The Crypto Comeback of the Decade
Just this year the xtz or tez token has seen an increase in price of about 170, which isnt bad for a coin that isnt generally hyped and sometimes even disregarded by many crypto journalists. In the same amount of time, the token has moved up in market cap to the 30th largest cryptocurrency, but theres a lot to go through when it comes to tezoss history, a blockchain that has been admired, imitated and even mocked. So, stick with me through the end of this video, so you can better determine if you should add xtz to your investment strategy. So if you watch this channel, often youll know that one of the ways that i determine whether a coin is worth your capital or not, is by looking to the founders. Xtz has been around for a while and if you know the history of this blockchain, then youve got a pretty good idea of what the founders are capable of and what theyve been through kathleen and arthur brightman are the founders of tezos and theyre, fondly referred to As the first married couple in crypto during the ico craze of 2017. in tezoss early days, the breitmans were already seen as public intellectuals in the crypto space. Their careers in finance and computer science helped the public trust them and their blockchain innovations arthur had been a quantitative analyst at morgan, stanley and goldman sachs. Well, kathleen had experience at the hedge fund bridgewater associates and at the global consulting firm accenture.
However, their professional credentials were just half the story. If that wired magazine did an awesome report on their journey together, including how they met at cornell and where the idea came to build tezos. This includes the story of how one of their early partners set off a wild series of events that ultimately led to a 25 million dollar lawsuit. So the couple met got married and eventually grew to share a love of crypto closely following the developments of bitcoin and ethereum. So arthur and kathleen were some of the first to point out. The flaws in the proof of work model in both first gen crypto being bitcoin and second gen players like ethereum, specifically their criticism, was how governance issues on these earlier blockchains would make it difficult for the community to agree on how to change or upgrade projects. The breitman saw that forks on a network, as have happened on ethereum and bitcoin, would be detrimental to the idea of a trustworthy cryptocurrency, so picture living in an apartment building and that apartment buildings, maintenance and management is the responsibility of a central group a fork in A blockchain like bitcoin or ethereum is like that central group in this apartment building splitting the building right down the middle, each half having to abide by the decisions of their own side and then in the future. Each time the administrators cant come to another consensus. New splits are created and the building is further divided.
This would be terrible for the homeowners living in our imaginary building. The prices of homes will become extremely volatile and thered be far fewer resources for each segment within the building and the whole time. The residents would have little to no say in how their investment being in apartment in this case is affected by all of these changes, and this is effectively what happens when a cryptocurrency splits bitcoin obviously survived its hard forks, but for viable cryptocurrencies of the future. Stakeholders need decentralized governance. This way they can vote on how their blockchain should evolve in the future, and they can trust it long term. Music teslos was born as one potential solution to this. The brightmans took the concept of proof of stake and found a way to use this technology to let participants vote on upgrades to the tezos blockchain and even vote on the way that votes are processed. This sounds simple by todays standards, but the math behind this innovation, which you can read about in their white paper, was groundbreaking at the time. In many ways now there hasnt been much hype around tezos this year, which is possibly a reflection of the founders values. Its worth pointing out that both kathleen and arthur brightman have expressed reservations about the crypto hype machine and they have to be more enthusiastic about the functionality of their technology over the hype. The downside of this approach is the lack of marketing in tezos, but because of key partnerships.
The blockchain has made with financial companies nft marketplaces and corporations like ubisoft and red bull developers and investors have been curious as to what the future might hold here. So teslas proof of stake model, relatively low fees and decentralized governance, have become a breeding ground for experimental ideas. Now lets talk about what went wrong with tezos, and with this we have good news and we have bad news. The good news is that for all the trust issues investors have had in tezos in the past that 25 million dollar settlement they reached last year has wiped the slate clean, restoring faith in the founders vision for the ecosystem. The thing is: when tezos had its ico in july of 2017, it was record breaking at the time. There was actually plenty of hype around the xtz token because of the problems with ethereum that it was going to potentially solve blogs, went nuts. The ico actually raised 232 million dollars in just three days and only kept gaining momentum after that, but two things kind of happened in parallel at this time. In the weeks that followed the ico, the breitmans and their other collaborators fell into a dispute about who was responsible for what, with some accounts of the story, suggesting that one collaborator, a johann geevers, was self dealing and leaving the founders completely in the dark on how And when the blockchain would be up and running, and while this was happening behind the scenes, tezos value was skyrocketing.
