By the time this was proved to be fake news the Verge price had dwindled to 13 cents. Thats the momentum of cryptocurrency’s biggest moment was lost.
Then a minor miracle. Once the FUD cleared and Wraith was shown to work exactly as promised. Verge’s price rallied to about 20 cents, with tipsters predicting it to hit $1 in the coming months. They might be a small band of developers with poor PR being buffeted by the malevolent winds of crypto. But verge is the game-changer, not the scam.
So, yes, the bitcoin bubble might soon burst, bringing this whole, wild rollercoaster ride off the rails. But I’ll be holding my verge for a year or two. Meanwhile, ADA quietly hit $1.20. Perhaps I’ll be opening that Lambo dealership on the moon yet.