ETH Pushes Lower; None of this Matters

After spending the last few days hovering between $580-610, ETH looks to be dropping this morning.

Last week I thought we would see a quick recovery this weekend.  Oops.  It appears this latest “bear cycle” is legitimate.

I was wrong about last week.  I thought ETH was clear towards a big summer.  That said, I’m still incredibly bullish for the next few months.

Short-term Price Prediction 

I think we see a bit more downward movement this upcoming work week – mid $500s, testing $500 potentially – before a sharp recovery starts June 1st / 2nd.  (Friday/Saturday)

I feel really strongly about this.  My gut says June is a huge month and good times are near.

Don’t believe me?  Bro, I’m from the internet.

Need triangles?  /u/OperationNine has you covered:


None of this really matters though…

This is just stupid price speculation in a highly volatile, manipulated market.

What matters is the ridiculous potential of a ‘decentralized world supercomputer’ – which is what Ethereum is.

For me it’s clear that new decentralized supercomputers like Ethereum are about to fuck up all types of business models.  This is why I left my job, I need a front-row seat at the carnage.

Decentralized Supercomputers are Game Changing

Ethereum is essentially an extremely powerful super computer composed of different individual computers from around the world.

In the future, companies will be able to leverage the combined computing power of the Ethereum network to do computer-intensive tasks.

Right now companies pay millions to Amazon, IBM, and other centralized computing farms for “heavy compute” tasks, for example mapping the human genome.

Currently there is a serious shortage in computing power.  At the same time there are tons of unused computers now all over the world doing nothing.  What if those could be tapped into?  And monetized by their owners?

Think about when everybody is at work – most people have a home computer / laptop that is sitting idle.  In the future – if individual users are “paid” to contribute computing power – people will have their computers “working” for them while they’re at their job.

A network like Ethereum – and projects being built on it like Golem, SONM, and iExec (and soon Hypernet) – is aiming to do just this.

Improving the “Sharing Economy” 

In a way it’s very much like ‘AirBnB.’  There was demand for affordable places to stay while traveling +  a supply of unoccupied apartments.

AirBnB facilitated this type of new “sharing economy”

But I take major fault with the concept that this is truly the “sharing economy”  (h/t Brenden Eich)

These are “centralized matching services” that take a signficiant premium for people using their services.  In Web 2.0 this makes sense as these companies provide value in security/protection/insurance.

While AirBnB and Uber have disrupted hospitality and the taxi industry – they are about to be disrupted themselves!

In the future, decentralized versions of these companies will exist, and their model will take SIGNIFICANTLY LOWER fees than a centralized service like AirBnB.

This is the true future of the “sharing economy” – one where the value is better retained between buyer and supplier.  Death to the middlemen.

[By the way, this is currently being built, the most promising one to me is BeeToken – ex-Uber/Facebook/Google people behind this.  Overall it’s a great sign when you see people from the best Web 2.0 companies leaving to build their own Web 3.0 projects.]

Building a Better Internet (Web 3.0)

As I’ve said before, A new internet is being built.  This is not just a Silicon Valley TV show joke.

This is real, and it’s amazing.  And right now Ethereum is leading the way.

What excited me most about this “new internet” was how much it improves upon the current one, which has some major flaws.

This is a core argument for the majority of new websites/applications being built on Ethereum.  Joe Lubin, founder of Consensys and co-founder of Ethereum, agrees:

Ethereal 2018 Keynote

Some of the flaws in Web 2.0 have been haunting me for over a decade.

I’ve always been concerned around the lack of user privacy, lack of user controlled data central to the model of the current Web 2.0.

In 2008 I wrote something called ‘The Universal Social Network’ that called out Facebook’s issues around this, in context of why ‘Facebook’ wouldn’t become the ‘Universal Social Network’:

User privacy concerns / Default privacy settings

Facebook has shown many times in its short history that it isn’t afraid to infringe on its users privacy. Although Facebook claims that user privacy is one of their main principles, Facebook’s privacy controls continue to be inadequate and its default settings are irresponsible.

Facebook’s default settings are always set to expose as much information as possible, as opposed to letting users decide for themselves how they want their information used on Facebook. When Facebook releases a new feature, users need to “opt-out” if they don’t like it, rather than include themselves because they want to try it.

