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February 13, 2018

 

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Crypto Market Commentary

Another Day, Another Bitcoin

Multiple U.S. Government Hearings On Blockchain Tomorrow 

 

This week we continue our rampage against the pitfalls you should watch out for in cryptocurrency.

One of the biggest are known as lending platforms.  

These are generally platforms where you put in an amount of Bitcoin, i.e., you “lend” it to the platform, and in turn you are “paid” guaranteed returns. That right there should be a red flag. Anything that claims to pay guaranteed returns, especially if they give a percentage per day, e.g., “make 1% returns daily!”, is likely a scam.

Of course, someone may make the comparison between guaranteed returns of lending platforms and averaged returns of Proof Of Stake coins, such as NavCoin, who advertise 5% annual staking rewards. The difference is that staking is helping to secure the network, and as a result of you are paid incentives for locking away you coins. Lending platforms are instead trying to get you to give them a valuable currency, such as Bitcoin, and they will prevent you from withdrawing that initial investment. To pay you, they will often give you their token in return. In this way, when they decide to pull the plug, they haven’t lost anything because they never cared what the value of their worthless token was, only how much of the valuable token they made off with. This is exactly what we saw with Bitconnect, which had a market cap of 2 Billion for their Bitconnect tokens at the time it went under, but likely they had way more in Bitcoin stashed away.

Here’s a list of known crypto scams and Ponzi schemes you should watch out for:

BCC Cash (note that this is different from Bitcoin Cash)
BCHconnect
Billion Bit Club
Binary Coin
Bit Sequence
BitAI
Bitchamps
Bitclub/clubcoin
Bitcoin Ascension (pyramid scheme)
Bitconnect X
Bitether
Bitfinite
Bitfintech
Bitglare Coin
Btchash
Btc-Rush
Btcwait
Chrysos
Coinrium
Cointeum
Coinspace
Dascoin
Ecomcash
Eigencoin
ETHconnect
Etherbanking
Exacoin
Falcon Coin
Farstcoin
Ficoin
Firstcoin
Forzacoin
Futurecoin
FUU Coin
Gold Reward Token
Goldgate
Hedgeconnect
Hextracoin
Home Block Coin
HotCrypto
Hydrocoin
Ibiscoin
iCenter
Ideacoin
iFan
Iotaconnect
Knox Coin
Legendcoin
Lendconnect
Lendera
Libra Coin
Liteconnect
Loancoin
Martcoin
Moneroconnect
Monetize Coin
Monyx
Neoconnect
Numiv
Oalend Coin
Onecoin
Pagarex
Purpose/DUBI
Regalcoin
Rothscoin
Secular Coin
SFICoin
Steneum
Stepium (pyramid scheme)
Swisscoin (pyramid scheme)
Tenocoin
TEX Coin
Thorn Coin
Ucoin Cash
Unix Coin
USI Tech
WCI
Western Coin
XRPconnect
Defunct ponzi schemes:

Ambis
Bitcoinly
Bitconnect
Bithaul
Bitlake
Bitpetite
Bitsupreme
Btcbox.cc
Chain.Group
Coinreum
Control Finance
Cryptodouble
Davor
Ethtrade
Laser Online
LoopX
Mavro
Mecoin
Metizer
Microhash
Paycoin
Plexcoin
Thunderbit
Vixice
Vone

As you can probably tell, there’s a lot of them, and more are popping up all the time.

Additionally, you can check if a coin is likely a scam by searching for it on http://www.badbitcoin.org/thebadlist/index.htm

Lastly, the best defense is common sense. Ask yourself, “does this sound too good to be true?”, which in the context of crypto is a bit of a non sequitur, but it is absolutely true. In crypto it is absolutely possible to make a lot of money, but for some who believe more than they think rationally, the harsh reality is that it’s absolutely possible to lose a lot of money.

If nothing else, if you see a coin or platform that you’re not quite sure about, email us and we’ll check it out. We’ve got a lot of experience in looking for red flags, and the last thing we want you to do is get involved in the next Bitconnect or Davorcoin.

As we talked about yesterday, centralized exchanges are the least secure place to store your funds. Most notably last week 130 Million dollars worth of Nano ($NANO) was stolen from the exchange Bitgrail. Today Cointelegraph interviewed the now infamous owner, Francesco Firano, who bluntly stated that it’s, “ . . . impossible to refund the stolen amount.” This of course is to be expected given Firano’s reaction to the hack has been to place blame on the Nano developers and call his customers, “idiots”. Clearly, exchanges are where your funds are least secure.

One of the most interesting stories we saw today was this one from Coindesk, where they reported that salon.com, an online news publisher, is giving readers a choice between seeing ads or mining Monero.

“We automatically detect your current processing usage and assign a portion of what you are not using to this process. Should you begin a process that requires more of your computer’s resources, we automatically reduce the amount we are using for calculations.”

