Aug 16, 2021
In this newsletter, we are profiling LBRY Credits [LBC]. In previous newsletters, we have profiled Bitcoin, Cardano, Stablecoins, Uniswap and many others. Access all our newsletters in our archives at madcapx.substack.com.
The Short of It
It is hard to take down giants such as YouTube? LBRY Credits is taking a stab at competing but is the government going to take away that opportunity with a lawsuit?
LBRY Credits was founded in 2016 and launched in 2018 by Jeremy Kaufman with the goal of simplifying how digital content with a decentralized model is distributed and accessed by both the producers and the consumers. The platform makes it easy for content producers to charge a fee for consumers if desired while avoiding a middleman and censorship. The token used in their ecosystem is LBC, and you can manage and view videos/audio/posts at odysee.com.
For the first couple of decades, they plan to keep the circulating LBC supply at around one billion. The entity behind it all, LBRY Incorporated, has promised distribution of the tokens as follows:
- 10% for team members and operating expenses
- 10% for partner organizations and charity firms
- 20% for awareness programs to drive adoption
- 60% for community rewards
The network is secured via a distributed hash table data structure and Proof-of-Work blockchain that is very similar to the one used in Bitcoin. It can handle around 30 transactions per second, but as the main focus is decentralized file sharing, this is not so important.
While any content can be stored on the LBRY blockchain, the sites that are used to view the content can still be censored. Odysee will follow all DCMA takedown notices and remove flagged offensive or illegal content from its index. This does not mean the content is taken off the blockchain, but only the reference to it from their site. Content producers that store LBC on the site can also lose it if they get penalized for inappropriate content.
Like with websites that all start with http://, content on the LBRY networks starts with lbry://. Each file gets assigned a permanent and unique ID in the form of lbry://<name>:<ClaimID>. Content owners can then hold any amount of LBC toward gaining control of a short identifier (of the form lbry://<name>) that corresponds to their permanent identifier. For example, if a user had lbry://cryptocurrency.1337 and put up 100 LBC to get lbry://cryptocurrency; somebody else could put up 1000 LBC to make that pull up their content instead. This would require the original user to put up more than 1000 to regain control of the shorter non-ID version.
Not only can content producers make a profit on the platform. Users get rewarded with LBC for consuming content. LBC can also be used for giving tips and for dissuading bad actors from controlling keywords by voting against them.
Obviously, the biggest competitor in this space is Youtube, which is not crypto-related. It is yet to be seen whether enough people care to start adopting decentralized platforms. You may be familiar with Steem and SteemIt, which attempted to overtake WordPress as a decentralized blogging platform. While SteemIt was fairly successful in the beginning, its usage and growth have significantly diminished. Other decentralized video platforms also exist, like Theta, which we previously profiled.
The LBRY protocol can store any type of file, not just video. While video, audio and blog posts are currently the main use case for Odysee, we can assume we will see other file types added in the future. If you see the potential here, this may be a good time to make an addition to your portfolio.
On this chart going back to 2017 with LBC/BTC, we see that hodlers did not fare well by losing 99.9% against Bitcoin. LBRY Credits have had its share of issues with keeping the value of its token being a big one. In 2017 it peaked at 38208 Satoshi and hit a low in June 2021 of 31 Satoshi.
When we zoom into the last 2 years, we can see a sideways trendline move with a range of over 700%. During the last peek, the SEC filed a lawsuit in late March 2021. Since then, we’ve seen LBC reach all-time lows. Will the lawsuit keep the value suppressed for an extended time? Are the all-time lows in? LBC is #667 on CoinMarketCap, one of the lower market cap assets we have profiled. Without the SEC lording over them, there could be plenty of potential upside.
The Other Trend Lines
50 years ago, the U.S. went off the gold standard.
The Nixon shock was a series of economic measures undertaken by United States President Richard Nixon in 1971, in response to increasing inflation, the most significant of which were wage and price freezes, surcharges on imports, and the unilateral cancellation of the direct international convertibility of the United States dollar to gold. — wikipedia
Since August 15, 1971, we can see some of the ramifications that happened afterwards.
This portfolio section gives you an idea of what sort of return you can get when investing in crypto assets.
BTC/USD FUND is up 325% since October 1st, 2020. Since this is a long-term holding, it is best kept in cold wallet storage or a safe custody solution. We continue to see a long-term hold position as our best stable alternative. This past week bitcoin has been ranging between $43,770 and $48,144 USD in value.
FUND 3 started on November 16, 2020, with $1000 USD in value and was invested into BTC, LTC, ETH, and ADA. The total amount of BTC value from the four coins has had a gain of 134% since the start. The USD fund value is up 545% since the start. We will hold these positions to see how well it does against our BTC-only portfolio. LTC is down -9% against BTC. ETH is up 149% against BTC since the start. ADA has a gain of 632% against BTC and 1902% to USD.
BLWX Fund started on February 22, 2021. They all are assets we have profiled in the last few months, and we are interested in how they will perform in 2021 against BTC. BAT has a gain of 68% against BTC since the start; LINK is up 8%, WAVES is up 148%, XMR is up 37%. Overall, against BTC, the fund is up 65% and 39% against USD.
Overall, Bitcoin should be your first choice as an investment in crypto, though many digital assets can give you amazing gains if you manage your risk. As a long-term investor, we see it as our largest portfolio investment. If you are a day trader, there are many great assets to put on your watch list. Look through our previous newsletters to find some.
MadCapX research newsletter is written by the Madbyte Team. You can learn more about Madbyte and MadCapX on our websites.
Madbyte does have its own token called MADX on the Ethereum network and Madbyte on the Waves network. The two tokens are interchangeable on Madcapx.com.
Disclaimer: Nothing in this newsletter is intended to serve as financial advice. Therefore, do your own research and due diligence before applying any of the techniques highlighted in this post. Any risks or trades based on this newsletter are committed at your own risk.