In the Facebook TOS they own all user generated content on the site, which doesn’t have to be the case. Facebook is the owner of our photographs, messages, anything we create on the site.

Facebook ended up creating a big mess 

I’ve pretty much had a vendetta against Facebook for over 10 years because of their brazen disregard for user privacy.

I even registered the domain ‘’ in 2007!

Watching Facebook “get rekt” over the past year has been a little cathartic but ultimately that’s just self-serving.  I did nothing to stop what it became.  Which was a monster.

When I started learning about Blockchain technology I didn’t get it at first.  Conceptually it’s confusing.  I started learning about Bitcoin – digital money – but then I discovered what other kinds of use cases the technology enables.

It’s clear that blockchain is the ultimate technology to enable the types of platforms I was imagining a decade ago.  And I’m not the only one who thinks this way.

As I type this a better internet is being built.  One where the user is back in control.

Moving from Web 2.0 -> Web 3.0

As I mentioned earlier, we are currently living in Web 2.0.  And in this ecosystem Users are the product.

It’s our private data, our information that companies like Facebook are using to monetize, often with deceptive collection methods.

During Blockchain Week I heard the phrase ‘Surveillance Capitalism” used a few times.  That term basically sums it up.

Ethereal 2018 Keynote

Web 3.0 will be different!

Because of the new functionality of “trusted transactions” and “automated agreements” there can be significant disintermediation into current business models.

Ethereal 2018 Keynote

This has huge ramifications for how the internet will evolve.

Certain Markets are Begging for Disruption

Online advertising is a great example.

Currently so much value is lost to middleman in the online advertising industry that it puts major pains on both Advertisers and Publishers.  (and as mentioned earlier the users are treated like crap)

Projects like Brave Browser and Basic Attention Token aim to completely change how internet advertising works by creating a more efficient marketplace.

In the Brave/Basic Attention Token vision – the middlemen are removed and the value is better distributed among the 3 parties:

In this model, because of disintermediation, there is enough reclaimed value that the User can actually be compensated.

Users – instead of being taken advantage of – now can use a privacy-based system where they can enable ads and actually get paid to be exposed to them!

This is just one example.  A more ‘X-rated’ use-case is the adult webcam industry.  This is an industry where the centralized websites that take a massive % of revenue from it’s contractors.  A blockchain based decentralized infrastructure has the potential to massively change that.  Performers who have been forced to accept losing 50% of their tips will see things improve by an order of magnitude (~5%).  [SpankChain, launching in June]

Another example is gambling.  Right now centralized gambling sites take a 10% premium on bets.  In the near future decentralized gambling will massively reduce that % – endangering the business models of the current centralized industry leaders.  [Augur, launching July 9th; FunFair launching in June]

I can’t understate how massive decentralized gambling is going to be.

When tech advancements – the internet being a great example – it’s usually the gambling/porn industries that are first to innovate.

The dAppening is Coming

These new ‘websites / projects’ – which were never possible before the invention of blockchain technology and smart contracts – are called ‘dApps’ (decentralized applications)

Some of these dApps have been in development for years – Augur for example – and now they are finally about ready to launch.

These early dApps are really experiments – first versions of their concepts that very well may fail or break.  That excites me about the whole space.  Building things that have never been done before.

That said, there are already some very interesting dApps already live on the Ethereum mainnet.  My next post will explain how those work, and how you can start experimenting yourself with the Ethereum blockchain.

To sum it up, the dAppening is coming (when mass audience starts interacting with a dApp) and faster than people think.

Ethereum – a Playground for Nerds

Right now interacting with the ETH blockchain is kinda like a nerd fantasy world.  It’s an incredibly small community – which I think is both good and bad.

Good in that the userbase is incredibly passionate.  Also with ETH’s current scaling limitations it can only handle so many users.

Bad in that our community is sooo small and insular.  We NEED people from the outside to be learning about this and helping.

Currently, we – the early adopters – use our own browser (or browser extension) that allows us to interact with the Ethereum blockchain.  We’re experimenting with the protocol in different ways – like playing games, rendering video files for profit, creating a CDP (Collateralized Debt Position), and much more.  It’s really cool stuff.

Over the next few months users will be able to start gambling.  That is when shit is going to really start getting real.  I think it coincides with a big price move.

How does ETH become Mainstream?

