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Cryptocurrency Market Gives Back Most of Last Week’s Gain; XRP Plunges

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The cryptocurrency market extended its slide on Tuesday, with XRP’s double-digit drop leading the decline as sellers regained the upper hand following weekend consolidation.

Market Update

The combined value of all cryptocurrencies fell by another $10 billion on Tuesday to $207.5 billion, the lowest in five days. The selloff was accompanied by a slight pick-up in trading volumes with total market turnover reaching $14.2 billion.

XRP was by far the biggest decliner, falling 15.2% to $0.452. The third-largest cryptocurrency by market cap is down 34% from recent peak levels.

Ethereum also fell hard on Tuesday, shedding 9.1% to $212. EOS also declined 9.1% to $5.18. Meanwhile, bitcoin cash was off 5.5% at $441.

Compared with altcoins and tokens, bitcoin’s price action was more subdued. BTC declined 3% to $6,426 but saw its market share climb to 53.6%. Bitcoin’s dominance rate recently fell to its lowest in almost six weeks.

Struggling for Momentum

The Tuesday selloff was an extension of early-week volatility that saw coin values decline by more than $10 billion. Since peaking slightly above $230 billion last week, cryptoassets have lost $23 billion in combined value.

The sudden and sharp reversal wasn’t entirely unexpected. XRP faced extremely overbought conditions after prices more than tripled last week. Investors’ euphoria stemmed from a trio of announcements involving XRP’s parent company, Ripple Labs, which pointed to wider mainstream adoption of blockchain technology and cryptocurrency.

XRP’s massive gains fueled optimism that other comparable projects would soon follow suit. Stellar XLM, another high-profile blockchain project, surged last week amid news it had acquired Chain, a San Francisco-based startup. Stellar’s commercial arm and the newly acquired Chain formed a new company called Interstellar.

For all the positive developments underway in the blockchain arena, cryptocurrencies remain firmly entrenched in a long-term bear market. This is unlikely to change in the near future as capital flows into ICOs dry up and leading projects like Ethereum address their litany of issues.

As Hacked reported last month, the cryptocurrency market appears to be undergoing a paradigm shift as low-quality coins embark on a mass extinction event. Ethereum’s Vitalik Buterin once predicted that 90% of tokens listed on CoinMarketCap will go to zero. Presently, there are 1,993 projects listed on CoinMarketCap. Among them, 1,593 have a market cap higher than zero.

Disclaimer: The author owns bitcoin, Ethereum and other cryptocurrencies. He holds investment positions in the coins, but does not engage in short-term or day-trading.

Featured image courtesy of Shutterstock.

Important: Never invest (trade with) money you can't afford to comfortably lose. Always do your own research and due diligence before placing a trade. Read our Terms & Conditions here. Trade recommendations and analysis are written by our analysts which might have different opinions. Read my 6 Golden Steps to Financial Freedom here. Best regards, Jonas Borchgrevink.

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4.6 stars on average, based on 643 rated postsSam Bourgi is Chief Editor to Hacked.com, where he specializes in cryptocurrency, economics and the broader financial markets. Sam has nearly eight years of progressive experience as an analyst, writer and financial market commentator where he has contributed to the world's foremost newscasts.




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Why Investors Should Pay Attention to Kyber Network

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The current cryptocurrency ecosystem isn’t nearly as well-connected as it should be. Some coins are very difficult to exchange, and others are very hard to find on any of the common centralized exchanges. This often leads to users going to services like Binance, but in an industry as innovative as the blockchain industry, some new methods have popped up that show promise.

Decentralized exchanges have been popping up everywhere, but Kyber Network has formulated a unique approach to the liquidity and volume problems that currently plague most of these exchanges.

Kyber Network’s Mission

The basic need for Kyber Network comes from the idea that the current evolution of the blockchain ecosystem is incomplete and there is much more that could (and should) be done. The regulations currently in place have made it difficult for centralized exchanges to effectively list new coins, and many crypto-enthusiasts end up stuck with a high variety of digital assets.

Centralization is generally something that the cryptocurrency industry would like to avoid. As we’ve seen in the last few years, many of the current trading exchanges have a ton of inefficiency, as well as security issues and some bureaucracy. This is where much of the need for decentralized exchanges has originated.

Kyber Network’s top innovation is the elimination of order books in favour of using large reserves. There are numerous reserves in place for each currency, which creates redundancy and reduces centralization. This also allows for instant exchanges, which is helpful since many of the top criticisms of decentralized exchanges was the latency issues that often manifest. Although to be clear, Kyber doesn’t refer to itself as a decentralized exchange, but does generally compete in the same space with them.

