Premium Daily Crypto NewsletterApril 4, 2018
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Crypto Market Commentary
Market Erases Gains
Bull Trap Confirmed
The market erased all gains from yesterday’s rally. Thankfully volume is remaining steady.
As we warned you yesterday, the coin Centra ($CTR) lied about their partnerships, they scammed people in their ICO, and the founders are getting arrested. Despite this, the coin has bounced back 55% today. Do not fall for it. Use this as a lesson for how immature this market is.
The organizers had claimed in 2017 that they had a Visa and MasterCard debit card service that would allow users to “instantly convert hard-to-spend cryptocurrencies”—but no such relationship with those companies apparently existed.
“We allege that Centra sold investors on the promise of new digital technologies by using a sophisticated marketing campaign to spin a web of lies about their supposed partnerships with legitimate businesses,” Stephanie Avakian, co-director of the SEC’s enforcement division, said in a statement. “As the complaint alleges, these and other claims were simply false.”
We are exiting our position in Verge ($XVG). After the very questionable fundraising campaign at the end of March where they asked for millions from their community in order to reveal the name of a new partner, we downgraded it to a T4 position. We saw this move by the team as unprofessional, and when they concluded the campaign they announced that they wouldn’t reveal the name of the partner until April 16th. Now today it was revealed that they had a major breach of their network that allowed a hacker to essentially reward themselves with Verge coin every second.
We understand that network attacks and hacking happen all the time in a new technology space like crypto. What we don’t tolerate is when legitimate questions and criticisms are censored on the community forums in order to try and minimize a problem. Not only that, but the “fix” they put into place did not resolve this issue and the hacker was able to continue to compromise the Verge network.
We wish the Verge community luck with their investments, but we will be staying far away from this one from now on.
Talk to you tomorrow.
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Offense – Adding Trades
Offensive Actions for the next trading day:
Defense – Managing Risk
Defensive Actions for the next trading day:
- Exited XVG position.
How to read this portfolio: Please click on the Chart Key tab above for definitions and color codes. The colors correspond to our 7 categories in the graphic below.
ReadySetCrypto’s 7 Categories Of CryptoCurrency
Tier 1 coins are those coins which we have considerable assets invested, are firm believers in the project direction and execution, and have very little reason to sell within short to mid term. These are coins which we risk evaluated to be very solid, and have a high probability of existence duration.
NEO ($NEO) is classified as a Dividend and Platform coin. As our largest holding, we believe NEO has the potential to become a dominant smart contract and DApp platform in 2018. It’s four most compelling features are:
- An innovative consensus algorithm which will allow for greater TPS (transactions per second) over its competitors.
- A dividend structure for holders, incentivizing coin retention and network stability / diversity.
- SE Asia location, enabling NEO to break into markets more easily than competitors.
- Agnostic smart contract language, allowing for smart contract developers to use existing mainstream programming languages, which allows for cheaper smart contract implementation as compared to Ethereum who’s proprietary smart contract language, Solidity, can be a barrier to integration.
NEO is best acquired through Binance. Storing NEO on the Binance exchange will result in a GAS distribution once a month on the first. We recommend the NEON wallet for safe storage. GAS will be distributed on the NEON wallet daily.
WaltonChain ($WTC) is classified as a Dividend and Utility coin. Waltonchain is on the cutting edge of using RFID hardware to enable supply chain management 2.0. We believe Walton has the potential to become a dominant IoT blockchain solution Waltonchain is the only truly decentralized platform combining blockchain with the Internet of Things (IoT) via patent pending RFID (Radio Frequency Identification) technology. The custom RFID chips are able to digitally sign and verify transactions at the integrated circuit level, automatically and instantly reading and writing data to the chain without human intervention. This unique implementation of blockchain + IoT facilitates the true interconnection of all things in the real world with the virtual world, creating a genuine, trustworthy and traceable business ecosystem with complete data sharing and absolute information transparency. Walton has two major competitive advantages:
- A recently confirmed (to be signed) partnership with China Mobile’s IoT Alliance. China Mobile is the largest mobile telecommunications service in the world as well as the world’s largest mobile phone operator by total number of subscribers. Walton’s Management system is set to be implemented through mobile communication networks, and China Mobile is the largest one. Waltonchain is positioning themselves to be the single connector of the entire Internet of Things initiative put forward by the China Mobile IoT Alliance.