Currently interacting with the Ethereum blockchain is still too complicated for the masses.  But that’s OK for now.

Companies like Consensys are building the tools that will facilitate mass user adoption.  Every day the experience is being improved upon.

The key is building applications that are seamless and naturally integrated.  It won’t feel like you are “using” the blockchain.  It will just feel like another app.

We aren’t close to that point yet – in fact we’re still years away.  But I can’t wait to follow the progress and contribute myself.

These are exciting times.  The price doesn’t really matter.  The technology does.  The price will eventually reflect the value of the technology.

This summer is going to be huge.  For adoption and for the price of ETH.

I leave you with an interesting CNBC segment from Fast Money on Friday.  I don’t agree with everything the person being interviewed says, but it’s interesting:  (especially the very end)

Times are changing.  The Herd is Coming™.  Crypto isn’t going anywhere.

Weak hands get rekt.

What’s Going on with ETH?

The price of ETH appears to be free falling right now!  Apologies for not writing for awhile, this is definitely a timely post.

With all the good news coming out about Ethereum over the past 2 weeks, how could the price be “tanking” like this?

What I think we’re seeing now is an over-reaction to the “Consensus / Blockchain Week” non-pump.  (pump = big, quick increase in price)

There was an expectation that Blockchain Week would lead to a big increase of price, which it has in previous years.  This year the prices across crypto remained stable during the conference and now are dipping heavily this week.

Right now ETH is at $583 on GDAX – down over 14% for the day, and almost 19% since Monday, ouch!

It’s not only ETH, it’s the entire crypto market –

Market sentiment changes quickly in crypto.

Since it’s still 90% “Retail” (aka. non-professionals) the market is incredibly emotional and tends to overreact.  This is why we can have -20% days like today.  It’s the same reason I’m predicting +20% days in the future.

Judging by the conversation online, my gut says this is actually a buying opportunity.

I’m not sure where the bottom of this movement is – my guess was the high $500s – but we could see lower $500s.

This feels like a “fake-out” – one last emotional downswing / final test before a huge bull run this summer.

I could be wrong, but I don’t think so.  I’m a buyer right now.  My gut has rewarded me in the past 🙂


I’m working on a ‘Blockchain Week’ post-mortem – it was an amazing experience.  Met a lot of really interesting people at Ethereal, Consensus, and meetups.  Learned some really cool new things.  The ETH / blockchain ecosystem has never been more exciting.

More to come later.


I highly recommend reading this r/ethtrader post from DCinvestor –  Catalysts for ETH Price Increase over the next 6-12 Months.

I think DCinvestor does a great job summarizing the major reasons why ETH is set to explode over the next year.

Ethereal Day 2 Live Blog

Just arrived back at the Knockdown Center in Brooklyn for Day 2 of Ethereal, first speakers getting ready to start.

I’ll be updating this post throughout the day.  The Golem demo is starting soon I’m going to go to that.


Golem demo was really interesting.   The highlight is that their first business case – video rendering services – is faster and cheaper than current centralized systems like Blender.   This is promising for the future of the technology / other potential applications, but there is still a lot left to go.  I need more time to write up everything I learned.

After that I went to a talk by the AdChain team about ‘Token Curated Registries’ – a really interesting concept with a few projects now live on the ethereum main net.

Then AdChain went through a demo of their platform, followed by a talk with Joe Lubin, and afterwards a demo of ‘web 3.0’ by the Toshi product lead at Coinbase.

His presentation showed a version of the Toshi mobile wallet with a few coins, the #2 coin was BAT.  I’ve mentioned this before that I thought BAT would be added to Coinbase – I think the promise looks really good.

Really interesting Q&A.  Somebody asked if they planned for desktop – he didn’t say it was on their roadmap specifically – and he even said he thinks other browsers will solve this ‘gap’ between mobile and desktop.  This makes me believe they are planning on something like Brave Browser (BAT’s browser) potentially accomplishing this.

Overall really bullish.  Next going to a talk called ‘Blockchain as an Artistic Medium’ – overlaps with my idea for a decentralized mapping / photography project.


Lots of stuff happened that I’m recapping in a future post.  I did a few other things during Blockchain Week including a BAT meetup with Brenden Eich and Consensus Day 3.  Thoughts coming on all of that soon.





