Currently heading up Wooz.in and Ohdio.FM, and teaches music business at SAE Institute Jakarta
The trend in cryptocurrency trading has spawned a kind of gold rush, but as the name seems to imply, its inner workings are all somewhat cryptic. (Shutterstock/File)
I was always interested in Bitcoin, not that I really understand the technology, but first impressions were appealing: a decentralized currency, mined by solving mathematical equations and potentially accessible to anyone.
My interest was piqued, but back then, any online discussions about Bitcoin were about the mining rigs. Apparently, it took special graphics cards to be able to mine the stuff, and since I wasn’t particularly into hardware (and oh, I also had no money), I left it in the back of my mind. It never occurred to me that I could just buy some Bitcoin or trade it. That was 2011.
Fast forward to 2017. Discussions on cryptocurrencies had entered the public consciousness, Bitcoin prices were sky high – thereby crashing any interest I had in getting some – and alternative cryptocurrencies like Ethereum were also becoming common knowledge.
A few friends introduced me to a local site on cryptocurrency trading – the most suitable term for the entire affair, actually – bitcoin.co.id. One friend bragged about owning zero-point-something BTC (the ticker symbol for bitcoin), which was at the time equivalent to tens of millions of rupiah.
Another thing that hadn't occurred to me was that I could by a portion of BTC, and that I could buy other types of cryptocurrencies at the bitcoin.co.id exchange.
Taking the leap, I took some money out of my measly savings and bought myself some Bitcoin. The date was Oct. 12, 2017, when one BTC cost around Rp 64 million (US$4,480).
In three days, I had made 6 percent. I was hooked.
Then, as with all markets, the price dropped. I panicked. I moved the BTC into other cryptocurrencies. Some rose, some fell, and because of inexperience and not taking the time to study market forces, I lost 70 percent of my money by mid-November.
It didn’t help that I didn’t take time to research each of the cryptos, and even if I had, there was hardly any basic information around like there were on trading stocks or foreign currency (as if I would have understood it anyway). A discussion with a banker friend led to even more questions, as she questioned the entire cryptocurrency trading industry.
In the meantime, by mid-November the price of one BTC had reached Rp 90 million. Something was definitely happening.
Then I joined a chat group. Some friends and industry acquaintances had created a chat group for discussing potential gains and losses from this or that “coin” (the shorthand for cryptocurrencies), and observing how news on Stellar Lumens or Ripple announcing partnerships with banks or other established companies drove up the price. Finally, by December I had recouped my losses, topped up my investment, made returns on that as well, and finally, finally started making money on crypto trading.
I am now comfortable enough to diversify part of my savings into crypto, as the long-term gains -- at least so far -- are way better than putting money in the bank. Anything that can give me 1 percent gain per month is definitely better than a bank account, and I’ve made more than that.
That said, I’ve noticed that the whole cryptocurrency trading trend is like placing bets on a never-ending horse race, where new horses are introduced to the race almost daily. And don’t get me started on initial coin offerings (ICOs), which, in principle, are similar to a company raising funds from a stock offering, but are instead done through selling “coins” that have certain functions in return for BTC or ETH (Ethereum).
Currently hot on the horizon is Tokenomy.com, which launched an ICO to build an easy-to-use ICO platform. Interested parties had to make a minimum 0.5 BTC investment, and as I write this article, one BTC is Rp 245 million.
Cryptocurrencies are definitely something to watch. The underlying technology, the blockchain, definitely has some interesting potential applications, and the cryptocurrency concept will at some point find mass adoption, as it serves to disrupt (or improve) the banking industry. Governments fear it, some through ignorance, some due to a fear of “loss of sovereignty”. Who really understands it? Not many, I dare say, not even me.
But as long as there is a trade to be made, the crypto rush will continue, and for once, I have a hobby that actually makes money – or loses money. It depends on the day. (kes)
Ario has been working in digital-related industries since 2003, in music, movies, TV, and now startups. Currently heading up Wooz.in and Ohdio.FM, and teaches music business at SAE Institute Jakarta.
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