Sun. May 26th, 2019

Cryptocurrency: An Investigation to Understand the Boundaries of Product and Service Marketing

Learning Objectives

● To investigate how products and services are marketed in the world of cryptocurrency.

● How to identify what is genuine product / service marketing against misleading or overhyped material.

● To learn how to form your own boundaries on what is acceptable information to digest, in opposition to discarding inaccuracies.

Introduction

The world of cryptocurrency is a treacherous environment for someone to enter without understanding many of the unwritten “dos / dont’s”. Products are often not developed, services are often overhyped, and people tend to follow the perception of the wider audience without doing their own due diligence.

It does not help the image of the industry that many of the people and organisations that are considered “gurus” or “influencers”, are in fact the ones that project the most severe and damaging inaccurate information.

If you can successfully invest or trade in a volatile market like cryptocurrency, then the rewards can be fruitful. Conversely, if you absorb and follow erroneous information the financial and emotional damage could be very lasting.

So how do you form your own boundaries on separating valuable from misrepresenting information? Let’s find out!

Main Body

A key driver for many successful businesses, organisations and individuals has been on marketing their product, getting their message out there on how they will perform better than the competition. This is a perfectly acceptable, and moreover healthy, in driving performance and growth in markets.

From the perspective of a Provider — The most effective marketing strategies are those that are targeted towards a specific audience. They focus on key benefits based on the audience’s point of view and interests, and delivered at an appropriate time, such as when an audience is likely to be most receptive.

From the perspective of a Customer — The introduction of a new product or service will be easily understandable, educational and offer value. Customers can become confident in brands or services that deliver high quality. This in turn enhances the reputation of the provider.

Applying this to the world of cryptocurrency can be very confusing. Although legitimate businesses must market their products and services, many unjust entities are also using the terms “marketing” and “promo” as a way to subvertly pursue their shady intentions.

We will review the marketing of products and services in cryptocurrency, as well as displaying and reviewing examples of value information from misleading fabrications.

Marketing of Products & Services in Cryptocurrency

What Should Provide Investor Confidence

Products marketed in the cryptocurrency industry may include exchanges, coins, ICOs, online storage wallets or hardware. The marketing of services in cryptocurrency may include paid groups, educational course material, private tuition classes or portfolio management tuition.

If you are going to make an investment into any element of a cryptocurrency related product or service, it is essential to know exactly where your money is going. Solid projects will make sure that they are communicating effectively with the community and have effective measures in place in ensure that they are being open and transparent on developments that are happening.

Legitimate projects should have a whitepaper, a plan and a roadmap of their aims. They will often put out written guides or educational videos to answer fundamental questions. If the project objectives are confused and cannot be readily identified, this brings uncertainty. In addition, the project should look to strengthen wider community relations through employing a community management team to respond to any raised concerns in a timely manner. Community teams should be able to relay facts about your concerns, and failure to be able to do so should come as a sign that something isn’t factual.

Experienced teams will recognise that although technology is changing the world, it is not without its glitches. It is not uncommon for technology to malfunction and most of the time it could be something very simple or minor that is easy to solve. This being said, if the project doesn’t have an effective action plan in place, it can appear that something more serious isn’t going on, examples include exit scams and hacks.

If the team knows how to quickly solve these issues, the community team should be equally as quick to notify those with interest in the project. Social media platforms such as Twitter, Telegram, Steemit and Reddit are all fast communication outlets that can get a legitimate message out quickly.

An example of the above negatively affecting a project, that many consider as promising and legitimate, was Icon (ICX). The circulating supply of coins increased by around 18%, and investors were not informed in a timely manner. This caused major concern on social media.

Source: Twitter

Although, the team and more experienced investors were aware that this was relayed in their whitepaper from the onset, it should have been clarified again closer to the time to avoid confusion, especially with newer investors. This could be seen as a fault by both of the project team and the newer investors, due to lack and communication and lack of research respectively.

The project team eventually clarified the situation a few days later, but it can seen as being a reactive measure action than a proactive guide.

Source: Twitter

Project teams should also be transparent with the community. This should include transparency on the amount of funds raised if the project went through an Initial Coin Offering (ICO’s). It should also include a proactive team that clearly engage factual developments to enhance investor confidence.

All teams should be profiled, be observed attending conferences, appearing in journals and articles or publishing blogs (or similar). Although regulation is very much lacking in cryptocurrency with divided opinion by many, the projects should at least be able to meet their legal protocols, which differ on matters concerning ICO’s and the like around the world.

