The end of Paycoin… for me… for now

Paycoin has had an interesting history. It began as a scam coin to cover up a mining hardware scam. When both of these scams were revealed, there still were plenty of people who believed in the coin. They closed down the original hashlet/hash staker “mining” site and replaced it with a special higher rate minting address that could be run from a QT wallet. In this way the original promise of lifetime hash stakers was still good. These special addresses were called Microprimes.

That lasted for about six weeks. One day the Microprimes broke and quit minting new coins. When I asked about why my wallet wasn’t minting any new coins, the developers told me the Microprimes were broken and there were no immediate plans to repair them. I was advised to load my coins on a staker on xpy.io, so that’s what I did. xpy.io was a Bitcoin and Paycoin wallet, and they were also starting up some kind of shareholder system. There was also a way by which you could load your coins onto a staker for a period of ninety days. I parked my coins on a staker on xpy.io and the small payments began to accumulate daily in my wallet.

I found it a bit ironic that after finally having closed down Zen Cloud, the centralized site where hash stakers staked coins for everyone, the only place to successfully stake Paycoin was on a different centralized site. The people running that site were more honest, though, and I never had any issues with getting my payments or otherwise using the site.

Then a couple days ago I received an email announcing the imminent closure of xpy.io. All the stakers would release their coins on April 3rd, yesterday, and all assets would need to be withdrawn by May 15. More information could be found by logging into one’s account.

I logged in and learned the reason. According to the pop up explanation, Paycoin’s reputation had suffered too much damage. I guess the development team felt they couldn’t overcome all the negatives from the way the coin started. So they are closing xpy.io and probably other sites related to Paycoin and launching something new.

The something new is a coin called ION, which will be part of the “Ionomy.” A quick perusal of the website identifies ION as a gaming rewards coin, and there’s also something called the “Electron” that is supposed to in some way add value to the coin or the platform or something. ION is currently conducting its ICO, and valuing each coin at 20 cents. There’s a fixed rate at which Paycoins can be exchanged for IONs. Other assets sold on xpy.io also have their fixed exchange rate with ION.

Another new coin to figure out.

I am not at a place in my life where I have time to research and make a good decision about investing in a new coin. I also have developed a policy to never buy a coin during its ICO because the price always drops substantially once the coin begins trading on the open market. The exception to that was XEM, where the initial investment got you 2.25 million coins and no matter how low the price of the coin dropped, an investor selling off all their XEM would have come out ahead. But any kind of ICO based on a fixed price of an individual coin is usually not going to be a good buy. I believe the people who buy into the ICO do so because they want to support the new coin. I wait until the coin goes on the market and then I watch the price fall before I buy in. Or, if I believe in the coin, I’ll start buying high and keep buying all the way down, and then try to pick up more during subsequent dips.

This means if I decide eventually to invest in ION, I’m going to have to wait awhile. In the mean time, Paycoin will continue to exist as a coin. However, with no more support or development its days are numbered. I decided to just sell off all my Paycoin at a loss (again!) and use the proceeds to pick up some cheap Neucoin. I have a substantial order for lower than market rate which I hope will fill over the next few days. I am now officially out of Paycoin, and expect I won’t get back in it unless someone revives it in a convincing way.

Since I haven’t kept up with the Paycoin forum or the slack chat, I can only speculate as to why after their valiant attempts to reposition Paycoin as a respectable coin, the development team chose to give up on it now, basically scrap the whole thing, and start all over with a brand new coin.

I am not sure that was such a great idea. In my opinion the biggest problem that plagued GAW Miners was that it was constantly changing. One day it was a mining hardware retailer, then it was a cloud mining platform, then it was a fake cloud mining platform, and finally it was a brand new staking coin. Then the entire leadership changed and the staking coin could no longer be staked on its original website, but in the QT wallet or on an altogether different website. Then the wallet staking broke. Then the second staking website closed down. That is way too much change for comfortable investing. In the early days I felt like if I didn’t spend a lot of time keeping up with the forums I might miss some important news which could cause the value of the coin to plummet within minutes.  This improved somewhat once the new leadership took over, but never truly disappeared. There was also a time when the coin forked and updating the wallet involved downloading the entire block chain all over again. For some people, it took more than one entire block chain download before the wallet worked properly again.

Part of the reason I do not see myself a likely investor in ION is that it seems to me to be more of the same chaotic change in direction which has characterized GAW Miners and Paycoin from the get go. I could totally understand perhaps changing the name of the coin. Perhaps the name “Paycoin” has come to be too closely associated with the GAW Miners scam. I can understand that. But why not just change the name of the coin to ION and then announce a new road map for the coin–a road map to be implemented in gradual stages. Such a road map could even include changing the coin’s protocol as long as it was done at a decent pace. Even the steady DNotes team is at least considering the possibility of fundamentally changing the underlying coding for the coin at some point down the road. If Paycoin had not been basically abandoned, but only given a name change, I most likely would have hung on to my coins for the time being. But I think it’s a better investment to sell them off and put the proceeds into a coin I already believe will perform well, and which has already suffered its post ICO drop in value.

This makes me think of another issue, and that is the increasingly crowded graveyard of altcoins which didn’t make it. And yet those coins still exist. The code is still there, and wallets are still out there. What would happen if instead of inventing a totally new altcoin from scratch, a development team with a vision instead decided to pick up an old abandoned coin and revive it? The coin would not need to be revived in its current form, and everything about it could be changed. But suppose all the people who found themselves still stuck with the coin suddenly got word that their coins were good again and were now off in a new direction?

I think about the SeedCoin lurking somewhere on my hard drive. I would love it if someone decided to revive it. I’d probably first notice when the coin’s Bitcoin Talk thread got updated, since I have my forum settings set to notify me of new posts. The fact that my dead coins might now have some value would excite me. I’d probably hang onto them while eagerly keeping up with new developments. If I didn’t like the new direction and the coin got relisted on an exchange then I’d probably sell and be done with it, but at least I’d get something out of it. More likely, though, I’d keep the coins and see what happened.

I personally don’t have the technical know how to take something like this on. Nor do I have the motivation or resources to promote a coin (old or new). But it just seems like it would avoid some waste if those new coin developers who do have all that would first take a look at the graveyard of altcoins whose first life is over. Perhaps there is one in there whose code would only require slight tweaking to fit the new vision. And voila! A recycled coin.

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