maybe it is me, but i can't see how you place value into a coin that has no market value... if you are exchanging it for your tokens (that would supposedly have a market value and ICO investors behind it), and then burning the tokens, you'll be loosing value on your own tokens because the assets behind that coin have already failed ...
the problem is that the market is always the boss and if a project failed, and this can be due to many reasons, and lost the market, i can't honnestly see how you can make profit from this
This is an interesting issue. Did the project really fail because it had bad assets, or did it fail due to other reasons? Assets by themselves, when we are speaking about code, might be faulty. This doesn't mean they can't be debugged and used on other projects. That makes them valuable assets.
On the other hand, there are many more hidden assets within these coins, which will remain relevant even after we burn the dead coins we acquire:
1. The users. Integrating users from hundreds of failed coins under a single umbrella (CoinJanitor) creates network effect. That is extremely valuable! They will be integrated through custom token-for-dead-coin swaps. Burning the dead coins we will receive after we provide onboarding doesn't affect the value of that network effect at all.
2. Transaction data and meta data within each of those blockchains. Data is a great asset, and when we get to analyze hundreds of blockchains, we will find behavioral patterns that we will be able to use. That is a huge asset. It is the raw material we need to produce more advanced tools, and it will remain even if we burn those dead coins.
The final part of the issue you raised has to do with the invisible hand of the market. Yes, the market is king. These projects have been relegated to oblivion. The market does that everywhere, and then it also gives people the opportunity to re-purpose those assets that were relegated to oblivion: scrap metal is a good business in many places around the world; at the height of the 2008-09 economic melt down, gold went above $1,700 USD an ounce and businesses were collecting old electronics to extract the gold from them because it was a viable business. We see that kind of value in dead coins. The price of these coins is almost $0 per coin, but their value as a raw material, as an asset that can be re-purposed or as "waste" that can be recycled, can be order of magnitudes greater than what the price reflects.
well, first of all, thank you for this interesting explanation!
I agree with some of your points, especially if the coins to be "recycled" are chosen very carefully... sometimes the failure can be due to something simple and easy like marketing faults and nothing to do with the core project...
nevertheless there are somethings that are not so easy, for example concerning the network effect, how many people still hold the dead coin? if it was a coin that had an exchange outlet, most of the holders probably already got rid of it...
will the developers still be reachable? most of them are anonymous and long gone...
how will you burn the coins? (maybe this is a dumb question) will you only target ethereum tokens? CoinJanitor will be an ERC20 token?
sorry for so many questions, but i find this a very interesting project to discuss
hello,
really interested in your comments concerning my last questions above... this is an interesting project and i'm keen to learn more about it...
thanks
1. For people to dump the coin, others must have bought it. Dumping on exchanges might work the other way around actually. It is difficult to coordinate a mass dumping, so there is likely to be one or a few big holders who dump at once and get prices to crash when everyone else follows. Someone is always left holding bags, most likely people who took a risk they didn't calculate properly. Even then, with more than 3,000 coins that are no longer traded on exchanges, if there are a few hundred coin holders per coin buy-out, and we multiply that by hundreds, then we have a good network to foster. There might be holders that have several different dead coins, which might mean we would be buying out the same holder twice or three times on different dead coin buy outs, but we expect that to be the exception and not the rule.
2. One of our search parameters deals with how reachable developers and community members are. We will be targeting those that we can reach. After a few buy outs, when the word spreads, we might see people knocking on our doors instead of us having to reach out.
Even if those devs are anonymous, they still have email addresses they set up for those projects, or they act under pseudonyms on places like Bitcoin Talk or social media. We will reach out directly (email, other contact details) and indirectly (using our own social media channels, website and community members), and verify that they are the actual owners of the project.
3. Burning the coins basically involves sending them to an address that no one will ever have access to again. After that, we want to make sure no one else can transact on those blockchains again either.
4. We are initially targeting the older coins, which are mostly PoW and have chains of their own (as opposed to the ERC20 tokens that are mostly piggy backing on the Ethereum network). We want to focus on these coins for various reasons, but mainly because: a) Some of the earliest adopters of the tech might still hold them, which gives our community value. b) Those coins had enough time to prove they could do something but failed; it would be difficult to argue that they are not dead.
5. CoinJanitor will be an ERC20.
Keep on asking! We love to engage and answer all the questions that we get. Like you see, we are pretty passionate about cleaning up the space, and answering your questions is a critical part of the exercise.
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Topic: [ANN] CoinJanitor [ICO] Do dead coins go to heaven? Or do they go to the Janitor (Read 15998 times)