Cryptos Stumble; ETHEREAL NY 2018 Begins

After breaking $800 late last week, ETH is now trading at $685.  I don’t think this is the beginning of a new downcycle.  With such rapid growth since mid-April it makes sense for some pullbacks along the way.

This latest downward movement was crypto-wide, impacting all major coins.  Bitcoin, which was flirting with $10K, is now sitting at $8650.

Part of this latest “panic” was caused by ~8,000 BTC moving from a Mt. Gox wallet, approximately $70M that might be sold on the market.

Sentiment can change quickly in the space.  We could see an emotional reaction that exacerbates this dip, followed by an equally emotional reaction where the price rises quickly.  For the long-term investor, this is just noise.



Every year the Ethereum Foundation holds a summit where the latest advancements and applications of the ethereum platform are discussed.  Since I live in Manhattan it was a no brainer to attend.  So far it’s been awesome.

The program kicked off with the new Executive Director of the Ethereum Foundation, Aya Miyaguchi.  She was drawn to Ethereum because of the amazing community that’s been built around the platform.  It’s a group of people who want to make the world a better place, something she identifies with.  As do I!

After that I spoke with the CTO of FOAM, a “proof-of-location” application that’s getting close to ICO.  I’m especially excited about this technology as I plan on using it when I build my ‘decentralized mapping project’.

I also got to hang out with Token Foundry employees.  Token Foundry is the Consensys formation that helps new dApp ideas become reality.

It’s a two day conference and I’ll be posting updates.  Paul Vigna from the WSJ just started speaking about this ‘paradigm shift’ in 500-year-old system of record keeping.  This is cool.

ETH Back Above $800; Regulatory Meeting Monday

Coinbase Anticipates 100% Growth Over Next Few Months

Yesterday Coinbase announced that their transaction capacity increased by 1000x last year.  They expect growth to continue with a doubling of transactions over the next few months.  This supports my idea that ETH has a lot more room to run / explode.


Important SEC/CFTC Meeting on 5/7

The SEC and CFTC are meeting on Monday to discuss whether cryptocurrencies like Ethereum should be regulated as securities.  To me it’s clear that ETH is NOT a security and should not be regulated like it.  This is the majority opinion across people in the crypto world – one supported by Ethereum’s core team.  This result of this meeting could very well send ripples through the entire cryptocurrency market.

Joe Lubin, co-creator of Ethereum, has come out publicly against the treatment of Ethereum as a security.  He believes regulators don’t truly understand what Ethereum is and that it shouldn’t be grouped with other types of cryptocurrencies whose purpose is ‘currency.’  Lubin argues that Ether is not a ‘currency’ – it’s the ‘fuel’ required to run the Ethereum platform.


ETH Reapproaches $800; BTC $10,000

Positive price movements continue for both Ether and Bitcoin as ETH continues to lead the way.  This has the makings of a big weekend.

As Bitcoin has slowly re-approached the $10K milestone, Ether continues to spike upwards, briefly breaking $800 earlier this morning.


ETH Rally Continues


Bitcoin Nears $10,000

Over the past 48 hours the ETH/BTC ratio has been pretty interesting, continuing the positive trend for ETH –

This ratio has been really important during this last few months, where ETH fell harder than BTC, and is now recovering faster.  Chart below illustrates that –

ETH/BTC since March

Zooming out on the ETH/BTC chart makes me even more bullish on ETH.  This recovery has been extreme but ETH is still far from it’s previous ATH (all-time-high) on the ETH/BTC ratio.  The chart below is encouraging to me because it shows how much more growth is possible.

At .17 on the ratio we’ll arrive at what is called ‘The Flippening’.  This means that Market Cap of ETH will surpass Bitcoin.  I think this happens later this year.  I think the ratio hits .17 as BTC rallies towards $20K as well.  This would bring ETH to ~$3,400 – right in the range of my end of year price.

Vitalik Launches ‘Sharding’ Proof of Concept

Really big news.  Currently the biggest obstacle to Ethereum adoption is ‘scaling’ the network.  The ETH blockchain – while incredibly promising – is not close to fast enough to handle the potential transaction volume required.

For Ethereum to deliver on it’s promise it needs to be at least 100x faster than it is now.  Ethereum will need ‘Visa-level’ transactions per second to handle all the applications / usage of the network.