- They implement the blockchain through the RFIDs at the foundational layer. Their technology is patent-pending and gives Waltonchain a solid claim as the only blockchain that connects the physical world with the virtual world with truly reliable data. This is because all other IoT solutions tag items through API, and this means all the data is first passed through a centralized intermediate, a potential point of vulnerability.
Ethereum ($ETH) is an open blockchain Platform that lets anyone build and use decentralized applications that run on blockchain technology. Like Bitcoin, no one controls or owns Ethereum – it is an open-source project built by many people around the world. But unlike the Bitcoin protocol, Ethereum was designed to be adaptable and flexible. It is easy to create new applications on the Ethereum platform, and with the Homestead release, it is now safe for anyone to use those applications.
OmiseGO ($OMG) is classified as a Dividend and Utility coin. OmiseGO is a Southeast Asia-based company creating an e-wallet that will make transfer of assets and currencies possible. Merchants and users of the wallet can transfer whatever asset or currency they desire. For example, you could use your ethereum, bitcoin, international fiat, or even your airline points to buy groceries using the e-wallet app on your mobile phone. Transfers can happen across borders, or even while traveling abroad. Unlike Western Union or PayPal for example, the fees are almost negligible, and the transfer is instant. Because it’s based on a blockchain, there are no intermediary banks necessary and users don’t need bank accounts to access those funds. This is especially good for migrant workers who send money home and often don’t have bank accounts and are forced to use expensive wire services instead.
NAVcoin ($NAV) is a Privacy coin with upcoming Platform features. NAVcoin has been around for 3 years. It is not minable, instead being based on a Proof of Stake system in which stakers earn 5% annual returns. Theoretically this means there could be 5% inflation on the supply, however, that would require every coin holder to stake, so likely there will be very marginal inflation between 1 and 3% year over year. It is a currency originally based off of Bitcoin version 0.13, which should tell you it’s got a good foundation from which to build its feature set. Being based off Bitcoin, it currently is a method of transaction, with notable upgrades in the form of Segwit (with possible lightning network integration in the future) and 30 transaction times with extremely marginal fees. That’s great but a lot of coins have that going for them, so thankfully we’re just getting started with the real interesting pieces of NAV. The first and currently only implemented feature, NavTech is a unique dual blockchain technology. Essentially, NAV runs on these two blockchains in order to completely disconnect the sending wallet (your wallet), to the receiving wallet (where the money is getting sent). Think of it like a VPN, NavTech completely strips the sender’s details so the transaction is completely anonymous. The anonymous transaction space has really gotten big lately, with Monero’s recent price action and Ethereum’s implementation of ZKSnarks being two big examples that come to mind.Moving on to the roadmap, there are two big upcoming features for NAV:
- The first is Polymorph, which is a really cool blend of Nav’s anonymous transactions and Changeally’s instant exchange. What this means is that, for example, I wanted to pay someone in Bitcoin but I wanted to do it anonymously. Polymorph would take my bitcoin, turn it into navcoin in order to be processed and sent anonymously using the Navtech dual blockchain, then turned back into bitcoin at the to be sent to the receiving wallet. This will certainly set NAV apart, as it guarantees anonymous transaction for all of the coins on changeally. This is huge for exposure, and a great opportunity for NAVcoin to gain trust, which is absolutely critical anonymous transaction coins.
- The second big upcoming feature is ADApps, or Anonymized Decentralized Apps. This is also a huge potential win for Nav as there is already a huge amount of interest in the crypto space surrounding Dapps, such as Ethereum and Omni. Adding in the anonymous layer would attract projects that would value the anonymity. Nav is still in the planning stages for this project so it could still be awhile before it comes to fruition, but we should see the whitepaper for it soon, and if they could be first to market with ADapps that could prove to be a killer feature for them as it would give them first access to the interested demographics.
