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XTZ Performs Best (+73.77%); ADA Offers More Than Its Peers

By | Coinscious Lab, Data Analytics, Market Report | No Comments
Biggest
30d % Gain

Tezos (XTZ) 
+73.77%

Biggest 30d %
Gain (Sector)

Digital Content
+23.22%

Biggest
30d % Loss

Pundi X (NPXS) 
-16.06%

Smallest 30d %
Loss (Sector)

Stablecoins
-0.00%

Overview

Released bi-weekly, this report aims to identify broad trends in the cryptocurrency market. In order to reflect the latest developments in this fast-paced and volatile market, the reports plan to focus on metrics derived from a 30-day rolling window of data, this time from February 28, 2019 to March 28, 2019.

Our universe of analysis includes 50 of some of the most widely used and traded cryptocurrencies, and groups them into sectors that reflect similar utility and valuation models. Through analysis of the recent historical performance of individual cryptocurrencies as well as their sectors, we provide a framework for analysis where investors can identify outperforming cryptocurrencies or sectors by comparing their performance relative to peers.

Sector
Constituent Coins/Tokens
Digital Cash BTC, BCH, BSV, LTC, BTG, DOGE, DCR, BCD, DGB
Privacycoins XMR, DASH, ZEC, XVG, BCN
DApp Platforms ETH, EOS, ADA, NEO, ETC, XEM, XTZ, QTUM, LSK, AE, ZIL, ICX, BTM, ETP
Resources SC, GNT
Payments and Settlements XRP, XLM, OMG, NPXS, MKR, PPT
Decentralized Exchanges BTS, ZRX, WAVES
Digital Content TRX, ONT, BAT, STEEM
Data and Information IOTA, VET, LINK, REP
Stablecoin USDT, TUSD, DAI

Analysis

The performance of major cryptocurrencies over the past month has been good, with 45 out of the 50  cryptocurrencies that we examined up from their values 30 days ago. Bitcoin (BTC), the largest cryptocurrency by market cap, is trading around $4100, still in the sideways trend that began in November last year. However, it is also up 5.00% compared to 30 days ago.

Outside of cryptocurrencies, the S&P 500 has been relatively flat, only up 1.11% from 30 days ago and closing yesterday at $2815.44.

Figure 1 presents the risk versus return trade-off over the past 30 days by plotting mean daily return versus historical daily volatility for various cryptocurrencies.   

Figure 1. Plot of mean daily return against historical daily volatility for individual cryptocurrencies from February 28, 2019 to March 28, 2019. Higher returns at a given level of risk, measured through historical daily volatility, indicates a better investment.

The best performer overall over the past month was Tezos (XTZ), with a total return of 73.77%. Tezos is a self-amending proof-of-work dApp platform that removes the need to hard fork when implementing protocol amendments.

Stakeholders vote for their preferred proposed protocol amendments through a formal and systematic process that has four discrete periods: the Proposal Period, the Exploration or “Testing” Vote Period, the Testing Period, and the Promotion Vote Period. The Tezos community successfully concluded the first round of voting, the Proposal Period, on March 20 and are currently in the Exploration period, casting votes to decide whether the winning proposal will move on to be deployed to the test network.

This news is significant because it is the first time that the self-amending upgrade process has been put into action. According to ​Tezos​, removing the need to hard fork in order to make protocol amendments is an important because “the suggestion or expectation of a fork can divide the community, alter stakeholder incentives, and disrupt the network effects that are formed over time. Because of self-amendment, coordination and execution costs for protocol upgrades are reduced and future innovations can be seamlessly implemented.” ​Tezos’ price went up in the days leading up to the end of the first voting period, so it is possible that growing enthusiasm and positive news about the protocol upgrade was the underlying cause. The success of the first vote also likely caused the subsequent 31% jump on March 20.

The second and third best performing cryptocurrencies were Cardano (ADA) and Basic Attention Token (BAT) with total returns of 55.14% and 39.56% respectively. Cardano is noteworthy in that it offered higher returns than its peers with similar levels of risk, including several other dApp platforms. 

Pundi X (NPXS) was the worst performing cryptocurrency, with total losses of 16.06%.

Figure 2a. Cryptocurrencies with the highest total returns from February 28, 2019 to March 28, 2019.

Figure 2b. Cryptocurrencies with the lowest total returns from February 28, 2019 to March 28, 2019.