To get an idea of where we’re currently, Visa handles 2000 TPS (transactions per second) with a capacity of 20,000+.  Right now, Bitcoin has 7 TPS and Ethereum has ~15 TPS.


The ‘Scalability Trilemma’ – Vitalik Buterin, Creator of Ethereum

Vitalik believes there are three core components of a blockchain – Decentralization, Security, and Scalability – and current blockchains have to make sacrifices and aren’t able to achieve all three.

The biggest problem, however, seems to be scalability.

“Why is scalability so hard? I often talk about the ‘scalability trilemma’, where I say that blockchain systems have to trade off between different properties. And it’s very hard for them to have three things at the same time, where one of them is decentralization. The other is scalability, and the third is security,” Buterin said.

According to him, it’s very easy to have two of these, but developers will end up having to sacrifice one of them to some measure.

“For example, if you want only security and decentralization, then you just go for existing blockchains,” he said.

He then proceeded to list all the blockchains that exist today (including Ethereum and Bitcoin), which were developed with a focus on security and decentralization but suffer when it comes to scalability.

“The other thing you can do is you can go for decentralization and scalability at the cost of safety,” he added.

Buterin’s favored solution appears to be “sharding”, a practice in which only some of the nodes will process transactions from one particular block. 


Sharding Proof-of-Concept Published

On Tuesday Vitalik dropped the ‘proof-of-concept’ code for ‘Sharding’ – his solution to the blockchain scalability problem.  This is massive.

Short-term scaling is required for ‘Dapps’ – decentralized applications – to be launched on Ethereum.  Remember CryptoKitties?  It’s a game based on Ethereum that broke the network.  If one cat game can overload the network, how can multiple applications function together?

There are hundreds of ‘Dapps’ being built right now that are waiting on this faster version of Ethereum.  And it’s coming sooner than later.


Hybrid POW/POS Impact on Ethereum Inflation

Another big thing I’ve been talking about is this move away from ‘POW’ (Proof of Work) to ‘POS’ (Proof of Stake).  This means the “mining” element will be eliminated and replaced with “staking”.  This means instead of computers wasting power doing nothing, Ethereum holders can “stake” their holdings for rewards.

The current “block reward” – how much ETH is given to miners each “block” – is 3 ETH.  When Hybrid POW/POS comes later this year (maybe August?), the reward for miners drops to 0.6 ETH.  That’s a massive reduction!

On top of that 0.6 ETH a small amount will be given to “stakers” – I’m not sure of the exact amount – but overall the inflation rate of Ethereum should drop to ~2% later this year.


Impact on Ethereum’s Price

Over the past few months positive news for Ethereum hasn’t really impacted the price.  I was mentioning this as the price kept going down through March/April – the price movements seemed divorced from the actual news / development of Ethereum.   Nothing was going to stop the big retrace before Tax Day.

Right now the overall crypto market is recovering – and despite the recent positive price movement, I still think ETH is waiting for it’s breakout moment.

Overall Crypto Market Cap

Over the past few weeks the ETH/BTC ratio continues to move as predicted –


As I’m writing this ETH is @ $740 after breaking $700 overnight.  I expect continued positive movements over the next few weeks.  I think ETH is coiling for a crazy move this summer, and I’m not the only one.


Reddit Creator Predicts $15K ETH!?  By 2019?

Alexis Ohanian – Serena William’s husband – or otherwise known as the co-creator of Reddit – threw out an end-of-year prediction of $15,000 ETH.  That’s bullish!

Pretty hard to imagine though.  Or is it?  As I’ve been saying, crypto is still in the 2nd inning.  None of the promises of blockchain have delivered yet.  Decentralized Applications are still mostly theoretical.

But if this really is “the new internet” – a new blockchain based internet layer that runs on the Ethereum blockchain – then that price point is completely reasonable.  By the end of year?  Maybe not.  But just look at last year.

In 2017 the price started at $10.  The “moon” that year was $100.  Would ETH go 10x and reach $100?  The end of year price was $750.

Right now there is so much crap (aka “shitcoins”) in the ecosystem.  Eventually that money will flow into the real “blue-chip” projects – Ethereum and Bitcoin.

The entire crypto market is under .5 Trillion.  Down almost 50% from ATH.  These are early days.

Crypto is not done surprising people.


What’s Next? (WTF Am I Doing With My Life?)