Ripple ($XRP) is a real-time Payment protocol for anything of value. It’s a shared public database, with a built-in distributed currency exchange, that operates as the worlds first universal translator for money. Ripple is currency agnostic and has a foreign exchange component built right into the protocol. Ripple acts as a pathfinding algorithm to find the best route for a dollar to become a euro or airline miles to become Bitcoin. It will look at all the orders in the global order book. The case for XRP comes down to the following: 1) Payment systems work best with bridge assets to focus liquidity. 2) There are good reasons to expect a cryptocurrency to be the most popular bridge asset. 3) There are good reasons to expect that cryptocurrency to be XRP.
- Open, decentralized payments will have lots and lots of assets, including national currencies of all kinds and cryptos. A significant fraction of payments will be among assets that aren’t the most popular. Using intermediary assets to settle those payments concentrates liquidity and reduces spreads.
- National currencies are always tied to jurisdictions and can’t be universal. Systems built around them will never be as open and inclusive as systems that aren’t.
- XRP settles faster than any other major crypto. It higher transaction rates than other major cryptos. It is beat by others only by the amount of liquidity available today. And, most importantly, XRP has a company that is devoted to making sure XRP succeeds for this specific use case.
Tier 4 coins are coins which we have minimal stake in, are highly risky, and we are contributing no more than 2% of our portfolio to. These coins represent the outer fringe of our risk analysis, in that we have little information to work with, have little insight into the coin’s performance, and at the very best we are making an educated guess that they will be successful. If a coin performs well and proves that it has a commitment to its compelling feature, it will be moved to the Tier 3 status.
Simply put, ICON ($ICX) is a massive scale blockchain Platform that allows
- Decentralized Application (DAPPS) – Build DAPPS on ICON Platform like on Ethereum and NEO. Yes, soon, you will see ICOs happening on ICON platform for different DAPPS
- Interchain (Interoperability with Blockchains) – Allows different blockchains connecting to one another through their protocol. ICON is fully compatible with traditional blockchains like Bitcoin and Ethereum and in future can bridge other public blockchains such as Qtum, NEO and many others to achieve their mission statement – “Hyperconnect the world”
- Artificial Intelligence (AI) – Use of AI to ensure all nodes contributing to ICON Republic/platform are rewarded fairly and not to have certain powers over distribution policies. AI will continue to learn a variety of variables to determine optimal distribution policies and achieve complete decentralization.
- Decentralized Exchange (DEX) – ICON will integrate different DEX protocols on their platform to facilitate exchange of ICX and other future ICON platform currencies. Bancor protocol will be their first DEX protocol when mainent launches this month end and Kyber and others will follow. Not just throwing Kyber’s name out there, it was confirmed they are working with each other, official partnership yet to be announced.
Fundamental Currency Research
One of the biggest topics in cryptocurrency is mining. There’s debate if it’s good or bad, useless or revolutionary, but we’re not going to get into that today.
Instead we want to talk about ASICs, or Application Specific Integrated Circuits, and how they are related to cryptocurrency mining. Without getting into a lot of detail, mining is used to secure the network by perform a lot of mathematical guessing. This guessing ability, or hashing power, is a measure of a computer’s capability to make a certain number of guesses per second. The more guesses per second, the higher the hashing power. Mining is more or less a lottery to correctly guess the perfect hash for each block. Think of the infinite monkey theorem: Given an infinite length of time, a monkey punching at random on a typewriter would almost surely type out all of Shakespeare’s plays. The more monkeys we have, the more likely it will happen sooner rather than later.
In the same way, the more hashing power we have, on average the more likely we are to make money from mining. That’s why a mining farm made up of thousands of computers mining in rural China where the electricity is cheap is going to be many times more profitable than a single computer running in the middle of NYC. Ok, that’s obvious, but it’s not just the number of computers affecting the total hashing power, it’s the type of computers. Or, more specifically, the hardware being used to mine. When Bitcoin first started, it was mined using CPUs, or the central processing unit of your computer. This is good, but because a CPU is so multifaceted and tasked with doing many things to keep the computer running, it’s not the best miner. So, mining shifted to GPUs, or graphical processing units. This is much better because GPUs are more efficient at computing hashes given they can be tasked more specifically. They don’t have to worry about much more than being a miner, which makes them better suited for maximizing hashing power. If you’re a computer gamer, you’d know that the prices of graphics cards have skyrocketed in the past months due to the rise in popularity of cryptocurrency mining. What’s also great about GPU mining is that it’s much more profitable due to the sheer scale of what you can do with it.