Figure 3 shows various performance measures of the nine sectors as well as that of the S&P 500 for comparison and Figure 4 plots the performance over time of each sector. Performance between the sectors was all positive, except for stablecoins with a very small negative return. Total returns ranged from 0.00% (stablecoins) to 23.22% (digital content).

Figure 3. Mean daily returns, historical daily volatility, total returns, maximum drawdown, and ex-post Sharpe ratio for each sector from February 28, 2019 to March 28, 2019. Smaller maximum drawdowns and more positive Sharpe ratios are more desirable. The Sharpe ratio is calculated with the 10 year US Treasury bill rate as the annual risk-free rate.

Figure 4a. Price performance over time of sectors that had positive total returns between February 28, 2019 to March 28, 2019.

Figure 4b. Price performance over time of sectors that had negative total return between February 28, 2019 to March 28, 2019.

Figure 5 shows the correlation between the daily returns of each sector. The S&P 500 had little correlation with most cryptocurrency sectors except for stablecoins, which it had a 0.31 correlation with. Resources, consisting of Siacoin (SC) and Golem (GNT), was the least correlated with the others. Correlations between sectors were more varied and less highly positively correlated than observed in previous months.

Figure 5. Correlation between daily returns of each sector from February 28, 2019 to March 28, 2019. Correlation ranges between -1 and 1. Correlation close to 1 indicates a more positive relationship between the pair of cryptocurrency returns and correlation close to -1 indicates a more negative linear relationship. Correlation close to 0 indicates no linear relationship.

APPENDIX A: Methodology

The daily price data of cryptocurrencies in USD at 4:00 PM EST from February 28, 2019 to March 28, 2019 was used for our calculations.

The prices are the volume weighted average price of the cryptocurrency in USD at 4:00 PM EST each day across all exchanges where Coinscious has data.

To analyze performance by sector, the prices of constituent cryptocurrencies was normalized by dividing by the price on February 28, 2019, then averaged. When calculating the daily returns using this averaged normalized price, it is equivalent to if each sector was represented as an equally weighted portfolio of its constituent cryptocurrencies formed starting February 28, 2019 and the daily returns of the portfolio were calculated. Returns used throughout this report refer to simple returns.

Daily closing price data of the S&P 500 index from Yahoo Finance was also used as a proxy to represent the US equity market. The latest 10 year US Treasury bill rate from YCharts was used for calculations involving a risk-free rate.

In subsequent reports, we may update our universe, sectors, methodology, and analysis to reflect new developments.

APPENDIX B: Terminology

  • Volatility: A measure of the dispersion in the trading price of an instrument over a certain period of time, defined as the standard deviation of an instrument’s returns.
  • Drawdown: A measure of the decline of the trading price of an instrument or investment since the previous peak during a certain period of time. Less negative, less frequent, and shorter drawdowns are more desirable.
  • Maximum drawdown: The maximum peak to trough decline of the trading price of an instrument or investment over a certain period of time. Less negative maximum drawdowns are more desirable.
  • Sharpe ratio: A risk adjusted measure of return that describes the reward per unit of risk. The reward is the average excess returns of an investment against a benchmark or risk-free rate of return, and the risk is the standard deviation of the excess returns. A higher Sharpe ratio is better. Ex-ante Sharpe ratio is calculated with expected returns whereas ex-post Sharpe ratio is calculated with realized historical returns.
  • Correlation: A measure of the linear relationship between two series of random variables, which in the context of finance, can be two series of returns. Correlation ranges between -1 and 1. Correlation close to 1 indicates a more positive relationship between the pair of cryptocurrency returns and correlation close to -1 indicates a more negative linear relationship. Correlation close to 0 indicates no linear relationship.

Disclaimer

The information contained herein is for informational purposes only and is not intended as a research report or investment advice. It should not be construed as Coinscious recommending investment in cryptocurrencies or other products or services, or as a solicitation to buy or sell any security or engage in a particular investment strategy. Investment in the crypto market entails substantial risk. Before acting on any information, you should consider whether it is suitable for your particular circumstances and consult all available material, and, if necessary, seek professional advice.

Coinscious and its partners, directors, shareholders and employees may have a position in entities referred to herein or may make purchases and/or sales from time to time, or they may act, or may have acted in the past, as an advisor to certain companies mentioned herein and may receive, or may have received, a remuneration for their services from those companies.

Neither Coinscious or its partners, directors, shareholders or employees shall be liable for any damage, expense or other loss that you may incur out of reliance on any information contained in this report.

