Is Waves a Good Investment?

Serious questions about the Waves (WAVES) cryptocurrency are being raised by the actions of a big participant in its platform. The flying car consortium Blockchain.aero has decided to create an Ethereum or ERC20 version of its McFly utility token.

Blockchain.aero; which launched a WAVES token in July 2017, is planning to release an Ethereum token in April 2018. Reasons for the change were not mentioned at Blockchain.aero’s website, but the action raises serious doubts about the Russian Waves.

The Waves platform is intended as Russia’s answer to Ethereum. Like Ethereum, it enables users to build decentralized applications (Dapps) and tokens. Waves is supposed to be as good as Ethereum, yet Blockchain.aero is now adding ERC20 tokens.

Blockchain.aero’s Actions Raising Doubts about Waves

Blockchain.aero is a serious effort to develop an encrypted operating system for autonomous aerial vehicles (AAVs). The McFly token appeared on it last year and became one of the most popular issues there.

Now, Blockchain.aero is adding an Ethereum token to its mix, in what might be a game changer. No explanation is given for the action, but an obvious reason would be suspicion of Waves which is based in Moscow.

The suspicion is that Waves might have something to do with the Russian government and Vladimir Putin. That is not very good advertising when headlines about Russian hacking and Ukraine are filling the media.

Such fears might make people in Eastern Europe, former Soviet Republics like Georgia and Estonia, and the United States leery of McFly and Waves. Many people remember the Cold War; which contrary to Leftist mythology Soviet tyrant Joseph Stalin started.

Others recall the many crimes against humanity committed by the Communists. The political system we call Communism was invented by a Russian;  Vladimir Lenin, not Karl Marx as some people think. Marx was the creator of the dogma upon which Communism is supposedly based.

Even if we forget Communism, people like the Poles have long-standing grievances against the Russian Empire. Unlike ignorant Americans, such people understand what all the Czarist imagery Putin loves to surround himself with means.

Is WAVES value affected by politics

Given the political climate, it is easy to see why even a Russian company like Blockchain.aero might want to distance itself from Waves. Investors will wonder if such fears will hurt the value of the WAVES cryptocurrency.

So far that has not happened, WAVES had a Coin Price of $5.96 and a Market Capitalization of $596.04 million on 9 February 2018, Coin Market Cap data indicates Those numbers were accompanied by a Market Volume of $24.756 million.

That makes WAVES a good investment in cryptocurrency. It might also be a value investment because the Waves platform is a pretty good piece of technology that is being damaged by guilt by association. Value investors will note, Vladimir Putin will not be around forever, sooner or later he will be gone, and Waves will still be a good platform.

How Politics can Affect Cryptocurrency Values

The recent developments in Waves and Blockchain.areo give some indications of future trends cryptocurrency investors should be watching.

The first is that political associations can hurt cryptocurrencies. Another cryptocurrency located in a country with a controversial government; China’s NEO (NEO), might have similar problems.

Like Waves, NEO is an Ethereum-copycat that has been hit with speculation it is associated with an unpopular government. Many observers have voiced the unfounded but logical assumption that NEO has something to do with the People’s Republic of China or the Chinese Communist Party.

As with the fears about WAVES, there is no hard evidence to back such allegations but they are natural. Critics will note that an organization like NEO would not be able to operate in China without government sanction. Likewise, WAVES would not be able to operate in Moscow without Kremlin approval.

Should Politics Affect Cryptocurrency Investment?

Smart investors will note that imagined political affiliations will not affect the quality or usefulness of a platform or technology. Despite that many people seem to prefer Ethereum; which was founded by a Canadian and is currently based in neutral, peaceful, democratic, and staunchly capitalist Switzerland.

This might why Ethereum (ETH) had a coin price of $860.93, a market capitalization of $83.953 billion, and a market volume of $2.430 billion on 9 February 2018. That was far larger than WAVES’ Coin Price of $5.96 and a Market Capitalization of $596.04 million and Market Volume of $24.756 million on the same day.

Expect to see such political concerns affect and potentially hobble a number of cryptocurrencies. Likely targets of suspicion in the future include Litecoin (LTC) which was created by an American and Bitcoin (BTC) with its murky origins.

All it would take is a few rumors about an association between Bitcoin or Litecoin and a US government agency like the CIA for many people to start dumping those currencies. Something to keep in mind is that such rumors would just have to go viral to hurt those coins. Even rumors that were rapidly debunked would affect Coin Prices.

Are we entering the Age of Multiple Tokens?

Blockchain.aero is setting an interesting precedent by issuing tokens on more than one platform. Expect to see that action repeated by many different companies.

A big reason why companies will take the multiple-currency route is to mitigate risk, by diversifying tokens. The belief might be that having several tokens provides more protection from volatility in the cryptocurrency market.

Another rationale for Blockchain.aero’s plans is that Ethereum is becoming the gold standard of blockchain operating systems. For better or worse, most companies are issuing Ethereum tokens. Blockchain.aero might simply want to conform to industry standards.

One reason for this is that many large corporations including IBM, JPMorgan Chase (NYSE: JPM), and Banco Santander (NYSE: SAN) are experimenting with Ethereum. Many of those organizations are participating in the Ethereum Enterprise Alliance and the Hyperleder Project, two efforts to create commercial uses for Ethereum.

Nor is Blockchain.aero alone, American Express (NYSE: AXP), which is participating in the Hyperledger Project is an experiment with some Ripple solutions. Banco Santander which is participating in the Ethereum Enterprise Alliance is also experimenting with a Ripple app and money transfers.

Expect to see many companies experimenting with or using a variety of cryptocurrencies in the years ahead. That means diversification will be the name of the game for cryptocurrency users and investors.