Bitcoin’s NVT (network value/transaction) has been moving in a general upward trend since bottoming on Feb 6th. Here’s a chart using the great charting tools at coinmetrics.io:
Likewise, Willy Woo’s NVT Signal chart shows a similar pattern:
$BTC NVT is trending upwards after bottoming Feb 6. See chart from @coinmetrics. NVT Signal chart from @Woonomic shows similar pattern. #bitcoin
Earlier this year, Store of Value published a few predictions on the cryptocurrencies to rise in 2018. They start off with a bold one:
Ethereum will overtake Bitcoin by the end of 2018 and QTUM will be a top 5 cryptocurrency. There are some incredible things brewing for both and I don’t believe the market has fully realized nor appreciated what’s going on. Ethereum has the largest user and developer base in the West. QTUM has gained a strong foothold in the East.
These predictions aren’t made off the cuff; each is backed by an reasonable argument. For example, QTUM can benefit from both BTH and ETH “winning”:
Ethereum ecosystem wins = QTUM ecosystem wins
Because QTUM uses the EVM, any projects building on Ethereum can be easily ported to QTUM. A corollary to this is that any successful dApp or protocol on Ethereum can easily become a successful dApp or protocol on QTUM. QTUM doesn’t need to compete with Ethereum for its developer ecosystem, it shares Etheruem’s developer ecosystem. There are many amazing up-and-coming projects for Ethereum such as 0x and Augur and I can envision a world where QTUM has its own 0x’s and Augurs.
Bitcoin ecosystem wins = QTUM ecosystem wins
Because QTUM uses a Bitcoin-based UTXO blockchain as its settlement layer, QTUM can take advantage of any upgrades to Bitcoin. Here’s a few examples: QTUM is already using SegWit and is primed to deploy its own version of Lightning. Once deployed, QTUM is essentially Ethereum with Lightning. How cool is that? It’d be even better for QTUM if Lightning turns out to be a massive success.
Read the full post at Why 2018 Will Be The Year Of Ethereum And QTUM at Store of Value.
There’s a possibility that some big winners come out of the crypto projects. Sure, most are junk but like the tech boom, a few big winners may emerge. There’s a lot debate about how to value crypto assets. Most of that pertains to assets that are being used as intended now.
With many projects either not yet active, or still in the very early stages, any valuation based on data or metrics seems unlikely to be accurate. Investments need to be longterm, as Jeremy Epstein writes in How do you value crypto-assets? at Never Stop Marketing
if you are serious about profiting from this long term trend towards blockchain-based ownership of assets that will have value within decentralized networks, then the smart move is to ignore the short-term crypto mania and use this time to go as deep as you can on the fundamentals.
Do what you can to understand HOW a crypto-network is put together and how it will work. If you are about to make an investment, find someone who has really done his or her homework.
As an example of someone that’s done their homework, he cites the Store of Value blog.
From well-known crypto investor Woobull, a post on a trading signal for Bitcoin, as first derived by Dmitry Kalichki.
What is NVT Signal?
Standard NVT Ratio is simply the Network Valuation divided by the Transaction Value flowing through the blockchain and then smoothed using a moving average. What Dimitry did was to apply the moving average just to the volatile Transactions component only without smoothing the already stable Network Valuation component.
This produces a much more responsive chart. Responsive enough to use as a trading indicator.
This is probably the first trading indicator to use blockchain data instead of the basic price and volume data coming in from exchanges.
The NVT Signal is picking we’ve bottomed.
This is available on Woobull Charts for now, though a new project named Fomonomics is mentioned.
via NVT Signal, a new trading indicator to pick tops and bottoms at Woobull
Another tool (in beta) for better managing money on your own, Prism lets you setup an index on your own. From the post How Blockchains Will Disrupt Mutual Funds…You Build Your Own at Never Stop Marketing:
Prism is the world’s first trustless platform for creating portfolios of assets.