What Should Raise Investor Concerns

Case Study On Marketing Of Products In Cryptocurrency: Odyssey Protocol ($OCN)

Cryptocurrency exchanges, coins and ICOs have often consulted “influencers” to shill or promote their product (depending on the specific example). It is not uncommon to see “influencers” not divulging that they are working with entities and therefore it is very difficult to determine if their comments are compromised.

The level of transparency around Initial Coin Offering (ICO’s) is typically very poor. Many ICO’s fail to deliver their described project and founders are often very guarded on where the money has or has not been invested. It is not uncommon to see an ICO project produce nothing and the money disappear. Project founders and leaders can also be just as guilty. You may think that coins or tokens that are out of ICO development are more secure, well… not really.

Odyssey Protocol (OCN) was one of the most talked about projects on “Crypto Twitter” in 2017 / 2018, piggy-backing onto the Tron (TRX) hysteria. The project leaders Yi Shi and Justin Sun were putting out collaborative videos and media posts, while the Odyssey project promised a meaningful partnership / wallet integration with a large bike sharing company (oBike: a global bike sharing platform) operating in Singapore. The near future appeared to be very promising, with OCN touted as a top 20 market cap coin.

Fast forward 12–18 months and the promising bike sharing partnership has fallen through, and the project leader Yi Shi is close to non-existent in his communication with the social media community. Without going into any of the technical aspects of where the project may have faltered, the communication from the project and the project leader to the community appeared completely disorganised. A primary example of this is the project appeared to promise a significant 1:1 airdrop.

Source: Twitter

This caused a great amount of excitement with the wider cryptocurrency community on “Crypto Twitter”. Enter the “influencers”!

Below is an example of a “Crypto Twitter Influencer”, who was one of many to pour praise upon the Odyssey project. It is very difficult to know if “influencers” are being genuine, have undisclosed working partnerships with companies, or have undisclosed working partnerships with other “influencers”, as seen in pump and dump groups.

This particular “influencer” strongly stated that he would not be selling his OCN coins.

Source: Twitter

The above statements were made after the coin had considerably pumped.

Source: Coin Market Cap via Twitter

The chart below displays the date when the statement by the “influencer” was made.

Source: Trading View

The coin went on to pump strongly again after this statement, followed by a colossal dump to all-time-lows. The huge hype caused by the project team and exacerbated by the “influencers” suddenly disappeared. So, what caused the dump?

The 1:1 airdrop that appeared to be promised by the team at OCN turned out to be a totally misinformed and confused affair. The actual airdrop turned out to be a new token that they named OCP, that didn’t appear to have a specific purpose, and was airdropped on an interim basis per OCN coin held by the individual.

Understandably, the community became very concerned with these uncertain developments, especially those left holding coins at a financial loss to what they invested.

Source: Twitter

Source: Twitter

This led to the project team releasing clarification on what the actual airdrop was going to entail.

Source: Twitter

With reference to the chart below, the clarification by the team was far too late for the wider audience to act, and the project had already dumped considerably.

Source: Trading View

The episode above was exceptionally hyped by project leaders and “influencers”, however the actual details behind the hype were, from the onset, sketchy at best or a total scam at worst. There were numerous people investing into the project and the hype hysteria brought more buyers as the coin approached the top of the referenced chart. If the wider audience were to have followed everything that the project team and influencers were relaying to them, then this clarification by the project team came far too late for the wider audience to sell their coins.

Upon review of this information, it can be seen that there were many red flags to indicate something wasn’t quite right. The world of cryptocurrency is largely operated by anonymous individuals and often there are many unknowns. If something doesn’t feel quite right, this should be enough to not invest in a project or sell your investment before it is too late. Trust in your intuition and ignore any baseless hype.

Case Study On Marketing Of Services in Cryptocurrency: Eric Choe

Eric Choe is someone who has gained a substantial following on social media through trading advice and now promotes and sells his services for his paid group and his “trading course” via his website. The paid group was previously investigated on previous article, “Cryptocurrency: An Investigation into the world of Cryptocurrency Paid Groups”. The aim of this case study is to gain an understanding behind the marketing of his services, with the aim to draw in potential customers.

Eric came onto the scene at the height of the bull market and gained a sizeable, but questionable, following very quickly (again covered in article “Cryptocurrency: An Investigation into the world of Cryptocurrency Paid Groups”). Eric went onto stimulate a large interest, but consistently referring to a day trading signal provider referenced as “Roderick”.