Where only one CPU can be used for a single CPU miner, you can have 8 graphics cards all mining on one computer! This makes the overhead cost of hardware more committed to buying better graphics cards than worrying about the other components of the computer. But what if you could buy an all-in-one solution that was far superior to mining with CPUs or GPUs? Where CPUs and GPUs have to be good at many different things, this device would have one single purpose: to mine cryptocurrency as fast as possible.
This is what an ASIC is. It is built as the final evolution in the pursuit of faster hashing power. And it naturally splits the crypto community in two. After all, if an ASIC is only produced by a single company, that company can charge what they want for it. When only those who can afford the ludicrous price acquire them, they then make CPU and GPU miners obsolete. It then becomes an arms race of whoever has the most ASICs. If there’s a new version of the ASIC or the coin it’s designed to mine changes, the older ASIC becomes essentially worthless. This is in stark contrast to GPUs or CPUs, which can mine many different cryptocurrencies and have high resale value.
The reason we’re discussing ASICs is that two prominent cryptocurrencies that were GPU dominated, Ethereum and Monero, just had ASICs developed for them. This would mean that miners currently using GPUs to mine these coins will now be severely out-competed by ASIC miners.
Thankfully, both development teams behind these coin in particular have publicly stated that they will “hard-fork” to alter their coin in order to prevent any developed ASICs from working.
While it solves today’s issues, it’s certainly concerning that nearly every major cryptocurrency mining algorithm has had an ASIC developed for it. It could be that mining becomes a purely ASIC dominated space, as it’s already looking like. We don’t like this possibility as ASICs are typically bought up in large batches by those who have the means, meaning the networks they mine on are now much more centralized.
Whatever happens, it will be interesting to watch the cryptocurrency community evolve as ASICs become more dominant while more mainstream and institutional investors enter the space.
As we mentioned last month, the ICON team have been working to allow you to swap your ERC20 ICX tokens with the new ICX tokens.
Read the full article on the ICX token swap here.
“Now, we plan on exchanging the ERC20 ICX tokens to mainnet ICX coins so that we can further develop and expand the usage of ICX coins. The Token Swap will be made with an exchange rate of one ERC20 ICX token to one mainnet ICX coin.
How will the Swap be made?
The Token Swap will be implemented through our ICONex wallet and the exchanges that we are listed on.
- Token Swap using ICONex
Using the Token Swap feature in the ICONex wallet, you can directly exchange your ERC20 ICX tokens stored in the ICONex ETH wallet to be exchanged and moved to the ICONex ICX wallet as mainnet ICX coins.
- Token Swap using exchanges
If you are holding your ERC20 ICX tokens on the exchanges, you do not need to go through a seperate Token Swap process. The exchanges will automatically swap the ERC20 ICX tokens to mainnet ICX coins.
When will the Token Swap begin?
The Token Swap feature in the ICONex wallet is currently ready. However the Token Swap schedule through the exchanges are still being adjusted.
We are postponing the Token Swap so that both Token Swap processes can be started at the same time.
The exchanges currently do not support mainnet ICX to be traded. If the Token Swap process using the ICONex wallet is opened before the exchanges support mainnet ICX coins, it could lead to unintentional trouble or financial loss where you cannot sell the mainnet ICX coins in the exchanges.
(Once the Token Swap is made, the mainnet ICX coins cannot be swapped back to ERC20 ICX tokens)
To protect users from any unintentional trouble or financial loss, we have made additional developments so that the ICONex Token Swap feature will be enabled aligned with the exchange’s status of supporting mainnet ICX coins. (You are free to check the feature, but the actual Token Swap does not happen at the moment.)
We will be announcing the start time of the Token Swap through our SNS channels(Blog, Reddit, Telegram) and email as soon as the exchanges are ready to trade mainnet ICX coins. The Token Swap feature will be enabled accordingly.
