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Joined 1 year ago
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Cake day: July 24th, 2023

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  • It’s about hype and economics.
    Tech companies can theoretically scale well and are valued on the expectation of growth while normal companies are manly valued based on what they currently do. An app can basically be copied for free to millions of users once it has been coded and servers don’t cost that much. A traditional company, say a car company, that wants to increase profits has to build a new factory or something. The problems arise when a companies perception goes from startup/tech company to normal company.

    Example: wework was a startup that rented office space long term and lets it customers rent short term from them. Once people realized, that it was a real estate company and not a tech company it’s value plummeted, it couldn’t raise more capital and went bankrupt.

    Edit: spelling



  • For you to short something a institutional investor or market maker takes a long position on the same thing.

    For some reason legit institutional investors never really show up in the crypto sphere and the smart market makers don’t like to get high on their own supply (or are selling tokens they got at insider prices on the open market).