Premium Daily Crypto NewsletterFebruary 8, 2018
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Crypto Market Commentary
Today coins hold gains and stocks do not
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Today’s biggest news is that Binance, which in January became the world’s largest cryptocurrency exchange, took their trading platform offline to address an issue with their database.
While their trading system is still offline, we anticipate they will be able to bring it back momentarily (at this moment it’s scheduled for 11PM EST / 4AM UTC). Expect some market volatility when they do.
The cool part is that they can prove they weren’t hacked. As some people were starting to accuse them of hiding a hack, they proved otherwise by providing their BTC and ETH wallet address to prove all the money is currently there, with positive balances of $263M and $151M worth of coins respectively.
We applaud the handling of this situation by the Binance staff and CEO, as the market is quite fragile right now and people could have easily worked themselves into a bearish frenzy if rumors of Binance being hacked or having stolen funds started circulating.
All that being said, this again highlights the need to move funds off exchanges if you care about security and accessibility. While today’s downtime is not likely to result in a negative outcome for the market, tomorrow we may not be so lucky. It’s inevitable that a large centralized exchange is going to have funds stolen or lost. They are prime targets for hackers wanting to have a big payday.
Don’t let yourself become a victim like those who lost funds at Mt.Gox and Bitfinex. Protect yourself by researching the best wallet for your particular cryptocurrency, and moving it off the exchange you bought it from. You’ll sleep better at night knowing your money is safe and secure.
Binance’s solution to disprove the hack rumors is similar to another case of rumor smashing we saw last summer. Vitalik Buterin, the genius behind Ethereum, was rumored to have been killed in a car crash, and as a result the price of Ethereum started to slide. Vitalik himself quashed the rumors by posting a picture of himself with the current block of Ethereum, definitively proving that he was alive and that the picture was taken at the exact moment he posted it.
This is the power of an immutable shared public database we know as the blockchain. Anyone can verify Vitalik’s and Binance’s reponses to be accurate and true because they have access to that information. While these might seem like silly examples that are nothing more than rebukes of Twitter trolls, we see them as shining examples of the power contained within blockchain.
Talk to you this weekend.
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Offense – Adding Trades
Offensive Actions for the next trading day:
- No specific actions.
Defense – Managing Risk
Defensive Actions for the next trading day:
- No specific actions.
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.
VeChain is a global leading blockchain platform for products and information. VeChain is the world’s leading Enterprise-focused dApp/ICO platform for products and information. It aims to connect blockchain technology to the real world by providing robust infrastructure as well as IOT integration, with scalability up to 10,000 tx/s and pioneering in building real world applications. This is being achieved through partnerships and collaborations with innovative brands and industries. As of today, VeChain has established partnerships with PricewaterhouseCoopers, DNV GL, Renault Group, KUEHNE+NAGEL, D.I.G., China Unicom, etc., and accumulated extensive experience in an ever expanding list of industries including pharmaceuticals, liquor, auto, luxury goods, retail, logistics, supply chain,food and cold storage and more.
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.
Simply put, ICON ($ICX) is a massive scale blockchain Platform that allows
- Decentralized Application (DAPPS) – Build DAPPS on ICON Platform like on Ethereum and NEO. Yes, soon, you will see ICOs happening on ICON platform for different DAPPS
- Interchain (Interoperability with Blockchains) – Allows different blockchains connecting to one another through their protocol. ICON is fully compatible with traditional blockchains like Bitcoin and Ethereum and in future can bridge other public blockchains such as Qtum, NEO and many others to achieve their mission statement – “Hyperconnect the world”
- Artificial Intelligence (AI) – Use of AI to ensure all nodes contributing to ICON Republic/platform are rewarded fairly and not to have certain powers over distribution policies. AI will continue to learn a variety of variables to determine optimal distribution policies and achieve complete decentralization.
- Decentralized Exchange (DEX) – ICON will integrate different DEX protocols on their platform to facilitate exchange of ICX and other future ICON platform currencies. Bancor protocol will be their first DEX protocol when mainent launches this month end and Kyber and others will follow. Not just throwing Kyber’s name out there, it was confirmed they are working with each other, official partnership yet to be announced.
Ripple ($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.
Fundamental Currency Research
In an interview with Bloomberg, the Winklevoss twins, who are the owners of the exchange Gemini, weighed in on the current bear market. What they stress is that to invest in cryptocurrencies is to need perspective. They bought Bitcoin when it was only $8, and so they are looking at the recent correction as little more than a much-needed establishment of a support level on our way to higher highs.
Today the top ten cryptocurrencies had a small gain. Of them, Bitcoin Cash ($BCH) clearly stood out with the only double-digit gains. This is due to the interview between Infowars’ Alex Jones and Roger Ver, BCH’s biggest cheerleader. While we are not fond of Mr.Ver for a variety of reasons, we do respect the work that has gone into making a Bitcoin fork.
