Digital Slowmad newsletter
21 January 2022
Crypto portfolio update
Invested in: Jewel (JEWEL), USD Coin (USDC)
Net return: 537.3%
Comments: The price of JEWEL is going through its largest correction since launch, in the wake of a combination of factors:
- The TradFi markets are down, as well as the broad crypto market
- The Harmony blockchain was under spam attack, clogging up the network and rendering the game largely unplayable
- Technical issues with the in-game Tavern drastically slowed down the buying and selling of heroes
- Gen0 hero prices continued to fall due to an imbalance of incentives (covered in the previous newsletter)
- People have started to sell and buy locked JEWEL
My thoughts on the corresponding points:
- In my view this is the biggest issue. It's hard for altcoins to stay at elevated prices when the broad market sentiment is bearish. My priority now is to manage risk and "survive" until the overall market picks up again.
- The Harmony devs appear to have fixed the problem (as of 2 days ago) and the network is now running smoothly.
- The DFK devs have just (as of yesterday) applied APIv6 to the Tavern and so far players are reporting good things about it. Hero sales are picking up again.
- No changes on this front.
- The trading of locked JEWEL has likely resulted in the JEWEL price chart looking worse than things really are. I wrote about this here.
Ngl, it feels bad to see my paper gains fall by half, but that's the nature of the game we're playing; After all, JEWEL did rally 300% from Dec - Jan. Such volatility is par for the course.
The question is: Has JEWEL now become a bad investment?
I don't think so. While I may not be as optimistic as those predicting a $100 JEWEL price, I think the current ATH of $22 is still undervalued.
So this is - in my opinion - a question of timing. Right now things are looking ugly across all markets and I'm not expecting a swift recovery. It will be some time before we see a $22 JEWEL again, and one possible catalyst for this is the upcoming AVAX expansion (due March 2022).
Some copium: When JEWEL shot from $4 to $22 in just 8 weeks, unhealthy economic imbalances built up in the game; This was the dynamic that led to falling Gen0 JEWEL prices, among other issues. The "problem" was that the JEWEL price vastly outpaced the rate at which the game was being developed.
So in a sense, this pullback buys the DFK devs some time to further build out the game. When Crystalvale launches, the influx of new players will hopefully push prices back up again, this time backed with more extensive game functionality and more varied token utility.
Until then, my plan is to keep playing the game and accumulating JEWEL.
My current allocation:
DeFi Kingdoms stats
Users (30 days): 181.6k (-33%)
Transaction volume (30 days): $1.82b (+23%)
Number of xJewel wallets: 32,878 (+37%)
Discord members: 74.7k (+16%)
Food for thought
Attention is the oxygen of conflict. When you fight a problem, you breathe life into it. When you starve a problem of your attention, you suffocate it.
In a surprising number of cases, the way to solve a problem is to ignore it. Some things are better off ignored than attacked.
- James Clear
Thanks for reading, and have a great weekend.
P.S. If you have any questions or feedback, let me know at: chris[at]digitalslowmad[dot]com