We think this is a revolutionary solution to the ads vs. ad blocker debate that’s been going on for a few years now. A few other coins that are trying to solve this issue using cryptocurrency are Basic Attention Token ($BAT) and Oyster Pearl ($PRL). Ads are intrusive and can even be harmful to users, so having a way for users to still receive free content while paying for it using resources they don’t even consider is a brilliant compromise.

 

If you missed our class “Introduction to Cryptocurrency Trading” that we held on last weekend, it’s available now in our Premium Member’s Home as an archived class for those that purchase it. You can view more about it and watch the class today by visiting this link here.

Watching on Mobile? Click this link to watch in HD

Click here for audio link of today’s video

Offense – Adding Trades

Offensive Actions for the next trading day: 

  • Adding NANO position (re-entry, details below)

Defense – Managing Risk

Defensive Actions for the next trading day: 

  • Removed NANO position

Current Portfolio

    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.

 Tier 3

NANO

Nano uses a technology called DAG ( Directed Acyclic Graph ) Nano offers us an alternative to bitcoin as it solves two of the big problems that BTC has Slow transactions High commissions Nano offers us the solution that being a currency that does NOT depend on MINERS, its ecological impact is less, since by not promoting mining the energy consumption is enormously low compared to the cryptocurrencies that use the miners for the creation of coins and the confirmation of transactions, and by not depending on miners for the confirmation of transactions, they are free of any commission.

Tier 4

OriginTrail

OriginTrail enables seamless data sharing along any supply chain. The decentralized, blockchain-supported network protocol ensures trust, transparency, and security. It helps companies exchange relevant data seamlessly and in a secure way to build accountability, protect their brands and increase efficiencies.

LociCoin

Currently the inventing process is convoluted, expensive, and stifles progress. In short, the process is broken forcing many inventors to go straight to market with their idea or never follow through. InnVenn is designed to reform the inventing process through simplifying the process and making it efficient, thereby increasing the possibility of new inventions, innovations, and inspiring the next big idea. Loci holds numerous patents to protect our IP, but our InnVenn product development has been guided by the main patent “System and method for fuzzy concept mapping, voting ontology crowd sourcing, and technology prediction.” The ideas covered in this patent have been researched and developed since 2008 and is the bedrock of what we are doing at Loci.

None for today.

 Tier 3

REQ

SUB

LINK

Tier 4

XBY

BNTY

TAU

WISH

TRAC

PHR

How to read this portfolio: Ticker: Contains the ticker code for the coin. You can search this ticker in Coinmarketcap to learn more about the coin. The color denotes the risk tier by our evaluation. Dark Red = T1, Dark Green = T2, Dark Blue = T3, Light Blue = T4 (Colors in the Ticker column do not interact with the colors in the other columns) Cost Basis = Our average purchase price for this coin. Current price = The average price of the coin based on the exchanges it is listed on. Strategy = What we plan to do with this coin. Staking is receiving dividends for that coin. Master node is also staking, but with a higher return rate for having a (large) number of that coin. Stop = Our exit point, if it exists What do the colors mean? The colors in the ticker column represent the risk profile of that coin. The colors in the other columns reflect what sector(s) that coin belongs to. Some coins belong to multiple sectors, which is indicated by multiple colors. 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 ($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

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

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.

Tier 2 coins are those coins which have performed extremely well, we have a large amount of assets with, and we believe will continue to operate with high marks. What separates these coins from our Tier 1 status is a flaw or they haven’t yet proven their defining feature, though we believe they will.

OmiseGO

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

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.

ICON

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

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 3 coins are those coins which we have moderate investments and we believe have a possibility of high performance in the future, but as of yet have not shown enough performance to reduce their risk profile. Tier 3 coins are coins which are moderately risky, but due to our risk analysis of the project and team we believe have minimal chance of failure. 
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.  

Fundamental Currency Research

Tomorrow two subcommittees of the U.S. House of Representatives will consider potential applications for blockchain in government.

The hearing, “Beyond Bitcoin: Emerging Applications for Blockchain Technology,” will begin at 10 AM EST (UTC -5) and will feature panelists from the private sectors as well as government agencies. At nearly the same time, the CFTC’s Technology Advisory Committee will discuss, “Blockchain and the Potential Application of Distributed Ledger Technology to the Derivatives Markets.” After this 45 minute panel, they will then discuss, “Market and Regulatory Developments with Virtual Currencies and Related Futures Products.” We anticipate the CFTC sessions will focus on cryptocurrencies, the potential of distributed ledger technology (e.g., Blockchain), and what future products based on them will look like. Likewise, we anticipate that the Congressional subcommittees will discuss potential uses of blockchain in the federal government. Quotes from Congress members regarding the upcoming meeting are positive. From Congressman Randy Hultgren (R.-IL), “Blockchain has a number of applications that can increase security, better serve consumers and bring efficiency to government processes.” “We imagine that there will be many new applications for blockchain technology as businesses experiment and perfect new uses, many of which could also be used by the federal government, from protecting Americans’ sensitive information on government systems to supply chain risk management,” said Brandon VerVelde, a spokesperson for the Committee on Science, Space and Technology. We anticipate these meetings could result in good optics for cryptocurrencies and further evidence that the U.S. Government wants to work with crypto and not against it. How that translates to the market is yet to be seen. Some speculation is being made that this will specifically boot ETH prices, but we believe a rising tide raises all ships.   Watch our video on why you should move your crypto off exchanges here:

Yesterday we opened a position in Nano ($NANO) and were stopped out earlier today. We have reopened our position as we anticipate many positive things for this currency now that it has had several successive negative pieces of news. We will continue to place strict stops on it as we would like to enter this position at or near the support levels currently being established. Nano is a play on very fast, fee-free transactions which we have seen to be in-demand in early 2018. However, it will need to develop more functionality to be seen as more than a “one-trick pony”. Their updated roadmap will likely be released in the coming weeks along with new wallets.

We have re-entered OriginTrail ($TRAC) as we felt it was too good of a proposition to pass up. TRAC is a protocol which is meant to be a turnkey solution for supply chain management using the benefits of a blockchain. This has a massive market and we believe there is certainly a use case congruent to how we see Waltonchain ($WTC) playing out. Similar to TRAC and WTC, WaBi ($WABI) was just featured on CNET. We’ve been following WaBi’s ICO and development since November, so it’s very positive to see them receive mainstream recognition.

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:  

StopTheFakes

For flipping Neutral.

For long-term holding Good. A unique idea with a compelling mission.

What is it? 

A user-friendly and affordable Blockchain service for everyone to trace and record cases of illegal use of logos, trademarks or any other intellectual property and to take immediate action to redress the infraction!

What is our verdict? 

What we like: Product will soon be available, good use case

What we don’t like: Potential scaling issues, centralized closed system, very little original tech

  • Starts in 35 days
    Token
    STF
    PreICO Price
    1 ETH = 2,400 STF
    Price
    1 ETH = 2,400 STF
    Bonus
    Available
    Bounty
    Platform
    Ethereum
    Accepting
    ETH, BTC
    Minimum investment
    0.1 ETH, 0.01 BTC
    Soft cap
    675,000 USD
    Hard cap
    8,500,000 USD
    Country
    Czech Republic
    Whitelist/KYC
    KYC & Whitelist
    Restricted areas
    USA, Belize

Website: https://www.stopthefakes.io/

Whitepaper: https://www.stopthefakes.io/docs/WP_En.pdf

Technical Analysis Research

Markets are boring right now! After all of the excitement of 2017, the beginning to the crypto market of 2018 has been a snoozer. I don’t think that this will last, however, but in the meantime we can sharpen our collective saw..

In today’s newsletter, I cover a very simple but powerful method of setting up shorter-timeframe swing trades in a choppy market that’s range-bound. Moving down in timeframe will yield a completely different-looking chart. While you can use any particular technique that you want to for harvesting short-term profits, I would caution you to keep it as simple as possible and keep position sizes very small for now until you build something worth scaling up.

In tomorrow’s edition, I’ll cover some of the more mechanical aspects of trading this since the crypto market isn’t exactly that efficient at trading in and out of assets.

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. If you go to buy the course at our online “store” you can receive $10 off the $59 street price with your member’s “coupon code” of member18crypto…or you can simply use the link above but that does not offer paypal.

 

A question came into me today, “should you chart against USD or BTC?” I know that there are some religious wars that break out on this topic in deeper places like reddit, so I’ll avoid those and just give you my take on it.

I am most interested in the performance of the coin in question, so therefore I want to reduce the number of variables and just chart it against the USD (or any other stable fiat currency, for that matter). Now, the USD can move around a little bit but nowhere as much as BTC does when it’s on a tear. In that case I then have two independent variables to chart and it makes my brain hurt to figure out what is happening. If BTC moves way up and my coin does not do the same, then the chart actually drops. For those that are trying to invest based on the arbitrage against BTC, then perhaps this is a good standard for you to stick with. Myself, I want to know how the coin stands alone, against a relatively fixed variable.

 

 

I am doing the majority of my Technical Analysis work on TradingView and Coinigy, and I have a BitFinex app on both my iPad and Android smartphone. All of these charting platforms call a TradingView API. TradingView is the 800 lb. gorilla in the Crypto charting space until the “established” players want to make a go at Crypto, like Ninjatrader, Tradestation, eSignal, Sierra charts, etc. My sense is that TradingView has such a head start that it will be very difficult for the big boys to make a dent in this space for a while. Until that point, TradingView has almost a monopoly in this space. If you have a particular tool that you think is superior, please let me know. You can access the BitFinex and TradingView platforms for free, however there are some paid features that you might want to consider depending on your needs, such as expanded watchlists, different study sets, account alerts, etc. 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.

 

 

 

 

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