Designed and built by ShapeShift, Prism uses smart contracts deployed on the Ethereum network to bring custom portfolio management to everyone.
You can create and rebalance your own portfolio, as well as browse the public portfolios of others and follow them.
So that is exactly what I did.
Now, my one issue with the site (at the moment) is the relative limited number of coins that it supports. I had hoped to create a broader index of coins, but there are only about 25 or so coins (if you have ever used ShapeShift, you will see the exact same coins).
Noah Smith makes the case for Bitcoin as a new gold. The problem recently has been that it hasn’t held value well. Perhaps there’s a future where it’s used more in transactions, once fees are decreased, giving it a resurgence in a new manner.
There are essentially three reasons Bitcoin isn’t working out as a currency — twotechnological, and one economic. Technologically, Bitcoin tends to be slow and laborious to use because it verifies transactions in small blocks. That problem isn’t particularly hard to overcome — just use bigger blocks, or use a form of temporary credit to ease the burden on the network. More ominously, Bitcoin relies on people known as miners to verify all transactions, and compensates them by creating new Bitcoins. But soon, this will stop, since the total number of Bitcoins is capped at 21 million — at that point, transaction fees will be needed to pay miners.
It’s very possible that all of these technological problems will be overcome, either by Bitcoin or by rival cryptocurrencies. Lots of smart people are working feverishly on solutions. But there’s also an economic reason why Bitcoin and other cryptocurrencies will never be useful as money. Things that are good financial investments don’t make good currencies, and vice versa.
via Bitcoin Is the New Gold at Bloomberg.com
Jeremy Epstein looks at how Amazon is integrating advertising into their streaming video service, and how it could be applied to crypto-enabled business models of the future:
Let’s leave aside the legitimate fear that now Amazon has even MORE information about you, locked away in proprietary databases, and can manipulate you at will since who cares about that anyway, right?
What Amazon is now doing, better than anyone in the history of TV has ever done, is tie content viewing directly to revenue.
For every show you watch, intro you skip over, episode you quit halfway through…every single click, you are going to earn some sort of crypto-token for it.
That’s right, you will get paid to watch TV. (That’s all we need, right? At least my kids can become revenue generators now.)
Vendors will run AI algorithms on all of the data that you (and others) generate and serve even more relevant ads based on your viewing habits.
You’ll get your content for free and you will get paid to watch it. Then, you’ll use those crypto-tokens to buy the products that advertisers put in front of you (which is paid for in the same crypto-tokens), all part of the circular economy.
It likely won’t be Amazon that will find a way to pay you, as they’ve shown they are happy to keep your data in exchange for finding ways to sell more, but there are new business models, made possible by crypto and blockchain.
via Amazon Shows How You Will Get Paid in Cryptocurrency to Watch TV at Never Stop Marketing…
It is not easy to keep an eye on the “long game” during periods of mania like the one we are experiencing. The attention of the world is on the currencies, but people like CNBC are missing the point. The bulk of the iceberg lies below the water. The same is true with crypto. That is where you should keep your eyes as well.
via 2018: The Year the Crypto Sh*t Starts Getting Real at Never Stop Marketing…
CoinMetrics with a post on how reliable crypto data may be among various sources. Despite access to a lot of raw data, there’s a lot of issues with interpreting that data. It’s part of the ongoing problem of figuring out how to value cryptoassets:
So to conclude, on-chain volume and transaction count can both be faked and can be tricky to estimate. Exchange volume must be viewed fairly skeptically. Market cap has a whole host of methodological issues. Generated coins and fees, however, are much more concrete.
via On data and certainty at Coin Metrics
Coinbase, the bitcoin trading broker that has exploded in popularity as cryptocurrencies surge and nose dive, has encountered an unusual problem for a Silicon Valley startup: Too many investors are trying to get in. The six-year-old company crossed $1 billion in revenue last year, Recode has learned from industry sources, a tremendous rise fueled by layman interest in both bitcoin and competing virtual currencies that users can buy and sell through the app.