The cryptocurrency space is red-hot right now. Indeed, crypto investors are now pursuing the cryptocurrency universe for unique options. In this regard, Holo (CCC:HOT-USD) has become an intriguing option for many investors. So, what is Holo?
Holo is a distributed cloud hosting network. Peer-to-peer applications and transactions are possible with Holo, utilizing Holochain.
Essentially, Holochain’s open-source protocol allows for scalable peer-to-peer applications. These can take the form of financial, social media or collaboration applications, and the potential really is limitless. The innovation Holochain provides makes this crypto option a unique one for investors looking for real-world use cases for crypto today.
The intriguing piece about Holochain to me is the flexibility this framework provides its developers and nodes. Developers and app publishers can set the hosting specifications of what they need for their various applications. And nodes/app hosts get paid via HoloFuel for hosting these same distributed apps. Each charge their own rates, and prices vary based on supply and demand.
This innovative technology makes serious sense. The white paper spells everything out in more detail, but I’m intrigued.
Now, the question is: Should investors consider Holo an investment opportunity?
Holo’s Value Exists Within Its Network
What’s interesting about HOT (the Holo token) is that it’s basically a dead token.
Well, HOT was created in 2018 during Holochain’s initial community offering. These tokens were initially created as “IOUs” to be transferred to HoloFuel when the system was up and running. Accordingly, the supply of HOT is fixed according to whatever was issued way back when. HoloFuel is really the underlying currency of the Holochain network. It’s what developers, and those hosting the network, exchange as a medium for services rendered.
The funds raised by the initial offering of HOT were used to develop Holo and Holochain. Now, those holding HOT tokens can exchange these 1:1 for HoloFuel as a straight swap.
I came across an intriguing Medium piece which highlighted five factors driving the value of HoloFuel. These are worth sharing:
- “Current market for decentralised and centralised hosting through Ethereum, Amazon Web Services, and others
- “Demand for distributed computation, personal data ownership, and hosting
- “Number of hosts, and their prices based on ability to run on cheap hardware
- “Popularity of apps and usage levels of hosting power on the Holo network
- “Relative demand from hosts for redeeming out into each reserve currency”
Again, HOT, or HoloFuel, is really valued on the basis of the laws of supply and demand. It’s a unit of exchange that is valued by users within the network. Future supply is potentially unlimited and can be created at any time. Accordingly, it’s not a traditional cryptocurrency token as most investors understand them.
So, Is It Worth a Buy?
My take on HOT or HoloFuel is that unless you’re using the platform, it doesn’t really have value.
That said, it’s intriguing in the sense that there’s a real way to value this cryptocurrency. If one can measure supply and demand, similar to other commodities, one can estimate what the true intrinsic value of HOT or HoloFuel is. I like that.
However, I’ve not dedicated the intellectual horsepower to doing so. I’d be curious to see if anyone else has.
For me, these alternatives to blockchain (Holochain isn’t blockchain — the creators make this crystal clear) are certainly intriguing. It’s too early for me to say how much value these will have in the long run. Additionally, I’m not a speculator. I like to buy things I can easily assess the value of.
Thus, I’m out. However, those intrigued by Holochain and the implications this network provides may indeed do very well with an investment. I’ve been wrong on crypto since the beginning. But I’m just happier on the sidelines; it’s a less volatile place.
On the date of publication, Chris MacDonald did not have (either directly or indirectly) any positions in the securities mentioned in this article.
Chris MacDonald’s love for investing led him to pursue an MBA in Finance and take on a number of management roles in corporate finance and venture capital over the past 15 years. His experience as a financial analyst in the past, coupled with his fervor for finding undervalued growth opportunities, contribute to his conservative, long-term investing perspective.