The Mechanics of Kyber Network

Kyber Network basically operates as an exchange that allows for the fluid transfer of tokens between individuals, allowing them to give and receive in different tokens. This is great when the person sending has Ethereum, and the person receiving wishes only to hold Stellar Lumens.

The way it works is there are reserve entities that hold large amounts of tokens and are compensated a small fee (or a spread) in exchange for providing liquidity to users.

KNC is the Kyber Network token, and it is generally charged to the reserve entities as a cost of doing business on the network. Each time an exchange occurs, a small transaction fee is charged to the reserve. Reserves make their money on the spreads, and then tokens are charged from the reserve managers.

Recent Performance

2018 has seen Kyber place a significant focus on partnerships and continuing to develop their trading breadth. They partnerships include exchanges and wallets that include OasisDEX, Peepeth, ETHIS, Etheremon, Secrypto, Midas Protocol Wallet and Weswap. Additionally, they are now on the final phase of the development of their platform, which includes supporting the trading of options and forwards contracts.

The KNC token has recently been added to Poloniex, but is trading around $0.38, which represents an approximate drop of 95% from it’s all-time high. It is around 20% above its all-time low, and this makes it a strong buying opportunity right now. KNC can be bought on Binance and a few other altcoin trading exchanges, and serves to be a strong bet if you believe in the mechanics of its trading exchange.

Disclaimer: The author owns bitcoin, Ethereum and other cryptocurrencies. He holds investment positions in the coins, but does not engage in short-term or day-trading.

Featured image courtesy of Shutterstock.

Important: Never invest (trade with) money you can't afford to comfortably lose. Always do your own research and due diligence before placing a trade. Read our Terms & Conditions here. Trade recommendations and analysis are written by our analysts which might have different opinions. Read my 6 Golden Steps to Financial Freedom here. Best regards, Jonas Borchgrevink.

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A Few Lessons From Last Week

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There is an adage on Wall Street.  It is quite old. It was passed down to me from my grandfather last Wednesday.  It goes something like this. When the cops raid the brothel, they take everybody including the piano player.  

No matter when the notion originated, it applies directly, and painfully, to last week’s experience with stocks, bonds and crypto assets. Between early Wednesday and Thursdays New York closing, most major US indices dropped a fast five percent.  Friday showed a tepid rebound with the tech heavy NASDAQ posting a 2.3% one day recovery followed by the S&P 500 with a meager 1.2% upward move. Otherwise there wasn’t much good happening.

The story in crypto land wasn’t any better.  In truth it was worse. Taking just the two big guys during the same Wednesday/Thursday time period, things were dismal.  Bitcoin lost 6% in price before staging a weak 1.1% recovery on Friday. Ether dropped 15.6% on Wednesday, then managed a 3.2% Friday bounce.

Nobody escaped untouched unless you were a short seller in which case, congrats! Having lots of company is hardly any consolation for having to deal with investment losses, even if there are only accounting losses.  Nevertheless, everyone who had the ability to read understood the stock market was on a record breaking binge and thus vulnerable.

The only binge connected to crypto prices was a 10 month long hangover from the record levels of late last year.  So should the Wall Street adage be applied here making crypto take on the role of piano player? Or to present the question in a different way, is the piano player merely an innocent victim of being in the wrong place at the wrong time?

The Stock Market Correction Is Not Over

Stock market corrections are never pleasant but many veteran strategist consider them to be a necessary and even healthy part of the investment process.  Last week’s 5% drop was not even pronounced enough to qualify as a bona fide correction. That requires something even more than the 8%+ drop that took place back in February.  

In the very short term, there is little in economic news that is likely to upset the market this coming week but that doesn’t change the fact that interest rates are putting pressure in bond prices and $80 oil prices aren’t helping the inflation picture either.  Finally, there is the uncertainty created by the midterm elections. Making short run market predictions is a fools game, but this one is an exception.

What Does This Say About Crypto Values?

After events of the last week where already depressed crypto values get beaten down even further than stocks and bonds, that is not a good sign.  One of the reasons for this had to be last weeks report from Diar Ltd. showing how Coinbase’s active customers have dropped 80% from record levels of $24 billion in the fourth quarter of last year to $3 billion in the third quarter of 2018.  News of this study was reported by Bloomberg on Wednesday. So this could well have been the fundamental culprit. If so, the timing could not have been better for the short sellers.

No Longer Trending?

The folks at Diar Ltd. are spot on in their analysis but does this mean the end for crypto? Don’t count on it.  In fact there is a positive side to their findings. The most important point is the crypto prices (except for Wednesday) have become increasingly stable.  This stability will serve long term investors well as it will calm the nerves of regulators and merchants inclined to use crypto as a medium of exchange.

