Friday, February 23, 2018

DigixDAO (DGD) Vindication

As many people know, DigixDAO is my FAVOURITE crypto for the longest time. In fact, it was the first crypto that I discovered that got me very excited enough to build a sizeable position.

I've talked about it during Cryptmas ($150 USD, 0.23 ETH) and also during my 2018 portfolio where I outlined the simplified thesis of DGD. ($200 USD, 0.16 ETH)

Well, currently we are at $300 USD and 0.38 ETH.

While DGD is fresh on the radar now for being a safe haven during crypto dips (and you can find a lot of recent reviews and explanation of this crypto on YouTube and around the net), this was not always the case. 

In fact, DGD used to be a downward-biased, leveraged ETH proxy. This means that when ETH dropped 5%, DGD would usually drop 8-10%. And then when ETH recovered, it would recover slower.

DGD was a terrible trade for the longest time until the start of February when it was doing it's crazy shit.


However, what is interesting to note, is that since that spike in February, DGD has since never gone back below it's theoretical NAV of 0.23 ETH. I highly doubt that it ever will. In fact, I was having some FOMO that I didn't fill my bags enough, so I just bought more a few days ago.


Yes, I bought DGD recently, even though, you know, "1 coin of DGD is so expensive". *rolls eyes to the back of the head*

To be honest, anyone recently buying DGD has it easy. There is actually volume and a good exchange to trade it on. When DGD used to be only on Bittrex and Yunbi (confirm 99% of you have never even heard of or used this exchange before) and it was a bitch to buy. Strangely, Yunbi had better market depth than Bittrex, so I found myself having to send BTC/ETH to this China exchange, sell it to CNY and then buy DGD in CNY and transfer out the DGD to myself. It was not the most delightful experience. Yall have no idea how good and easy it is to just have everything on Binance and not have to deal with other weird ass exchanges.

The daily volume on Bittrex used to be so low that I have to worry about moving the entire price of the market with my purchases. Nothing teaches you about order books and market depth like trying to buy DGD on Bittrex "in the olden days". And buy DGD I did.


As you can probably tell from my average price, I bought a shit ton in July when price was sub $60. I swear, it's no easy feat considering how goddamn illiquid the market was.

Since November 17, I have stopped putting in fiat directly to buy DGD. Instead, I found myself draining my ETH reserves the entire January buying the insanely cheap DGDETH ratio.


Oh yeah baby, that's right. I bought the freaking dip. All of these positions just 6 weeks later are now up 100% in ETH. How much is it up in fiat? I don't know. I used ETH to buy it and I'll sell it back to more ETH later, so that's all that matters.

Now, let's conclude.

I did not have any special insider trading news.
I do not possess any super human 6th sense of crypto prices.
I did not chart some special magical funny TA with triangles and whatnots.

I just bought a bleedingly obvious cheap crypto that was very much overlooked by the market.
In fact, DGD gave me the same vibes when I was hunting down Saizen REIT.

I was almost doubting myself that it can't possibly be so goddamn easy. But it was.
I manned up and bought a shit ton.

DGD is and was my perfect trade.
If I sell out my DGD now, my profit is 6 figures.
Yup, 6 figures. 'nuff said.

Well, that's if I do sell out now. Price might go up, price might go down, I have no idea. I am still holding on til it's release and adoption before I decide what I'd like to do with my position. Honestly, if things pan out the way that I imagine, my retirement is settled with my current holdings of DGD alone.

Anyway, the point of this post that I am trying to make is NOT to shill DGD. I don't give a rats ass if you buy it or if you short it.

The point that I'm trying to make in this post is that (1) crypto markets are EXTREMELY inefficient in pricing and (2) there are logical methods to value cryptos and the rewards are very very very handsome if you can do it right.

To be honest, I think that lots of traditional investors that do macro investing or deep dives into specific stocks and sectors would excel extremely doing crypto compared to the average crypto investor who knows jack shit. But then again, many are too high up on their horse and have publicly shot crypto as tulip bubble ponzis to even consider the possibility that they MIGHT have been wrong and that crypto isn't stupid.

I am will keep pressing their buttons. Because why not? I'm already all-in on this "forbidden path". Ahahahaha


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So that's the end of my perfect trade. I don't think it's pefect anymore since the margin of safety by the "NAV" is no longer there. The easy profits have already been made up to this point, which means that this investment is significantly more risky compared to itself just 2 months ago. It could possibly continue to be the best investment in the world based on a very positive rollout of DGX 2.0 and along with its partnerships integrating DGX and then having it become a massive crypto and a new standard of a stable global crypto currency. That's what I'm hoping for.

Or it could fail and fall back down to it's 0.23 ETH value. Or even lower.

Who knows? Definitely not me.

But from this point onwards, you're making a bet that DGX gets rolled out and adopted successfully. You can no longer make money from DGD failing. It has to succeed if you are entering at this point.

So, is DGD a good investment now? I don't know. But I own a shit ton.

Will the crypto markets go up? I don't know. But I actually expect 1 more big fat dip.

Good luck in Cryptoland. It is still a dangerous place out there.

10 comments:

  1. Any thoughts about how to cash out a large amount of money from Cryptos?

    ReplyDelete
    Replies
    1. Hi JD,

      I would think Gemini would be a good option.

      Delete
    2. Hi GMGH,

      Thanks. just that they are taking a long time to verify my account. Did not create one as I didnt want to use USD but the limit on coinbase is irritating. Nothing to do but wait and hold.

      Enjoy your blog alot thanks =)

      Delete
  2. Replies
    1. Siala, no wonder why pumped to $550! WHALE ALERT!

      Delete
  3. Watched in amazement last night as the 6,000 DGD sell-wall on Binance worth US$2.4 million held firm. The last I recalled it was slowly being chipped away. Think he sold about 300 DGD before thetprice retreated below $390.

    ReplyDelete
    Replies
    1. Hey TI,

      The volumes on DGD are insane, but it's a lot of whales splashing around and fighting each other. Lots of botting activity too.

      Do keep in mind that because Binance has the super reduced trading fees, it's very possible that a lot of the volume is washing trading to push the prices higher. In fact, that's my guess on this price action.

      Delete
  4. Now we are $500. Huat ar!!

    ReplyDelete
    Replies
    1. I see it at $550! 85% in 5 days is just crazy, lol.

      Delete

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