In the midst of all of this I’ve been trying to figure out what I personally want to do.  Now that I’ve quit my job the pressure is on.  I have so many ideas and directions in my head, it’s been a bit overwhelming.

This past weekend I was in Los Angeles, spending time reconnecting with good friends and getting good advice.

I’ve decided what I want to do next.  I want to build something on Ethereum.

This is really what I’m most excited about.  I want to build something that wasn’t possible before on the old internet.  I want to help build the new one.

More on that later, it will be helpful to write it out.

The Future of Ethereum; ETH @ $680

OK, sorry for not posting Mom. It’s been a week… what did I miss?

Ethereum continued it’s rally, passing $700 before falling back into the high $500s earlier this week and continuing it’s climb upwards. Yesterday saw the price increase from the low $600s to the mid $600s, and today the rally is continuing as ETH looks to push back above $700.

All of this is good – in my opinion the retrace earlier this week is a healthy/positive sign that this rally is not over yet.

I think ETH is a definite buy right now. I’m even increasing my end of year projection for ETH. I think it ends the year above $3k.

I’ll explain why in a second.


Retail vs. Institutional Investing

I was recently part of a market research group for a hedge fund that is launching it’s own automated crypto trading intelligence program that works through machine learning.  That’s quite a mouthful.

The founders of the company were hoping to get feedback on their advanced trading tool – unfortunately the panel of people that attended were pretty much non-traders.

They had us fill out sheets that would rank different ‘crypto factors’ that we think impact price. These included technical indicators like “RSI, MACD, Bollinger Bands” – standard technical analysis metrics that traders use for traditional markets – along with other *new* factors like ‘Social Media Sentiment / Momentum’ and ‘Social Influencer Sentiment’ analysis.

Their main point was that this market is currently 90% retail – which is the complete opposite of traditional markets like stocks.

Hedge fund guys want to take advantage of this “highly emotional” retail market while it still exists, before the “smart” institutional money comes in.

The session ended up being really confrontational, with the hedge fund guys talking down to us and basically calling us “retail money” and a bunch of noobs.

OK, so where am I going with this?

In an immature, retail-heavy market like crypto is right now, traditional technical analysis doesn’t really work. This market is driven mostly by emotion and overall crypto sentiment. The social media factors are far more important in crypto than they are in about any other market.

This leads me to this chart from Google Trends –

This intersects well with my old life as an SEO / search guy.  The chart above graphs the general popularity of a term over time.  This chart – to me – is great evidence that a MASSIVE BULL RUN is coming when Ethereum finally does become “mainstream”

The chart below compares the popularity of ‘Ethereum’ vs ‘Bitcoin’

There is a lot of room for ETH to grow.  And when the momentum does come, and the focus is on Ethereum, the price spike will be legendary.

ETH is a buy right now.  Institutional money is about to flood the market.  This is going to create another hype cycle.  The market is so emotional right now (Retail) that as the institutional money (which bought this dip) pushes the price up, the retail noobs are going to kick it into hyper speed.

(Good example is my Mom who only asks if it’s time to buy as the price is shooting up)

All this is setting up for a massive ETH move later this year and into next.

I’ve never been more confident in Ethereum.

Amazon Chooses Ethereum; ETH Back Above $600

A few big things dropped today.

First, Amazon launched blockchain functionality on their servers, letting developers build off the Ethereum blockchain.  This is huge news as Amazon had yet to make any announcements about this.

There was some excitement late last year when Amazon bought a few crypto domains, including, but before today nothing formally linked Amazon with the Ethereum blockchain specifically.


Hybrid PoW/PoS is Coming

This good news coincides with a big development update from the Ethereum Foundation, the non-profit organization that is developing the Ethereum Protocol.

A major milestone on Ethereum’s roadmap is the transition from PoW to PoS.

PoW = Proof of Work – the Original Bitcoin method for securing it’s blockchain.  This is where “mining” comes in.  It’s incredibly inefficient and energy-consuming.

PoS = Proof of Stake – Ethereum’s upcoming method for securing it’s blockchain.  Instead of computers mining, the network is secured by users willing to “stake” their ETH.  With this method the new “ETH” that is being created is being distributed among ETH holders instead of computer mining farms.

