Mark Cuban endorsed token 'TITAN' plummets 100%
Iron Titanium Token (TITAN) a DeFi token created by Iron Finance, experienced a bank run that began on June 16th and dragged the token’s price from $64.04 to $0.000000043348. The project was endorsed by the infamous American entrepreneur Mark Cuban and shed 100% of its value within 24 hours as investors rushed to liquidate their positions.
According to individuals familiar with the matter, TITAN’s tokenomics caused the sell-off to snowball into a bank run. TITAN is used to collateralize a stablecoin in the Iron Finance ecosystem called IRON. Individuals can mint new IRON by locking 25% TITAN and 75% USDC; when new IRON is minted, the demand for TITAN increases, but when the price of TITAN drastically decreases, the IRON peg becomes unstable.
As the price of TITAN began to fall, IRON lost its peg to the dollar ($1) and plummeted. This led many investors to believe that the Iron Finance project would not be solvent at the rate token values were dropping–which caused even more investors to quickly liquidate their positions so they would not be stuck with worthless tokens.
Crypto-mania part 2
It’s a bad sign when individuals start taking investment advice from internet personalities instead of doing their own research on an investment. Many investors blindly followed Mark Cuban into TITAN token, but while Cuban was miraculously able to sell the token near its all-time-high price, many of those who followed him into TITAN did not have that luxury.
Lately, the cryptocurrency space has been oversaturated with celebrities and influencers shilling coins and tokens to unsuspecting individuals that are merely chasing gains. Recently, the rapper Soulja Boy admitted that he was being paid to shill cryptocurrency. All of this is reminiscent of early 2018 as crypto-mania came to an end and the SEC began charging individuals like Floyd Mayweather and DJ Khaled for unlawfully promoting baseless cryptocurrency projects.
They say history does not repeat itself, but it often rhymes, and what we are seeing take place in the cryptocurrency markets today looks a lot like what we saw take place in the cryptocurrency markets from 2017-2018 when the sector was filled with purely speculative projects that had no real utility and a plethora of celebrities promoting projects.
What Mark Cuban is doing today is no different than what Floyd Mayweather was doing for cryptocurrency projects back in 2018. It may even serve as an indicator, showing us that where DeFi projects are at in their cycle right now is where ICO’s were at in their cycle at the beginning of 2018. If history does repeat itself, maybe it will be Mark Cuban who will be charged by the SEC this time around.
Regardless, as an investor, you always need to do your own research before putting any money down, and it is not wise to follow a tv personality or celebrity into an investment just because they endorse it; because as we just saw with Mark Cuban, they might sell the top on you while you are left holding a token that is on its way to zero.
Source: Read Full Article