Crypto Exchanges: Make It Or Break It

By | News | No Comments

? Ripple Partners with $19 Billion Bank

FRIDAY, MARCH 29, 2019

Ripple Inc., has partnered with India-based commercial bank, Federal Bank to offer blockchain solutions for cross-border remittances. At the moment, it’s unclear whether cryptocurrency will be directly related as fiat to crypto trading is illegal in India. Federal Bank is estimated to be worth $19 billion dollars with access to 8 million customers. 

SOURCE: ETHEREUMWORLDNEWS


? FINMA Affirms Envion AG’s ICO Was Unlawful

FRIDAY, MARCH 29, 2019

Switzerland’s Financial Market Supervisory Authority (FINMA), has found Envion AG‘s ICO launch last July 2018 to be illegal. In their official report, it was discovered that the company accepted funds – in the form of bitcoin, ethereum, and USD – from over 37,000 investors and amounted to over 90 million francs.  

Envion was pitched as decentralized, clean energy for mobile mining units. EVN tokens were issued on cryptocurrency exchanges to its investors. The company has since been taken over by the Swiss Cantonal Court of Zug Switzerland, dissolved and ordered to be liquidated.

SOURCE: BITCOINIST


? CEDEX Secures $50M Worth of Diamonds for ETF

THURSDAY, MARCH 28, 2019

CEDEX, a blockchain-based trading platform, has secured over 6,000 diamonds, worth $50 million dollars, for the launch of its diamond exchange-traded fund (ETF). The platform uses blockchain technology and a proprietary algorithm that allows diamonds to become a tradable asset class like gold, overcoming challenges such as lack of transparency, liquidity and fungibility.

SOURCE: COINDESK


⚡ Zebpay Launches Bitcoin Lightning Network Integration

THURSDAY, MARCH 28, 2019

Zebpay, a Malta-based cryptocurrency exchange, will be the first platform to enable Lightning Network payments for its bitcoin users. Customers worldwide can use their BTC wallet balances through web, iOS, and Android apps to make Lightning transactions. 

SOURCE: DAILYHODL


? Kraken Enforces 2FA and Launches Security Lab

WEDNESDAY, MARCH 27, 2019

U.S. cryptocurrency exchange, Kraken, ramps up its security by making two-factor authentication (2FA) mandatory for users. Currently, the two supported options for 2FA are Google Authenticator and YubiKey.

In their official blog post, Chief Security Officer, Nick Percoco, also announced the formation of Kraken Security Labs. The team will be dedicated to enhancing security of their environments and products. 

SOURCE: COINTELEGRAPH


? Trustology Launches iPhone Crypto Wallet

WEDNESDAY, MARCH 27, 2019

TrustVault, by Trustology, is now available for download from the Apple UK app store. The new iPhone cryptocurrency vault currently only supports ether but bitcoin and ERC-20 tokens will be added soon.

Unlike current typical cold wallets, it boasts a combination of hardware security modules (HSMs) with verification processes distributed among individuals at secure data centres. Users will be able to access funds within a matter of seconds. 

Trustology was founded by a team of technologists that previously worked at financial institutions including BNY Mellon, RBS, and Barclays. The company closed a seed round of $8 million last year. 

SOURCE: COINDESK


⚡ Huobi’s US Arm To Launch Lending, OTC Trading & Stablecoin

WEDNESDAY, MARCH 27, 2019

Huobi Global’s U.S branch, HBUS, is organizing a new team headed by Katelyn Mew to develop solutions for its institutional investors. They will be focusing their time and resources creating services such as token lending, over-the-counter trading, and potential issuance of a Huobi stablecoin. 

SOURCE: COINTELEGRAPH


? DragonEx Crypto Exchange Has Been Hacked

TUESDAY, MARCH 26, 2019

Singapore cryptocurrency exchange, DragonEx, notified its users via Telegram that it suffered a hack. The cyberattack took place on Sunday, March 24 and resulted in theft from users and platform crypto assets. The crypto exchange administrator provided an update identifying 20 wallet addresses to where the stolen assets were transferred to: here

SOURCE: COINTELEGRAPH


? Rakuten Granted License for New Crypto Exchange

TUESDAY, MARCH 26, 2019

Japanese e-commerce giant, Rakuten, has received licenses for its relaunched cryptocurrency exchange, Rakuten Wallet. The license was issued by the country’s Financial Service Agency (FSA), registering it as a virtual currency exchange service provider. Users can sign up for the new service on March 30, 2019

SOURCE: COINDESK


?? Yahoo!-Backed Crypto Exchange to Launch May

TUESDAY, MARCH 26, 2019

Japanese cryptocurrency exchange, Taotao – formerly known as BitARG – is set to launch this May. Taotao is currently 40% owned by a subsidiary of Yahoo! Japan. Taotao will launch two cryptocurrencies on its platform: bitcoin and ethereum. Users will be able to leverage margin positions for ripple, bitcoin cash and litecoin. 

