Hard labor, by Sam Smith

This is a tough book to read, each page is difficult to digest, and every single story is hard to read.

When I read Red and me, I found some hard stories about the racism, the challenges the players were having to dedicate their lives to this sport, etc, etc. Hard labor explains how this happens across the whole country without exception.

Hard Labor: The Battle That Birthed The Billion-Dollar NBA

The whole book goes around the Oscar Robertson’s lawsuit against the NBA that finally made possible the free agency for the NBA players.

The first days of the free agency were not good days, and the players involved in this mechanism were always in trouble.

The suit took 6 years (1970 – 1976) and it blocked the ABA – NBA merge. So you can imagine how Oscar and the other 13 players pushing the NBA as an adversary, so they treated accordingly; not easy days for these players that were spending their savings on attorneys.

The book also covers so many inside stories about the game,

and this is something that makes the book warming about the stories, the personalities of the players, and how the things happened during those days.

The impact of ICOs on cryptos’ value

I have had some conversations related to this during the last months.

The topic

So many companies/start-ups are opening ICO processes to fund their blockchain business. They create a business plan with a budget to fund it, the currency is in dollars/euros or other FIAT currency.

The majority enable the investors to fund the project with crypto-currency, mainly bitcoins or ethers. (It would be ironic that a company based on the block-chain will not trust the 2 main block-chain coins, right?).

The point is that the money they have raised is to fund the project that is based on real cost needs: salaries, equipment, other services. The majority of the services are paid in FIAT, so you are obliged to sell these coins in the market and then use the money for your business plan.

The questions I ask my self are

  • How many of these “sells” are provoking the market to bear?
  • Is there a real impact on the market?

Let’s do some math

I have used the data from https://www.coindesk.com/ico-tracker/ to do some basic math of the situation, and this is the result.

Let’s assume:

  • Take only in consideration the number of ICOs from 2018, as the ones for 2017 are already cashed in FIAT.
  • that the companies only enable to fund with Bitcoin and Etherium (data taken from https://coinmarketcap.com/ on August/2018).
  • Let’s assume 2 scenarios:
    • Scenario 1: 30% of the collected money is done in crypto-currency.
    • Scenario 2: 70% of the collected money is done in crypto-currency.

The math would be:

The result

Ok, the analysis is very simplified, and there could be a lot of bias on it.

But at rough estimate it looks like the impact is very low even if a high percentage of the collected funds comes from crypto-currencies.

On the other hand it’s a good bunch of dollars, isn’t it?

Crypto-currencies are more stable than some fiat currencies

Since I look into trading on crypto-currencies, I use to invest sometime reading news about them, trying to understand the real use, the real applications that are solving real problems with these virtual coins.

The predominant comment you find when you talk to anybody is:

Bitcoin is very unpredictable and the value fluctuates a lot, it’s too risky.

So well, you read and read, and then you find so many users from countries as Venezuela and Argentina, that moved their money into some of the crypto-currencies. For them this is not a risk, is an opportunity to save their savings.

Why?

The graph below shows the BTC/USD (blue line) in comparison with BTC/USD.

You can clearly can see how unstable is Bolivar in comparison to BTC, both compared with the USD.

I live in a country that is stable, economically, politically and socially. But there are other people that are not as fortunate as me. And for them, doing the simple math demonstrate that crypto currency is more stable than their own local currency.

Why they do not change to dollars?

In so many countries for the tourists they offer hotels, adventure activities, flights… with a different price every single day. The business person, the first thing they do in the morning is to consult the USD value in comparison to the local currency and then s/he defines the prices for the day.

You can pay with local currency or in dollars, but they ensure some grade of parity.

It works like this and the fact is that the continuous flow of foreign currencies and many other things that work makes the things stable. I have seen this in different countries as Thailand, Costa Rica or Vietnam.

My point is that in countries that are not as stable as the ones mentioned above, the lack of foreign currency makes the companies and the people to run behind the USD, making the supply/demand balance very unbalanced.

So, for some of these people who are able to trade to crypto-currencies, they do it, it’s not risky, it’s an opportunity.

Quantitative trading on cryptocurrency market Q4

This is the third chapter of a learning process that started last September.

Fourth Quarter

The fourth step is defined for the next 3 months, where the main goal is to retake the back-testing and work more adjusted to a given analysis. I will also continue trading manually so I continue learning on the market momentum.

Following the V2MOM model:

  • Vision: Have a strategy running in crypto currency market running not with a period of 2 – 3 hours, but some days (stop operating at 3m).
  • Values: have fun, learn a lot, build a team with Dani, do practices and more practices.
  • Method: learn about trading basis, do backtesting with Quantopian on stocks or Forex (analyze the results in deep).
  • Obstacles: Time.
  • Measures:
    • Make short/long decisions based on 3 hour.
    • Perform backtesting with Tradingview and document the results and findings.
    • Improve and document the “mode operations” and “mode backtesting”.

Death line = September 2018

Results (October 1st, 2018)

  • Time to be accountable, let’s go…