Another article has come along to proclaim Bitcoin and cryptocurrencies as the hot asset among millenials. Some interesting points raised: People between the ages of 18 and 39 are less likely to invest money in the stock market than other generations. Only one in three millennials are investing in the stock market, compared to 51 percent of people of the following generation (36-51) and 48 percent of baby boomers (52-70). Over 82 percent of millennials say their investment decisions were influenced by the Great Recession when $14 trillion in wealth was lost. Some 12 percent of millennials aged 18 to 34 said they’d invest it in cryptocurrency over any other type of investment versus 3 percent of those aged 45 to 54 and 55 to 64. One explanation: Bitcoin was created after the 2008 financial crisis as a means to exchange money without relying on big banks. It should definitely be considered that cryptocurrencies may be the investment vehicle of choice for younger generations, and more so as they gain valuation.
Clearly, this is brave new world we are building.
One of our picks for the top 10 coins in 2018, Enigma ($ENG) is launching their data marketplace. The Enigma Data Marketplace — powered by ENG utility tokens — will initially serve Catalyst, their professional platform for data-driven cryptoasset trading and investment. When fully deployed on the mainnet, this will mark the completion of Phase 1 on the Enigma roadmap. Very exciting times for this crypto.
Watch our video discussing the Binance downtime here:
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 Good. Retirement is very untapped in crypto.
What is it?
The world’s first retirement plan platform with traditional and cryptocurrency assets, powered by smart contracts & robo advisory.
From their whitepaper: “Across the globe, individuals and governments face the reality that people are not saving enough to meet their retirement needs. We are living longer, and the implications of longevity are broader and more urgent than many of us are willing to acknowledge. Globally, life expectancy has grown by nearly 50% since 1950 and 30% since 1980 alone . These changes are occurring at a time when the need for financial advice has never been greater, as savers grapple with global and geopolitical uncertainty, prolonged low and negative interest rates, and longer lifespans. Retirement savers are often left out of decision making. They are inadequately addressed and feel disenfranchised. In addition, they are not offered the transparency needed to be well informed and are treated in a paternalistic manner. Furthermore, client preferences have changed. A recent Accenture study found that clients increasingly prefer to have a mix of robo and human advisory. In addition, they feel more and more comfortable to tailor their own portfolios. However, for many retirement savers, creating a saving portfolio can seem like an overwhelming task. In recent years, dedicated, but local retirement plan services like Betterment and Wealthfront or Nutmeg have addressed this need for tailored, transparent and robo-advisory driven retirement portfolios. At Auctus we believe we can even go a step further, cutting out all middlemen by utilizing blockchain and smart contracts, as well as allowing retirement savers to aggregate their entire retirement savings, from regulated 401k/IRA plans, voluntary traditional investments as well as cryptocurrency investments. This holistic approach allows running analytics and robo-advisory on the entirety of savings, enabling the retirement saver to take better decisions and ultimately reach their saving targets faster.”
What is our verdict?
What we like: A very untapped area in crypto. If you like this, also check out BitcoinIRA (not a coin)
What we don’t like: Retirement is a tricky area. 20% for the team is a little bit much if they are truly going for the long term.
Technical Analysis Research
We are seeing a modest lift-off from the bottom over the past couple of days; what seems like only a 2-3% bounce is actually a 43% change in value in BTC, for example. I’ve gotten lots of questions over the last few days from investors anxious to buy the dip and get moving….isn’t it better to buy in at $6000 than wait for the price to “confirm” as it’s rallying above $10,000?
Certainly a valid question/concern. Here’s my issue: what is low can get lower. There’s nothing magical about the $6000 price level that will impel the price to stop there. A trendline? Maybe. Enough buy orders have to flood in to create a floor of support. My preference is to buy what is rising, and not try to chase a coin down the rabbit hole.
I’ll say this again: that is my preference. I am a trader and a risk manager who is measured with his application of capital. I do have assets that I consider myself an “investor” on and my approach is completely different on those; I will be much more aggressive to add on dips in price. My point is that there is no ONE way to do this, and it entirely depends on your own approach, and your station in life.
We held an excellent class recently, Introduction to CryptoCurrency Trading. (Click here for more information and to sign up) This class is really targeted at the Crypto investor who wants to get moving but is somewhat uncertain about what they should do, and how to go about it. Another great candidate would be the recent investor who bought in at the top and is unsure of their actions. While you can’t attend the live class and the Q&A any more, the content is all there and we give you the slide download as well.
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I am going to stick with the current list of holds and will not go into “swing” mode until we get a release off the bottom. If we see any coin showing particular strength I’ll detail a short-term swing. I can definitely see adding to my WTC position which is somewhat underweight as compared to Mav.