Crypto Update: Invaluable

Crypto Market Update 05.21.18

If your customers had to stop using your product or service tomorrow, how much would they miss it?

From How cold is the turkey? by Seth Godin

Crypto Market Update

Our weekly crypto market update uses a standard set of information sources.

Crypto Indexes

The Bletchley Indexes “offer the most thoughtful and consistent approach to index construction” according to CoinMetrics. 

Original “top X” indexes were launched in June 2017, followed by a market-wide index in December 2017 and sector specific indexes in February 2018. In total, there are 13 Bletchley indexes, with charts over various timetables available for each on their site.

Below is an alternate view of the performance based on the downloadable data made available by Bletchley. This view is intended to give a side-by-side snapshot of a handful of indexes.

crypto index performance 05.21.2018

Obserservations

  • Bletchley 10 and Total Market down over slightly vs BTC and 5-10% vs USD
  • Both Bletchley 10 and Total Market index remain up over ~20% over last 30 days
  • Even Indexes performed worse than weighted indexes over last 7 and remain better over longer periods
  • Platform, Application, and Currency indexes all down against USD and BTC over last week
  • Currency down nearly 10% vs USD over last 7 days and over 22% in last 3 months

Global Crypto Charts

For a quick look at the global markets from another perspective, Coinlib.io provides simple charts with a lot of info, including Bitcoin marketshare, a visualization of the top 20 currencies by volume and market cap, and more.

Total Market Cap of Cryptocurrencies: $379.72 billion

total crypto market cap 05.18.2018

Market Share of Top Cryptocurrencies

Market Share of Top 5 Cryptocurrencies - 05-21-18 Bitcoin’s market share remains at~36%, close to all-time lows. This continues a long-term declining trend, with new currencies such as EOS and BCH taking some of that market share.

Market share of top 20 cryptocurrencies

Market Share of Top 20 Cryptocurrencies - 05-21-18

The top 20 currencies (by market cap) currently make up roughly 86% of the total crypto market share.

TradingView Technical Indicators

Based on data and info from TradingView (Click  for 30% off a pro subscription)

Crypto Performace 05.21.2018

Scores based on the cumulative total of positive and negative technical indicators signals over three time horizons on Trading View. Scores are weighted by multiplying total as follows: daily (x 1) weekly (x 2), and monthly (x 3). 

  • BTC and ETH have turned much more negative vs USD since last week
  • ETH is looking worse vs BTC than the last two weeks

CRYPTO PERFORMANCE

Crypto Performace 05.21.2018

  • BTC down over 6% vs USD over last week and nearly 30% over last 3 months
  • ETH has outperformed BTC significantly in last year

Google Trends

Google Trends Bitcoin + Crypto 05-21-2018.png

Google Trends have mostly flattened out after falling significantly in February.

I’m tempted to stop tracking this, as  I believe there will be fewer searches as the public gains knowledge. However, significant price action could still lead to search volume surges.

WooBull Charts

Google Trends Bitcoin + Crypto 05-21-2018.png

NVT RatioThis long-term cycle tracking ratio has mostly continued a downward trend, although a slight uptick in the past few days. Regardless, the ratio is quite high and suggests a further downturn is due.

Bitcoin NVT Signal Chart 05.21.2018

NVT Signal -This short-term signal has moved down slightly over the past week from 126 to 122. It appears to be breaking a support trend, suggesting bearish price movement in the short term.

In the original post introducing NVT Signal, 150 was indicated as an overbought signal.

 

CoinMetrics Charts

CoinMetrics has provides great charting tools for a number of top cryptocurrencies. Kalvichkin’s NVT is a regular check for checking short term trading signals. 

Kalvichkin's NVT - BTC ETH 05.21.2018

Kalvichkin’s NVT – Similar to NVT Signal, Kalvichikin’s NVT has remained mostly flat compared to last week. ETH has moved higher.

Articles of Note

Crypto’s Big Lie

Parker Thompson writes that crypto does not make venture capital style investing available to anyone, as is often stated.

Setting aside the fact that investing is not independent of wealth (you need money to invest), these markets are opaque, controlled by insiders, and by the time “anyone in the world” has the opportunity to invest, the price is often an order of magnitude or three higher than the price paid by venture capitalists (first in line), and significantly higher than what accredited investors paid in pre-sales (second in line).

And you hear it in private conversations with crypto teams as well. To paraphrase one statement (but not much), “we are letting value-add VCs buy equity in the company, and pushing the dumb money that got rich on bitcoin into the public sale.” When money is abundant, who it is attached to matters even more, and money has never been as abundant in traditional venture as it is in crypto.

Why Crypto’s A Growing Threat To FAMGA (a.k.a. Facebook, Apple, Microsoft, Google and Amazon)

Lou Kerner believes crypto is a real threat to the ever-growing massive tech companies.

The point of my post last year, was that FAMGA’s increasing domination has profound implications, including the stifling of innovation that results from the MAJORITY of value creation going to just five companies.

A year ago I didn’t see any emerging technology that could impede the FAMGA’s increasing dominance. But I did state that “History has taught us that nothing is constant but change”, as noted by the great graph below showing the market cap market share of the top 100 tech companies over time:

Consensus & Token Summit Recap

Last week was crypto week in New York with mulitiple conferences and events. Patrick Mayr  from Token Economy provided a good summary, including a bit about the revenue from ticket sales alone.

Consensus (May 14–16, 2018)

Raking in approximately $17million in ticket sales alone, Consensus provided a glimpse into lucrative ripple effects of the technology: event planning with unprecedented top line.

An analysis of batching in Bitcoin
 As a way to avoid ridiculous fees, batching has been implemented to reduce transaction volume. CoinMetrics looked at the result and found impressive results.

Today, around 12% of all transactions on the Bitcoin network are batched, and these account for about 40% of all outputs and between 30–60% of all transactional value. The fact such that a small set of transactions carries so much economic weight makes us hopeful that Bitcoin still has a lot of room to scale on the base layer, especially if usage trends continue.

Introduction TxTenna: Decentralizing the Last Mile in BitCoin

In Token Economy #49: Crypto Extravaganza, a new project is mentioned which allows offline bitcoin transactions. This could be huge for making BTC viable for a many more people.

Bitcoin is unstoppable, but only to a point: its single point of failure is actually physical, as the network still relies on ISPs for internet connectivity. These are centralized communication networks with a history of censorship (imposed by governments, see the whole net neutrality situation), attacks or fragility (natural or manmade disasters).

So the folks at Samurai Wallet, using the GoTenna SDK, a toolkit provided for free by GoTenna (the makers of an off-grid mobile mesh networking platform) have developed the TxTenna app. The app can broadcast offline bitcoin transactions off-grid via goTenna Mesh devices, effectively enabling an alternative physical communication layer for bitcoin. This is how it works:

Using the Samourai Wallet app the user creates a standard bitcoin transaction and signs it. This is possible while offline and without wifi or mobile access.The Samourai Wallet app then passes the offline transaction to the TxTenna App and TxTenna broadcasts it to nearby mesh nodes via a paired goTenna mesh device. Other goTenna devices in the area relay the transaction until an internet connected goTenna node also running TxTenna receives it and forwards it to the Bitcoin network.”

Final Thoughts

Bitcoin and the crypto markets more widely look susceptible to a short term price drop. Long term, there are are still many positive signs.

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