Source: Twitter

Eric frequently referenced “Roderick” without ever providing any substantiation as to what it actually is and how it works. If you were to consider buying into Eric’s marketing of “Roderick” by subscribing to his paid group for around $1,000.00 per annum, or his trading course on his website for $299.00, please raise the internal question to yourself, “on what evidence and solid facts do you have to make this decision, other than uncritically following Eric’s claims?”.

It must be considered that Eric stands to significantly profit from both of these services, though there is nothing factual for the potential customer to base their judgement for entering such a costly agreement.

Source: Twitter

It was also questionable about other accounts that were marketing “Roderick” at that time. The account below was formed in February 2018 and had no followers.

Source: Twitter

The account went onto immediately promoting “Roderick”. It is also worth knowing the account name and handle.

Source: Twitter

The aggressive marketing of “Roderick” turned out to be successful for Eric, as numerous people made the decision to subscribe to Eric’s services. Further to entering the paid group, it became apparent to customers that the “Roderick” A.I. Signal Provider was not comparable, as marketed. Members of the wider community were left feeling like they had been misled.

Source: Twitter

Once Eric had gained a substantial number of customers and gained a health amount of revenue, “Roderick” disappeared without ever being introduced. Eric went onto to use something named Wizard in his group, which was nothing more than a standard trading technique using Moving Averages (MA’s).

Eric quickly deleted all references previously made to “Roderick” in his private group, in what appeared to be an attempt at covering it up.

Source: Twitter

Source: Twitter

Eric has also assertively marketed his services through his website (www.cryptochoe.com). As previously mentioned, the website appealingly markets the subscription to his training course for a one-time of payment of $299.00.

Source: www.cryptochoe.com

The first thing to notice about this marketing is its suggestive nature. The course appears to rate itself 4.9/5.0 stars, there is no basis that this can be rated upon, therefore the authenticity of this rating is very questionable. The second concern to note is the claim that the course has been purchased “over 5,000 times “. This is an internal claim made by the party selling it to the wider audience, therefore without further substantiation, this claim should not be trusted investment material.

Through further research, it also came to light that the “trading course” was a reactive measure, due to complaints in the paid group that people were being deceived.

Source: Twitter

Members of the wider community initially believe that they would receive some tuition in Eric’s trading course, however it turned out to be 6 short videos covering very basic technical analysis theories that are found in more detail in many places such as books, educational trading content on websites such as YouTube and through free content put out by respected traders.

The content of the videos appears to be comparative to the concept that the “trading course” was a reactive measure, due to complaints in the paid group that people were being deceived.

Below is a summary of what is contained in each video.

Lesson 1: Eric Choe’s Market Scanning Guide

This short, 9-minute video discusses the elementary process of scanning the market-based volume and volatility of coins. Eric advises to use the Google Search Engine to search for the volume on coins.

Source: Eric Choe Video 1: Market Scanning

This search leads to Eric reviewing volume on www.coinmarketcap.com.

Source: Eric Choe Video 1: Market Scanning

Finally, before the end of this short video, Eric explains how to plot on the chart Fibonacci Pivot Points.

Source: Eric Choe Video 1: Market Scanning

Lesson 2: Eric Choe’s Ultimate Counter Trade Strategy Part I

This 12+ minute video discusses Eric’s trading strategy of trading on confirmation (confirmation on a chart is the basic description that a chart pattern showing a sustainable stock trading opportunity).

Eric’s preferred trading analysis is using Elliot Wave Theory (a method of market analysis that is based on the idea that the market forms the same types of patterns on a smaller (lesser degree)and larger (higher degree) time-frames and that these patterns provide clues as to what might happen next in the market).

Eric provides a very basic description on using Elliott Wave Theory.

Source: Eric Choe Video 2: Counter Trade Strategy

Eric goes on to provide a basic account of moving averages. The exponential moving average (EMA) is a weighted moving average (WMA) that gives more weighting(or importance) to recent price data than the simple moving average (SMA) does. The EMA responds more quickly to recent price changes than the SMA as well.

Source: Eric Choe Video 2: Counter Trade Strategy

Eric completes the video by providing a straightforward explanation on what a Relative Strength Index (RSI) divergences. (RSI Divergence is a potent tool that can spot potential market reversals by comparing indicator and market direction).

