What’s up guys.
We gotta talk about the MCO CRO Swap that
they just announced today. The economics are
very complicated so I spent many hours researching
the topic to try to understand the situation
but I cannot imagine all the strategies that
Crypto.com has in mind. It’s possible I'm
wrong. I don't give advice, question everything.
Crypto.com decided to stop their MCO coin
and a lot of people are very upset about this.
You can read the comments on twitter. The
debit cards are also 4 times more expensive
at the current value but that could increase
or decrease in the future. They had to allow
people to exchange the MCO coins so they offered
a free swap. Without the swap the value of
MCO would have gone to zero in seconds and
that would have created too much madness and
lawsuits. Is 33 CRO per MCO fair? Some people
think it's not. If you accept the swap you
cannot sue them. Some people are selling their
CRO coins because they lost trust. It's not
clear if you can keep the advantages for your
cards with the same amount of MCO converted
to CRO at the end of your 6 months stake.
I guess not.
The CEO will answer questions tomorrow in
a live stream. People should wonder why they
decided to discontinue the MCO coin. Many
people have been talking about that possibility
for a while on Reddit. Some people said that
Crypto.com was getting to the end of their
supply of free MCO coin reserve that they
sell to finance their company.
They are not the only company doing that.
It's common practice for crypto companies
to create funds out of thin air by creating
a coin that nobody needs and then create the
need for this coin to sell it for a huge profit.
Once they get to the end of their supply of
free coins they can just make a new coin out
of thin air and create a need for it once
again. Then they can get free money from selling
the new coin once again. They can repeat this
as many times as they want.
In this case Crypto.com can use the CRO coin
they created for free to buy back the MCO
coins. The market cap of CRO is 36 times bigger
than MCO. 3 billions vs. 86 millions dollars.
They currently have a huge reserve of free
CRO they can sell to control the price of
the coin and the services they offer with
staking. Maybe I’m wrong. Maybe they want
the price of CRO to go up and they will reduce
the number of CRO you need to get the debit
cards. No one knows. They control the system.
You can check their website. At the bottom
of the cards comparison. It’s written that
they can modify their offer at any time. Once
I saw that I understood that they can change
the rules of their game at any time to keep
winning. That’s basically how most games
work when they are controlled. The world economy
and currencies are part of it.
But now that they are stopping their MCO coin.
Does it mean Crypto.com is a scam? Again it
depends the point of view you pick. It can
be a scam as much as the US dollar can be
a scam. This whole society could be a scam
too.
Did Crypto.com lied? I don't know because
I don't know everything they said for 3 years.
You can write your opinion in the comments.
Maybe they didn’t lie but they should have
insisted that they could change the rules
anytime, I saw earlier and old video of the
CEO saying there will never be a swap from
MCO to CRO. Companies can change their mind
but they can also keep in mind people's investments
and trust.
Is crypto.com a Ponzi scheme? To me it does
not look like it. Yes they offered amazing
deals at a very cheap price when the MCO coins
were at 4$ but they didn’t finance everything
with new costumers like a Ponzi scheme. It
was with the money from their coins. Even
if they don’t make profits at the beginning
it’s normal for new companies to do that.
Does crypto.com manipulate the price of their
coins? I think it's likely. It makes sense.
Some people on Reddit talk about it. Does
that make them a scam? It could be depending
the point of view you take. They definitely
lack transparency about that but they explain
some stuff in small print like all lawful
companies. Adults are supposed to do their
own research.
It's funny when you see companies saying that
they offer a bonus on some coins because it
directly influence the price on the free market
which makes the bonus meaningless. MCO could
have been swapped for 33 CRO directly instead
of talking about a bonus. It's the same when
they say they offer crypto currencies at up
to 50% discount when no one ever gets that.
Many people have difficulties with math and
companies noticed. It's funny to see people
on twitter praising MCO pumping when it's
clearly not.
Is crypto.com audited? Yes they have been
very well audited so that also makes it much
less likely that they are a Ponzi scheme.
They also have serious employees with serious
backgrounds. Usually it's impossible for Ponzi
schemes to get audited because they would
get caught directly.
As always there are red flags when the deal
is too good to be true. The only way for legit
and audited companies to be competitive with
them is to follow similar tactics and that's
what they do. If you know better tactics from
other companies. Let me know in the comments.
One red flag was that there are only 31 million
of MCO so if everyone stakes 50 MCO for the
basic card it's only possible to get 630 thousands
MCO debit cards before all the supply is staked.
Another question is: Are all the youtubers
who promoted crypto.com services part of promoting
a scam?
Well to that question, I don’t want to take
sides. I believe that many youtubers are smart
and definitely saw just like me and people
on Reddit that Crypto.com could change the
rules about their coins and it could have
been to the advantage or the disadvantage
of the users. Everyone has to manage his risk.
No one knew what they would decide in the
future. Crypto.com probably spent a lot of
time thinking about what they would do. Weighing
the company's interest and the customer’s
interest. I understand that some youtubers
did not believe that crypto.com could screw
over their customers. We have to wait to see
the outcome.
I saw on Reddit people talking about putting
thousands of dollars of personal saving in
MCO and CRO because they trusted Crypto.com
and saw it as a stable long term investment.
Many youtubers keep warning that cryptocurrencies
are always risky. I also understand that youtubers
are normal people and it's extremely tricky
to know what to promote or not. Crypto.com
is a legit and audited company following the
law. They do not do anything illegal. Also
almost all the youtubers already promoted
them so I understand that it would be weird
refusing money promoting Crypto.com while
the biggest and smartest youtubers are promoting
them. Making YouTube videos take also a lot
of work and getting paid helps youtubers improving
their videos and give back to the community.
I also believe in determinism and I try to
understand why people behave a certain way,
right or wrong. Everybody makes mistakes.
I understand the people who are mad at youtubers
who advertised Crypto.com even more if they
lose a lot of money. It's too early to know
if people will lose money.
Even if people don't like staking their coins
Crypto.com offers a free debit card with 1%
cash back that might still be a good deal
for many people.
Did I get a MCO debit card? Yes I did. Just
one week ago before knowing about the swap.
I also tweeted my concerns 6 days ago that
crypto.com could stop their MCO coin. I decided
to get the card because it seemed to be a
good gamble for my personal use and the ruby
card only cost 200$ for 50 MCO and I got 50$
signing up bonus so in the end it was 150$.
I knew there was a risk to get screwed over
but I was ready to play and lose. I had in
mind that at the end of my stake the MCO/CRO
would be worth the same or much more or much
less. It’s risk management.
Some people are switching from crypto.com
coin to swipe coin because they feel betrayed
but to me it looks like they are the same
business model? Let me know in the comments.
As usual many people were deep believers in
the company Crypto.com and defended them whatever
people would say. They still have a lot of
people supporting them and their swap. That's
also one of the reason why there are incentives
not to criticize. Some youtubers get harassed
or sued for criticizing bad behaviors from
people and companies. And when they are finally
proven right no one comes thanking them. Hopefully
I will not get too much hate. Comment, like
and subscribe and see you in the next one.
I'm gonna keep making videos about cryptocurrencies,
my PTSD, meditation and whatever I find interesting.
Peace, Love and Crypto