SOURCE: CRYPTOGLOBE


⛓ OKEx Launches New Blockchain Platform & DEX

MONDAY, MARCH 25, 2019

Cryptocurrency exchange, OKEx, announced its latest projects including its new blockchain, OKChain, and decentralized platform, OKDEx.

OKChain is currently in its final stages of development and the testnet is set to launch June 2019. OKEx’s OKB token will start on the ERC-20 blockchain and migrate to the mainnet once it becomes ready. 700 million OKB tokens will be delayed for release between 2020 to 2022.

SOURCE: BITCOINEXCHANGE


? Seed CX Partners with Hydra X To Expand To Asia

MONDAY, MARCH 25, 2019

United States cryptocurrency exchange, Seed CX, has partnered with Hydra X, a Singapore-based FinTech firm, to offer its services in Asia. The integration of Seed CX’s exchange platform with Hydra X’s trading platform, Sigma, will allow users to view prices, trade and monitor their portfolio, as well as gain access to a fiat-cryptocurrency gateway. 

SOURCE: BLOCKTRIBUNE


? eToro Lists Tron

MONDAY, MARCH 25, 2019

eToro, the United Kingdom social trading platform, announced its listing for  Tron (TRX). This announcement comes after the company revealed it is offering its trading service in the United States. The platform currently lists 13 cryptocurrency assets including bitcoin (BTC), ethereum (ETH), ripple (XRP), litecoin (LTC), bitcoin cash (BCH), and stellar (XLM).

SOURCE: COINTELEGRAPH


?  Blockchain Watch: Whale, Hello There

FRIDAY, MARCH 29, 2019
THURSDAY, MARCH 28, 2019
WEDNESDAY, MARCH 27, 2019
TUESDAY, MARCH 26, 2019
MONDAY, MARCH 25, 2019

SOURCE: TWITTER


Images courtesy of Shutterstock

Cryptocurrency Triumphs & Troubles

By | News | No Comments

? U.S. Authorities Charge Leaders of ‘OneCoin’

FRIDAY, MARCH 8, 2019

United States prosecutors announced criminal charges against leaders behind OneCoin, a multibillion-dollar cryptocurrency pyramid scheme. Konstantin Ignatov, Ruja Ignatova, and Mark Scott were charged by the Southern District of New York for wire fraud, securities fraud and money laundering. An estimated $1.2 billion of investor money was laundered to at least 21 countries

SOURCE: NASDAQ


⏸  Fidelity May Delay Support for Ethereum

FRIDAY, MARCH 8, 2019

Fidelity Digital Assets (FDAS) advises support for ethereum (ETH) may be delayed due to the latest hard fork upgrades. FDAS quietly launched this quarter and is a new company created by investing giant, Fidelity Investments. FDAS president, Tom Jessop, says they want ether and other cryptocurrencies to be available but the process it’s easy. Bitcoin (BTC) is currently the only digital asset supported on the platform.

SOURCE: COINDESK


?? South Korea Establishes Task Force To Fight Crypto Fraud

FRIDAY, MARCH 8, 2019

South Korean’s Supreme Prosecutors’ Office(SPO) has created a new task force to protect consumers from fraud, crimes, money laundering, and other suspicious activities related to digital currencies. Cryptocurrency related crimes in the country have risen from 53 in 2016 to 4,500 in 2018. 

SOURCE: COINGEEK


⚙️ OKEx Lists Tron On C2C Market

THURSDAY, MARCH 7, 2019

Cryptocurrency exchange, OKEx, adds Tron (TRX) to its customer-to-customer (C2C) trading platform. The decentralized C2C platform allows users to trade assets directly with one another. In addition, users can place orders with self-selected exchange rates and pay using cryptocurrency or support fiat currencies.

SOURCE: COINGAPE


? eToro Launches Trading Platform & Wallet in the U.S.