By the time the lawsuits were filed, the companys assets shot above 700 million dollars. People knew that there were problems in the leadership, but they kept on buying the story ends with reporters piling onto the drama stoking fear that tezos was ultimately just a con and was seconds away from stealing it all. Hence the settlements: 16 million dollars of the 25 million went directly to investors that simply wanted out, but all of this drama seems to be behind tezos as they begin picking up steam again. The bad news is in the time that its taken teslas to recover other smart contract cryptocurrencies have stolen the spotlight at one point in time. The question was: could this cryptocurrency eclipse even ethereum many thought so for tezos, but ethereum continued being ethereum and tezos was a no show? Teslas very well could have taken third place in crypto exchange listings by now, but for reasons thoroughly discussed on this channel. Cardano has just had more public attention and now many more projects being built on its ecosystem once upon a time, tezos would have been top of mind when you heard the words proof of stake, but this scandal, as it was wasnt the only obstacle, the programming language, That arthur breitman used was o camel, and this is developed by the french government and some of their top universities. The problem is, this is a language that very few developers were familiar with. Even after tesos did finally launch their blockchain a year after its ico, it had an extra helping of trouble, getting people to actually build on it and to use it there wasnt enough users, there wasnt enough developers shortly after the launch, the founders left the management of Their blockchain to other people this way they could focus on other interests.
It was a complete mess and whenever crypto experts would refer to tezos theyd call it a ghost chain, a blockchain that exists that works, but just doesnt seem to have any participants. But now lets talk about the future. Despite the shock of getting sued, the brightmans are back in action at tezos. What happens next in tezos will be part of a redemptive arc, rather than a launch of something new and exciting, but it may just work out in their favor just this year. The network hit 10 million contract, calls thats people making transactions on the tezos network. Now kathleen breitman said in an interview that five million of those calls were from just this year. Nfts have also played a role. Several marketplaces for these assets have set up shop on tezos, most notably dojicat yeah. Her has sold an nft through one of which is built on the tezos blockchain. This instantly gave teslas a reputation for being an eco friendly network used by the cat, the nft sold for 188 thousand dollars. By the way, the applications for teslas network have only gone up since then. At the end of august, they announced partnerships with three swiss firms: incorp bank enacta and crypto finance group. They all announced that they would use tezos to develop dar one tokens. The tokens would use smart contracts to comply with quote anti money laundering rules and improve governance. Incorp bank has also launched staking services for the tezos token, and then this news comes on the back of their recent network protocol upgrade grenada, which finally introduced experimental dex features.
Users would now be able to stake their tes token to earn more tes through a feature called liquidity baking. This directly addresses one of tezoss growing pains the founders once upon a time aversion to trendy d5 projects, and this may be indicative to a complete change of mindset for the founders and their team. So things are looking great for tezos. In my honest opinion, the rate of adoption that were seeing for their technology and their smart contracts feels like a pipe dream compared to where they were at launch. It was once thought that teslas would be slow with its network upgrades a problem that comes with being fully decentralized, but the community of developers around the blockchain is quickly proving that wrong record. High transaction figures are a good sign that tezos isnt the ghost chain that people once love to dismiss. But when kathleen breitman says that itll be one of the top five cryptocurrencies that take 90 percent of the entire crypto market, its still tough, to say whether tezos will be among them or not, were looking at strong technology and growing support. But its on the back of past drama and failures which create additional risks to the blockchain and for investors. So, if theyre able to pull this off, this will be the blockchain comeback of the decade, and investors will be rewarded handsomely so thats going to do it. If youd like to see my full tezos research report, youll want to join my patreon there, you will also find my buy and sell alerts and a private community of investors spots are limited, so make sure you grab one while theyre still available id like to.