Pareto Network; Separating the Signal from the Noise in the Circus named ‘Crypto’
I was first and foremost trained in the field of neuroscience long before I started studying finance. I know, strange turn of events, don’t ask, story for another time. Although naturally the details of my learning have faded somewhat, there are some basic principles of the mind, so elegant and logical, that they are difficult to forget. These “rules” or “laws” can usually be applied to many other domains of academic insight. One lesson in particular is important for my current analogy and to understand the function of Pareto in the greater crypto sphere. That is, the simple but highly effective mechanism of ‘boosting the signal-to-noise ratio’. Bear with me, we will get back to crypto soon. When we attend to information in our environment, two interlocking and cooperating systems, namely the dopamine and glutamate system enable us to filter relevant from irrelevant information. In a beautiful electrical spectacle of firing neurons they modulate, like the conductor of an orchestra, which neurons get to sound the loudest and which should silence down. They do this by enhancing neuronal activity that is relevant to the task at hand while simultaneously dampening the activity of neurons that transmit irrelevant or distracting information. That way they increase the signal to noise ratio, thus making sure the signal gets through. Ensuring we don’t get lost in a world that screams at us, a world that overwhelms us and drives us mad. In so doing, this well-designed interplay of two interlocking neuronal systems enables us to focus on only that which is important. To make weighed choices and be decisive.
A: Low signal-to-noise ratio. The true signal gets lost in the noise. B and C: better signal and higher signal-to-noise ratio but the noise is not dampened. D a good signal-to-noise ratio; signal is amplified while noise is dampened
Welcome to the circus that’s called crypto. A world full of bells and whistles, where everything is shiny and full of promises. Where everybody screams at us what we should and absolutely should not do, and where each coin proclaims to be the best. A domain of investing where marketing has taken over fundamentals and mere exposure of a project, irrelevant if it is a scam, seems more important than what the project has to offer. A world full of unqualified self-proclaimed crypto geniuses on YouTube, and expert analysts who have learned TA in two days. A world full of people with double agenda’s. Where we don’t know if someone genuinely wants to help us or shill a coin simply for his own profit. Where we, as a group of investors, heavily believed in Ian Balina only to find out he changed his strategy from “which ICO’s will give me the greatest returns” to “with which ICO can I use my following the best to make myself the most money”. Just look at the number of projects he promotes where he is an advisor, or where he has bought the presale with the crowdsale being a Dutch auction (ensuring biggest differences in sale prices between presale and crowdsale). I know he is an advisor to Pareto too, I don’t care I make my own decisions, but hey at least he got this one right.
While our brain automatically filters the unconsciously processed inputs, it has much more difficulty making conscious informed decisions. It tries to weigh in all the factors but by virtue of its limits, it cannot and never will. Psychologist have said this many times and neuroscientists are collecting increasing evidence that only a really tiny percentage of the decisions you ever made in your life is largely “rational” or based on the “facts”. It only accounts for decisions which lie within your field of absolute expertise, or for those that are automated. The more knowledge you have about a certain thing the better you are able to understand it outside your own frame of reference, your own emotions that rule your thinking.
So now tell me, how long have you been a crypto investor or trader? Or even a normal trader? An investor even? In other words, can you truly vouch for yourself as being an informed and well-research crypto investor? Can anybody in such a manipulated and volatile market? Unless it was a really bad mistake, we simply tend to forget all the times we make a bad decision in crypto and only remember the good ones. The one we hit a home run with. The dozen other times we lose on a coin we bought because we got “shilled”. We bought simply because someone yelled hard enough, or because the idea sounded good. Most times we put almost zero effort into due diligence on the feasibility of a project or the necessity for a blockchain, We bought because someone reviewed it with so much conviction it had to be true. Most wanted to give crypto up. Still we continue hoping for that one choice that will give that nudge in the right direction. Every day, literally every day in crypto, you can make a decision that would give you a 100% percent profit on your portfolio within a week.
Now I arrive at my key statement; if you could effectively separate the signal from the noise and know where to find key evidence, you could everyday make that one choice that would give you great profits.
Ok I get it, it sounds idealistic, and apart from straight up insider trading there is not a single (legal) way to find that information to help make that perfectly informed choice. But now we got something that comes pretty close; Pareto Network.
How Pareto guides the cryptoinvestor through the minefield
I know it starts to become cultist. Let me be, I love the damn project ok. Here we continue again:
Like a beacon of hope it guides us towards our best choices by letting the true expert doing the work. Well here is where it gets interesting. The people on Pareto Network can all contribute their ideas and new theories, their fundamental and technical analyses, their in-depth reviews, their finds on technological leaks, to the network by creating content and giving it a certain value. The users can then pay the content creators according to the price they deem the information worth. The more an information is worth the more pay a content creator can ask, ensuring people will be willing to pay the full amount to move up the ranking ladder, with a higher position ensuring access to new valuable profitable information earlier. That means if you set a price of 1 dollar worth of PARETO on your information, people are more likely to pay 100% of that fee and thus move up the ladder pretty quick, while if you set a price of 10000 dollars it will be much less profitable for a user to pay 100% or even 10% of the price to move up the ladder accordingly. This creates a genius psychological game whereby the value of information is organically determined. If someone posts massive inside information, he can ask a hefty price and will be guaranteed that people are willing to pay such a high fee for his information.
Now we get back to the brain analogy. The community of users therefore works as the dopamine glutamate system in our brain through their collective wisdom. When content is organically voted for or against, this means that there is a collective process of eliminating or promoting ideas and information. Namely the more people find a certain piece of information valuable the more likely it will receive higher percentage funding from all users and the more likely it is actually good info. Instead of their time, which many of us crypto traders have enough of, they pay with their money, their PARETO tokens, to vote on the most valuable information, thereby amplifying the signal we need to hear, while simultaneously dampening the noise that is uninformed or unvaluable. This ensures and ever increasing demand for quality content and an increased exposure. Together with the community of Pareto you thus work towards ensuring that you together find that gem, that sleeping giant piece of information.
The UI and user experience of Pareto Network has been very smooth for me. I actually use the tokens for their utility so for me PARETO is not a speculative investment but for those wishing to speculate I can just say the following: strong fundamentals, working product, ecosystem already growing each day, token has actual useful utility, and incredibly low market cap. Make up your own minds but I know what I would do. But as always my friends, DYOR this is not financial advice. Have a good cryptoday!
