The Beginning of 2020: Current Situation and Future Plans
Dear community, today we are ready to make the first official announcement in 2020 analyzing the price drop in the early days of the year and sharing future plans.
A brief history of FOIN
FOIN is a young project with a bold mission — to become the default cryptocurrency for the finance sector. Since its inception in early 2018, this ambition has pushed the team behind FOIN to make great strides, including the release of a multicurrency web and mobile wallet, payment & invoicing solution for merchants, exclusive partnerships with FSPs, such as Cyclebit, which allows FOIN to be used at more than 200,000 POS terminals, the organization and/or sponsoring of major crypto events, launch of the FOIN Foundation which governs the FOIN mission at a higher level, and last but not least, the acquisition of AliExchange, one of the most promising crypto-exchanges in the market.
All these efforts have been reflected in the market, with the cryptocurrency price reaching levels of around $4000 in late December 2019.
January price drop analysis
FOIN has been trading on select exchanges for more than a year now. Until recently, trading has been made by pre-approved crypto traders that were knowledgeable in market dynamics, supply and demand correlation and the majority of them were professional traders. On January 3rd, 2020, after all, coins were fully distributed, the exchanges where FOIN was listed were flooded with people trying to sell FOIN. For example, one of the exchanges where FOIN is listed, P2PB2B, has even had serious technical difficulties and had to perform a system upgrade due to the large number of people signing up and depositing FOIN in their platform.
Whether new or old in the crypto scene, most people hope that after they get their coins in their hands, their coins will make massive gains. This has happened to some coins in the past and made numerous people generous return, in some cases even triple digits or more, but it is not a guarantee in itself.
There is a common misunderstanding that a team can control the price of a coin after the coin distribution. In the physical world, a supplier can tell retail stores the price they are allowed to resell their goods. That is not the case with crypto. Once a coin is on the exchanges, the team who launched the coin now has no control over what the prices are, and cannot recover any losses, no matter how much they would want to jump in and help.
Sadly, this has been the case with FOIN as well. Following the coins distribution, there has been a massive spike in sell orders that has undoubtedly crashed the price to a historical minimum. Some of the factors that contributed to the price drop have been:
1. Bearish crypto market
The overall state of the cryptocurrency market is still bearish. BTC and ETH are not just coins but also measurements for the health of the cryptosphere, because you typically use one or the other to buy another altcoin, and that altcoin’s value is tied to the price of what it is exchanged for.
2. Supply and demand of the market
The volume of trading right now is another huge factor — it’s multiple times smaller in comparison to December’s high trading volumes. From a daily trading volume nearing $30 million to a daily trading volume of a few hundred thousand dollars, it is a clear sign that most of the people that have not panicked are waiting for the panic wave to fade out.
3. Lack of proper financial education
Many early contributors have invested without a proper understanding of the world they were entering. An 80% loss or more to someone who hasn’t seen it before is justifiably terrifying, even though this often happens with cryptocurrencies (see table below). There will always be people who are quick to sell everything to recuperate some of their perceived losses, not realizing that no loss occurs until they actually cash out, and they are creating their own self- fulfilling prophecy by selling lower than what they paid for it.
4. Supply and demand of the coin
The time immediately after the coins are distributed is mathematically the highest ratio between the circulating coin supply versus the number of people who know about that particular crypto project (compared to any time in the future). While almost everyone who is interested in the project already has their coins, there aren’t many newcomers who would like to buy these tokens straight after the coins distribution. High supply plus low demand equals low prices, and low prices equal panicking people, selling their coins at a lower price — causing more panic and more people to sell low, making everyone unhappy.
5. Telegram scammers
There have been numerous reported scams which took place in the official or unofficial Telegram chats. People eager to sell their FOIN coins and without a proper understanding of how cryptocurrencies work have fallen prey to ruthless scammers that duped them into handing over their FOIN. The support teams have made everything they could to block the reported scammers, but the unreported scammers were able to sell on the free market. A scammer with a few hundred FOIN could have amassed a serious amount of money and inflict damage on the market price. And because he had paid nothing for the coins, he had no incentive to keep the price up, thus negatively affecting the price.
Is the January price drop unique in the crypto world?