The drop off in activity at Coinbase is not surprising.  Speculators have lost interest. Recently we wrote an article about the competition for investor attention between crypto and cannabis.  There is loads of anecdotal evidence suggesting that this is contributing to crypto interest declining.

Here is just two points to remember.  This week on October 17, cannabis becomes legal for the first time throughout Canada. Investors are acutely aware of this bonanza.  During one of the worst weeks in the stock market, US listed cannabis stocks like Medmen Enterprises (MMNFF: $5.84) gained 35% while APHRIA (APHQF: $14.65) added over 13%.  Both stocks experienced greatly accelerated volume. This is an example of just two of many cannabis opportunities that are challenging crypto for investment capital. So the piano player may not be so innocent: he could just be smoking a little ganja.

Featured image courtesy of Shutterstock. 

Important: Never invest (trade with) money you can't afford to comfortably lose. Always do your own research and due diligence before placing a trade. Read our Terms & Conditions here. Trade recommendations and analysis are written by our analysts which might have different opinions. Read my 6 Golden Steps to Financial Freedom here. Best regards, Jonas Borchgrevink.

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4.4 stars on average, based on 112 rated postsJames Waggoner is a veteran Wall Street analyst and hedge fund manager who has spent the past few years researching the fintech possibilities of cryptocurrencies. He has a special passion for writing about the future of crypto.




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Altcoins Share Spoils as Global Volume Hits 3-Month Low; Bitcoin Price Remains Stable

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Very little new money has entered the crypto market in the last seven days, with volumes instead falling from $16.8 billion down to $8.9 billion. That’s the lowest that global trade volumes has fallen since July 15th – almost exactly three months ago.

For those curious what happened the last time trade volumes hit such a low point, the previous drop to the $8 billion range was soon followed by a 25% market wide surge. That was during the spike of late July, and those losses were soon wiped out again in August, when global markets sunk by one third.

Since Bitcoin’s descent from the $6,800 range down to the current $6,300 range, BTC has remained just as steady as it was from before October 10th’s dip. BTC has traded within a tight range for the past few days, never once deviating from between $6,240 and $6,340 – a 1.6% band.

Altcoins Share the Spoils

Instead, the majority of market gains have found their way to the altcoin market. While Tron (TRX) leads the major alts with its consistent growth recorded over the past few weeks, the biggest change in the market cap top one-hundred for Sunday goes to Komodo (KMD).

Komodo (KMD)

Komodo (KMD) saw its dollar valuation by just under 13% across Sunday, with the KMD coin jumping from a price of $0.993784 recorded on Sunday morning, up to the $1.12 valuation reached on the same evening.

That leaves KMD just a hop, skip and jump away from the pre-October dip price of $1.18, and marks one of the stronger recoveries from what was termed ‘Thursday, Bloody Thursday’ by some.

KMD volumes followed the rest of the market as they descended by 98% over the last few days, falling from the $3.5 million range down to $350,000. Today’s surge saw volumes rise once more as they climbed to $1.3 million by Sunday evening. Just under 70% of total KMD trades are against BTC today, in an unusual sign of Bitcoin dominance (which recently rose to 54% globally).

DigixDAO, Polymath and Aelf

The other top performers in the top one-hundred have proved to be the smaller altcoins, which often surge first following a market dip. It’s something approaching a lottery trying to guess which altcoin is going to pump, and there’s little to connect today’s market growers.

DigixDAO (DGD), a cryptocurrency backed by physical stores of gold, saw 6% growth over the previous twenty-four period.

Polymath (POLY), a project which seeks to tokenize securities on the blockchain, also climbed by just over 6%, helped in no small part by the 33% of trades coming from the POLY/KRW pair.

Finally, Aelf (ELF), a blockchain-based cloud-computing network, hit just over 5% growth for Sunday. Although, that barely makes up for the 20% loss recorded just a few days ago on October 10th.

Disclaimer: The author owns bitcoin, Ethereum and other cryptocurrencies. He holds investment positions in the coins, but does not engage in short-term or day-trading.

Featured image courtesy of Shutterstock.

Important: Never invest (trade with) money you can't afford to comfortably lose. Always do your own research and due diligence before placing a trade. Read our Terms & Conditions here. Trade recommendations and analysis are written by our analysts which might have different opinions. Read my 6 Golden Steps to Financial Freedom here. Best regards, Jonas Borchgrevink.

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4.4 stars on average, based on 78 rated postsGreg Thomson is a full-time crypto writer and digital nomad. He eats ICOs for breakfast and bleeds altcoins. Wherever he lays his public key is his home.




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