THURSDAY, MARCH 7, 2019

eToro, the social investing and trading platform, officially announces the launch of  its fiat-to-crypto platform in the United States. The platform is already available in 140 countries worldwide and will now operate in 30 states and 2 territories in the US. Users will be able to use popular like CopyTrader to follow trading habits of individuals with a proven track record. eToro’s multi-signature wallet provide multi-coin support such as BTC, ETH, LTC, BCH, XRP and XLM

SOURCE: NEWSBTC


? SIX Teams Up With R3 Corda For New Digital Asset Exchange

THURSDAY, MARCH 7, 2019

The Swiss stock exchange, SIX, selects R3 Corda to provide its ucoming blockchain-based platform. It will use R3’s Corda Enterprise to power the Six Digital Exchange (SDX) platform to allow the issuing and trading digital assets, as well as tokenization of securities and non-bankable assets. 

SOURCE: FINEXTRA


? Coinbase Clarifies It Never Shared “Personally Identifiable” Customer Data

WEDNESDAY, MARCH 6, 2019

Coinbase is still in the hot seat since its acquisition of blockchain analytics firm, Neutrino. Tensions raised last Friday when Christine Sandler stated that the exchange’s previous analytics provider was “selling client data to outside sources” in her interview with Cheddar. A spokesperson from Coinbase has now advised Sandler misspoke and clarified the exchange never shared “personally identifiable information with any third-party blockchain analysis vendors.”

SOURCE: COINDESK


? Ripple Launches On Huobi’s OTC Platform

WEDNESDAY, MARCH 6, 2019

Cryptocurrency exchange, Huobi, now supports Ripple (XRP) on to its over-the-counter (OTC) platform which currently lists assets such as bitcoin, ethereum, tether, EOS, and Huobi Token. Huobi OTC aims to bridge the gap between fiat and digital assets, serving as an escrow for its users.

SOURCE: COINTELEGRAPH


? Swiss Stock Exchange Launches Ethereum ETP

WEDNESDAY, MARCH 6, 2019

Swiss’ SIX stock exchange launches its first ethereum-based exchange traded product (ETP) under the ticker AETH. Ethereum ETP, backed by startup Amun AG, is the second cryptocurrency-based ETP to be made available, with bitcoin ETP being the first. SIX plans to list a total of five crypto-based ETP’s which will also include ripple, bitcoin cash and litecoin. These collectively make up the Amun Crypto Basket Index  (HODL5).

SOURCES: BITCOIN.COM


? MakerDAO Holds Vote on Fee Hike for DAI

UPDATE: FRIDAY, MARCH 8, 2019

Votes are in! Users and holders of DAI in favour of increasing the DAI stability fee from 1.5% and 3.5%.

SOURCE: CRYPTOGLOBE

TUESDAY, MARCH 5, 2019

MakerDAO is asking token holders of ethereum-backed stablecoin, DAI, to vote on whether to go forth with the proposed increase in stability fees from 1.5% to 3.5%. MakerDAO’s founder, Rune Christensen, states the rationale behind the fee hike is because DAI’s dollar-peg is “almost at a breaking point”. Token holders can cast their votes here.

SOURCE: COINDESK


⚖️ Quadriga Gets 45-Day Extension from Court

TUESDAY, MARCH 5, 2019

The Canadian court has granted troubled crypto exchange, QuadrigaCX, a 45-day extension to allow for the continued search of $140 million worth of missing cryptocurrency. In addition, the court has appointed Peter Wedlake, a retired partner and senior vice president of audit firm Grant Thorton, to be the chief restructuring officer (CRO). The court has also ordered Amazon Web Services to overturn any data on the Quadriga platform originally created by Gerald Cotten, the former CEO.

SOURCE: COINDESK


☑️ Tron (TRX) Partners With Tether (USDT)

MONDAY, MARCH 4, 2019

Tron Foundation officially announces their newest partnership with Tether. The partnership will bring Tether’s USDT coin onto the TRON network by the end of Q2 2019, and allow the issuance of a TRC20-based USDT. This marks the first major cryptocurrency crossover and will allow TRX and Tether users to transact on the TRON network with access to a price-stable asset.

SOURCE: ETHEREUMWORLDNEWS


? Blockchain Watch: Hello Goodbye

FRIDAY, MARCH 8, 2019

Bitcoin whales moved a total of 9820 BTC, worth $38.4 million dollars.

THURSDAY, MARCH 7, 2019
WEDNESDAY, MARCH 6, 2019
TUESDAY, MARCH 5, 2019
MONDAY, MARCH 4, 2019

Bitcoin (BTC) and Stellar whales start off the week strong.

SUNDAY, MARCH 3, 2019

Ethereum whales are on the go, moving a total of 174, 450 ETH, worth $22.1 million dollars.

SOURCE: TWITTER


Images courtesy of Shutterstock