People act under the assumption that the power law is some fundamental property of the universe. But it seems the 10x effect exist partly due to network-effects, and partly due to a minimum barrier requirement for liquidity. It's economically infeasible to support mini-size IPOs because the fixed overhead cost of regulation, auditing, legal work, and underwriting is too high.
With all the stigma associated with ICOs, lower barrier to liquidity may be a good thing overall. The power law phenomenon incentivize entrepreneurs to take excessive risks and force VCs to adopt extreme portfolio management strategies.
There's the greater fools theory. People are happy to spend $100k on something that they believe they can turn around and resell for $150k in a month.
There's also an anchor effect from loss aversion. If I bought a crypto-cat for 1 Ether, and then Ether price increase by 300%, I might refuse to sell the crypto-cat for less than 1 Ether, even though there's no intrinsic reason for my cat to appreciate at the same rate as the base currency.
> (Bluegogo) holds tens or even hundreds of millions of dollars in deposits from its approximate 15 million users, which many now fear cannot be refunded.
These guys took millions from users in the form of deposits.
So this takes 15% fee vs 30% for Coinhive. With almost non-existant barrier to entry, it seems like commission would be driven down to what traditional mining pool cuts (1% or less)
Financially, having the option to do X has a certain value, even if on average X isn't valuable. (If X has volatility)
Startups has a certain risk characteristic that is different that what you can find on the public equity market. Theoretically, an efficient market should dish out higher reward to compensate for higher risk and poor liquidity of investing in startups. It may be beneficial to individuals to use startups to diversify their overall portfolio.
Startups in general might not be a great investment. The subset of all YC startups might be.
Researching and investing in startups is fun and educational.
Is the control on the yuan really that tight? How are Chinese citizens able to buy such a massive amount of premium Seattle/SF real estate with ease? Isn't ownership of foreign real estate a big leak?
The formula is more complicated than this. Services such as shapeshift.io guarantee the price for 10 minutes, as well as sending purchased tokens almost instantaneously. To accomplish this means keeping inventory and becoming vulnerable to volatility risk and liquidity risk.
Picking a reasonable bid-ask spread is hard, and probably involves more input factors than the 4 you listed above.