Will I be able to trade ERC20 ICX tokens?
The current ERC20 ICX tokens will be tradable in the exchanges as usual. Also, even after the Token Swap procedure begins, you will be able to trade and send your ERC20 ICX tokens until the Token Swap period is over.
How long will the Token Swap last?
The Token Swap will last for three months. The exact starting date will be announced once the exchanges are ready to trade mainnet ICX coins. We will be continuously sending notifications through our SNS channels and email. You can swap your ERC20 ICX tokens to mainnet ICX coins anytime during the Token Swap period.
Will the ERC20 ICX tokens be burned?
When you swap the ERC20 ICX tokens for mainnet ICX coins, we will retrieve the ERC20 ICX tokens and exchange them for mainnet ICX coins in return. The ERC20 ICX tokens retrieved will all be burned so that it will not be able for further use.
For the ERC20 ICX tokens that do not participate in the Token Swap procedure, they will be locked after the Token Swap period is over so that not even the ICON foundation can use them.”
In this section we’ll feature a daily ICO or new coin we think you should check out. Based on your country, you may not be able to participate in the ICO, but you will be able to trade the coin once it is listed on an exchange following its ICO (usually only a couple of weeks). ICOs are where a lot of money in crypto is made. Here’s proof. That said, we should warn you: ICOs are highly risky endeavours and you need to mitigate any potential losses. Treat it as money you’ve lost the moment you contribute to the ICO. We are not responsible for the ICO’s performance. Today’s featured ICO / New Coin is:
For flipping Neutral.
For long-term holding Positive.
What is it?
A mineable multi-chain protocol for stable coins, decentralized exchanges, and meta contracts. Building a stable global state of the entire blockchain ecosystem. No validators, master-nodes, or centralization of any kind.
What is our verdict?
What we like: A potential game-changer. Very unique and could be a great addition to our portfolio in time.
What we don’t like: Too few milestones and missing some information we need to see on their website.
TOKEN SALE: 13 APR – 14 APR
- Ticker: EMB
- Token type: OWN WALLET
- ICO Token Price: 1 EMB = 0.0700 USD
- Fundraising Goal: 7,000,000 USD
- Sold on pre-sale: 4,000,000 USD (NO BONUSES)
- Total Tokens: 300,000,000
- Available for Token Sale: 33,33%
- Whitelist: YES (20 MAR – 20 MAR, JOIN )
- Know Your Customer (KYC): YES
- Accepts: ETH, BTC
Technical Analysis Research
And just like that, the last two days of gains were given back. I hate to keep saying this but until we see a draconian level of capitulation, markets will not recover. And actual revenue from a crypto-based company might help as well. Transformative technologies always take time to get from the “innovators” to the “early adopters” and then finally into the “early majority” market where the real revenues lie.
My focus in the short term is going to be building a short-term swing trade solution. I know the basics of what I want to build, after which the intent would be to broadcast any entries/exits into the Telegram group. I might begin trialing a second bot-trader in the near future; the current vendor that I’m using appears to be working well, it’s just….hard to use and to understand and is not for the faint of heart. If you have trouble navigating our member’s area, you’d find it impossible to use. Eventually I will do a full bake-off between these vendors.
If you missed Wednesday evening’s webinar, “More Profits in 2018; Ten Ways to Chart Like a Pro.” then you can catch the replay here. My new class “Introduction to Technical Analysis” is now available via our online store.
If you go to buy any of our courses at our online “store” you can receive $10 off the $59 street price with your member’s “coupon code” of member18crypto..
Coinigy is a great tool for determining prices on each exchange, however I may not have access to the full suite of tools on TradingView charts. I am currently not using it as a front-end GUI for my exchanges, which it supports.I also use Blockfolio to give me a quick snapshot of my holdings, and find that it does an excellent job to aggregate all of my holdings into one easy-to-read snapshot of my cryptocurrencies, which are typically located in many different places.
I will also be experimenting with the Profit Trailer app which might be useful in this choppy market. I hope to share results and tips/tricks with you in here once I get this bot up and running.