XEcoins: Profit from the Grey Rhino

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In the world of cryptocurrencies, markets are overwhelmed by positive and negative sentiments. Black swans fly due to the lack of supervision. Cryptocurrency exchanges are hacked, and governments continue to intervene, these events have become increasingly common. Nevertheless, like the Black Swan, the Gray Rhino Phenomenon is usually ignored.

What is a Black Swan Event?

The Black Swan event is a metaphor that describes an event that comes as a surprise, has a major effect, and is often inappropriately rationalized after the fact even with the benefit of hindsight. The term is based on an ancient saying that presumably black swans did not exist – a saying that became reinterpreted to teach a different lesson after black swans were discovered in the wild.

The Black Swan Event causes markets to become extremely volatile within a short period of time and theorizes that the market will return to normal very quickly. For example, the China government’s supervision of ICOs and the attack on cryptocurrency exchange, Binance, by hackers. The difference between these 2 events is that the latter event was man-made, and there is always a solution for man-made mistakes.

While the Black Swan only makes the market volatile in a short period of time, the Gray Rhino is able to impact the whole market infrastructure. The Gray Rhino is a phenomenon in which people choose to acquiesce or ignore. Their implications are usually bigger than the Black Swan.

One recent example in the cryptocurrency world is the listing of Bitcoin futures on the CME and CBOE at the end of last year. Everyone was aware of this news and was influenced by the optimistic atmosphere in the market so they chose to ignore the potential negative consequences of the listing. This is an example of a Gray Rhino. The result was that the price of Bitcoin dropped from $20,000 to $6,000.

So how can we profit from the Gray Rhino?

Use the inequality of information to know the consensus of the market. When people are still in fear, we should be objective and search for every profitable opportunity in detail. Even if there is only a small opportunity, it may reap lots of profits.




via CCN https://www.ccn.com
May 18, 2018 at 09:42AM

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