Source: Eric Choe Video 2: Counter Trade Strategy

Lesson 3: Eric Choe’s Ultimate Counter Trade Strategy Part II — Counter Trade

This 9.5-minute-long video is basically an extension of Elliott Wave Theory, that discusses placing generic equally placed bids using Elliot Wave Theory alongside Fibonacci Pivot Points.

Source: Eric Choe Video 3: Counter Trade Strategy II

Eric also discusses the difference between Waves in different timeframes, which is essentially just common sense that a wave on the 15 minute time frame isn’t comparable to a wave on the 4 hour timeframe, thus creating sub-waves.

Source: Eric Choe Video 3: Counter Trade Strategy II

Eric goes on to say “after watching this you will be able quit your full time job”.

Lesson 4: Eric Choe’s Ultimate Trading Strategy — Levels & Volume

This short video is 20.51m long and is the longest of Eric’s 6 videos. In this video, Eric begins by discussing what volume profiling is and how it can be used to mark a significant level, such as a potential support or resistance level.

Source: Eric Choe Video 4: Ultimate Trading Strategy

The remainder of Eric’s video largely discussed Fibonacci support and resistance levels alongside volume profile, reviewing areas of liquidity to set basic targets for buying and selling.

Source: Eric Choe Video 4: Ultimate Trading Strategy

Source: Eric Choe Video 4: Ultimate Trading Strategy

Lesson 5: Eric Choe’s Ultimate Trading Strategy 3: Trading With The Trend — 100X Profits

This short video is 9:32 and basically repeats the material that he discusses in “Lesson 2: Eric Choe’s Ultimate Counter Trade Strategy Part I”. In this video Eric discusses trading in areas of an uptrend or a downtrend only, which again is just logical rather than something unique or surprising.

Source: Eric Choe Video 5: Ultimate Trading Strategy

Eric also repeats using Exponential Moving Averages, focusing on the 200MA that he has marked yellow in the chart below.

Source: Eric Choe Video 5: Ultimate Trading Strategy

Lesson 6: Trading Example 1 — Counter-Trade Strategy

This video is just under 13 minutes and concludes the “trading course”, Eric discusses how he would place a bid alongside using Elliot Wave Theory, Exponential Moving Averages and Fibonacci Support and Resistance levels.

Source: Eric Choe Video 6: Ultimate Trading Strategy

The content of Eric’s videos does not constitute a trading course. Eric is not tutoring the customer on how to trade, and is merely a very brief overview of basic trading strategies. There are many free resources available that offer this type of basic narrative, but in greater detail. There are members of the wider audience that have purchased the “trading course” that felt this was sensationalised and did not offer any unique training or guidance information. From the balance of the evidence that has been reviewed, this notion appears to be correct.

Source: Twitter

The wider community also provided further feedback to support this concept, stating after they had purchased elements of Eric’s course or group, that upon request to cancel they were ignored.

Source: Twitter

Source: Telegram

Source: Telegram

Source: Twitter

It is not only unfortunate, but also dishonest, if these customer requests are now being ignored, but it only goes to strengthen the case of how important it is to do your own due diligence in the anonymous world of cryptocurrency.

Conclusion

One of the most significant skills that you must possess is being able to isolate facts in this largely unknown sector. Your investments should be based on solid facts. If you are investing in coins, read whitepapers, check coin fundamentals and learn the basics of trading, so you are not putting blind faith into hype. An old saying captures this essence perfectly, “be careful who you trust, the devil was once an angel.”

This approach should also be applied to the marketing of services, knowing how to isolate valuable information from misrepresenting claims. If people are trying to sell their services for your financial recompense, are the claims that they are making based upon any supportive evidence, or is it sensationalised inaccuracies aimed at purely at tapping into potential customers emotions to receive financial remuneration.

“The best investment you can make, is an investment in yourself. The more you learn, the more you’ll earn.” (Warren Buffet)

Closing Statement by The Author

My work is totally free and is to provide credible sources to help others. If you appreciate the time I have spent and would like to make a gesture of goodwill donation, please see my cryptocurrency wallet addresses below:

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Thank you for your time and I hope that you gained something valuable from this article.

About Crypto Strong

Crypto Strong is a freelance cryptocurrency content writer, as well as a passionate contributor in Technical Analysis and Charting.

Honesty and integrity are paramount values to Crypto Strong, he continually helps cryptocurrency followers, both new and old, progress in this up and coming industry.

Crypto Strong is passionate about autism awareness and is a fitness enthusiast, also helping many people in both of these fields.

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