This week the news that Facebook has revealed a plan to cut back on the cryptocurrency advertisement ban has made its way to front pages all over the web. Cointelegraph opens the story stating Facebook’s policy “Starting June 26, we’ll […] allow ads that promote cryptocurrency and related content from pre-approved advertisers. But we’ll continue to prohibit ads that promote binary options and initial coin offerings.”
Well, it looks like there is nothing else to see here, the cryptocurrency community took things rationally….the cryptocurrency community never takes things rationally. Many news stories took this news and signaled a possible buyout in which Facebook might be interested in buying Coinbase.
Bitcoinist broke the story speculating that Facebook could possibly purchase Coinbase merely on the fact that Facebook has decided to rethink its cryptocurrency ban policy.
This news doesn’t necessarily mean that people will buy coins that are speculated to be on Coinbase, but it does create a hype in the cryptocurrency market as a whole and hype up the coins that are already listed. The dream is that if Facebook bought Coinbase they would be able to implement it in their cluster of applications and expand the user base even more. Thus creating a ton of demand for the coins that are already on the platform that would likely stay in a Facebook buyout.
Even if Facebook does eventually buy Coinbase, no one actually knows the date and it is purely a random guess and should not be acted on. Many users in cryptocurrency have seen this news, and some might have even purchased tokens/coins that are speculated to be added to Coinbase.
Sadly this is not the first time news has been altered to speculate an upcoming announcement.
A few weeks ago Coinbase had announced that they would be supporting Ethereum Classic next. Users took to twitter upset as it was extremely unexpected that Coinbase would add Ethereum Classic which currently ranks at #16 according to coinmarketcap.
Many people were expecting a top 5 cryptocurrency coin to be added like XRP, TRX or even EOS. Considering these coins have a bigger market cap and likely have a bigger group willing to purchase them, it makes sense from a bystander that Coinbase would add it to make more profit.
However, since they didn’t and blindsided people with Ethereum Classic it shows that anything can really happen and it is not a good idea to buy something simply because a random person on Reddit is saying that it will be added.
Weeks before the announcement many different postings on Reddit, and Bitcointalk seemed to think they knew what coin/token would be added next on Coinbase. So many users commented stating that they would be buying more tokens/coins in order to cash in on this announcement. Even sites like Cryptodaily have tried to predict which coin will be added next, but the fact is, no one really knows.
Unless privileged information is leaked, it is anyone’s guess as to what will be added. When coins/tokens are hyped up to be announced or added to an exchange and then are not, the people who have invested purely on speculation normally don’t have enough time to get out before the dump as it happens quickly.
So investments are dangerously violent when based purely on speculation of an announcement and not on the actual utility/technology. Coins/tokens should not be purchased merely on speculation an exchange or platform will support them. Investments should be made based on the actual utilization and features. In times of bear markets, people make the craziest investments to try and hit it big.
Settling down, and making intelligent evaluations will be key to the success of any cryptocurrency portfolio.
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