Like mentioned earlier, losses of 80% or more are very often in the cryptosphere.
All of the tokens in the table above raised enormous amounts of money and generally had a lot of hype around them. TRON is a Top 15 currency by market cap. TenX and Bancor are regularly in the Top 100. That’s despite their massive losses — because everything is losing right now.
Despite the big obstacles companies in the cryptosphere face, such as legislation inconsistencies, hacking or other negative events, most of the news around the world of crypto and blockchain, in terms of regulation and real-world adoption, have been very positive. Cryptocurrencies are beginning to trade on stock exchanges all over the world. Many banks are coming out with their own cryptocurrencies or partnering up with blockchain companies to use their platforms (such as Bank of Lithuania, Scotiabank, and more).
What can we do to increase the value of FOIN?
We cannot change what happened but we can control how we respond to the events that happened. Our response to the recent price drop is to double down our efforts and work even harder than before. By listening to our community, we have identified the following directions in which we will focus our efforts:
FOIN
- Seek out new partnerships with Financial Service Providers (FSPs), crypto companies or fintech companies that want to integrate or use FOIN as a transaction base layer.
- Enabling new users to effortlessly buy FOIN using a credit card or BTC directly on foin.io, without the need to register on a crypto exchange or have any knowledge of financial tools.
- Listing on different exchanges, especially the local ones where we have a high concentration of early adopters, such as Thailand, Indonesia, Malaysia, Taiwan, China, Japan, Singapore, South Korea, Turkey.
- P2P lending platform integration — provide overcollateralized loans in fiat currency to users that have a FOIN portfolio and do not want to sell their coins.
- Bounty program — reward users that actively contribute to the tech improvements in terms of security.
- Airdrop program — reward users that help promote FOIN on various channels (social media, networking events, press, etc).
FoPay
- Continue to onboard new FoPay merchants (we will extend these efforts even further to help businesses without an online presence reach a global audience).
- Create a marketplace similar to a merchant directory to present all the merchants; the merchants will be organized by categories and we will promote the businesses by putting them in front of all the FOIN community; We will also have a “Merchant of the month” story showcasing one of our merchants; Will organize monthly webinars for merchants on various topics, such as digital marketing, business improvements ideas and more.
- Enable direct payments for people that perform services and want to receive FOIN but don’t have a business or website (similar to how the PayPal payment button works).
- Credit card attached to your FoPay account — which will enable users to receive a debit card that can be used at any POS or ATM in the world.
- Bounty program — reward users that actively contribute to the tech improvements in terms of security.
FOIN Foundation
- Will maintain its mission to build a better future by investing in decentralized trustless systems such as the blockchain technologies, which don’t depend on any central authority.
- Will sponsor and attend crypto, fintech and startup events to look for more established businesses to bring under its umbrella (like the recent AliExchange acquisition).
AliExchange
- Keep developing the exchange software to bring it up to the standards of a Global Top 10 exchange; Trading engine improvements to accommodate more TPS (transactions per second); Transition to fully-automatic deposits and withdrawals; Enhanced security.
- Futures trading — Allow traders to perform derivative trading such as CFD (5x, 10x, 25x, 50x, 100x).
- Introduce a Loyalty Program that rewards users who frequently trade on the platform.
- Eliminate trading fees for FOIN / ALIC pairs.
- Bounty program — reward users that actively contribute to the tech improvements in terms of security.
Final notes
Even though the FOIN price has suffered serious losses, the FOIN, FoPay, FOIN Foundation and AliExchange teams are more determined than ever to work hard to regain the users’ confidence and trust. 2020 will be a year of stabilization and growth, which will require the precise execution of a consistent strategy across the board. The current market conditions are the result of a panic sale, triggered by emotions, and we are confident it will phase out sooner rather than later. Nevertheless, we will not let these obstacles from achieving our goal of becoming one of the top cryptocurrencies in the world.
There is light at the end of the tunnel, but the only way to get there is to believe in the project you helped to bring to life and hold onto your coins long-term. This requires a long-term vision, and how successful early contributors will be is in direct correlation with the patience they are willing to have. Remember, the cryptocurrency technology landscape is still in its nascent state, and this is just the beginning of the journey.