Right now Ethereum is running a 100% PoW system with a plan to go 100% PoS.  It’s unclear exactly when this will happen as there are a lot of dynamics at play.  As mining computers get cut out I’d expect to see a “fork” of ETH, but that’s for another day.

Vitalik Buterin suggested a “hybrid PoW/PoS” system to start, with the new ETH being rewarded to both “stakers” and “miners”.  This is seen as a key step on the way to full PoS.

Today an Ethereum Improvement Proposal (EIP) was published by the Ethereum Foundation for this “hybrid” system, EIP 1011.  Now that the proposal is public the community has all the details about the hybrid plan.

Discussion on the proposal is happening in real time with Vitalik answering question on Reddit – Link

I think it’s fascinating to see the discussions happening in full public view with Vitalik responding to both the technical and non-technical users.

As I’m typing this Ethereum just passed $615.  I think this news helps push the price along but it’s all part of a larger movement.  Sentiment has changed.

Lessons In Taxation; ETH Recovery Continues

I’ve learned a lot of lessons since I started experimenting with crypto 2 years ago.  None of them have been more expensive than the tax lesson.

No matter what your politics are we can all agree taxes suck.  Objectively it’s hard to understand how taking such a large percentage of one’s total income is really necessary.

On the news all you hear about is government misspending.  This from a group that ran off fiscal responsibility when it comes to tax dollars.

We have our EPA Director Scott Pruitt’s 20-person 24 hour security team…  making his employees fly Delta so he can rack up bonus miles… from a guy who was going to “gut” the department and massively reduce spending.  The hypocrisy is amazing.

In the big picture I understand that the government needs our tax money to function and I accept that.  But there’s something wrong with this current system.

For me personally, I wish there was something that took into account lifetime earnings – something that would be more compassionate towards new earners who are just starting their lives.  Instead I’m thrown into the deep end (literally) of the tax bracket.

It just feels wrong that I end up paying a higher % of total income to the government than some of the richest people in our country.

But that was last year and what’s done is done.  I’m learning from my mistakes – here’s what I’m doing differently in 2018.

Create LLC or S-Corp

By “investing” and trading cryptocurrencies I was essentially running my own business.  That’s how I’m getting taxed on it, just instead of going through an actual business it’s being taxed as additional personal income.

By creating a company I have a better system for managing my business expenses and can reduce my future tax liability.  I don’t know 100% how this works yet but I’m exploring it over the next few weeks.

Hold Everything For Over 1 Year

I learned the hard way about the difference between short-term and long-term capital gains.  In 2017 almost all of my gains were “short-term”, meaning I held them for less than a year so they were taxed as “personal income” according to my personal income bracket.

If you hold for over a year, federal long-term capital gains kick in which are maxed out at 20%.  For this reason – especially with my overall investment philosophy – I’m not going to touch anything until everything has sat for over a year.  It’s just not worth the extra taxes.

Anyways, I’m going to be fine.  I had enough money set aside to cover my tax liability.  It was just tough to send so much of my USD savings straight to Uncle Sam.  Maybe they can hire 4 public school teachers.  Or better yet – build the wall… /s

(/s is internet slang for sarcasm.  Figured my Mom would ask.)


ETH Recovery Continues

OK.  This is good.  This is very, very good.

Everything is happening pretty much as I expected.  Recovery 2nd/3rd week of April.  Check out this continuation pattern on the ETH/BTC ratio –

This is the opposite of bad.  This is good.

Zooming out now on ETH’s chart –

Oh baby.  This looks like a bottom to me.  Even if ETH gets batted down to mid $400s again.  I’m really confident in this recovery being real.

This is the 2nd inning with all this crypto stuff.  ETH is about to go on a wild ride.  The ERC-20 tokens I recommended are sharply recovering as well.




Anyways – everything is going great.  Tomorrow we could have a crypto wide 20% reduction.  That wouldn’t change anything in my mind.  The overall trajectory is headed upwards.  All-time-high’s for the REAL projects in the space will be broken this year.  This is still the investment opportunity of our lifetimes.

If Uncle Sam loved me in 2017, he’s really going to love me in 2018 and 2019.  I’ll just be paying him a smaller % of my gains.


Good News in ETH Ecosystem

Apologies for not updating earlier this week.  It’s been a little surreal – the realities of tax season combined with my crypto predictions coming true.  I’m back though.  Onwards and upwards.