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ICO Analysis: Hero

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The current state of cryptocurrency gambling is not yet the best it could be. While we have the option to bet sports at the likes of CloudBet and others, or to provably fairly roll dice at PrimeDice and others, what we don’t have is enough ways to bet against each other. For most people, the concept of sports betting doesn’t extend beyond betting with each other. This is the concept behind Hero, which wants to enable people to, in a decentralized manner, bet with each other on sporting events. That’s how simple it is at the base layer, but there are a few things yet to go over.

A high amount of untrustworthy and off-shore providers has lowered the trust of people in the current betting market. It is never completely guaranteed that users receive their winnings. All these problems have one common ground—centralization. Centralized systems create excessive risks for users like exploitation of user data, prohibitive legal regulations, vulnerability to manipulation and denial of withdrawals. That is where the blockchain and the HERO coin (‘HERO’) come into play. […] The smart contracts of HERO are designed to not only enable decentralized betting, but to manage whole contests without a middleman. With HERO, there is no need of bookmakers anymore.

It may still be hard to see what they’re talking about. Basically, Hero is going to be a platform that allows people to make fair bets between each other, with no brokers or bookmakers.

What if the community becomes the middleman? […] Here‘s where the blockchain technology comes in place. The HERO Network allows peer-2-peer predictions of the outcome of games to take place independent of middlemen, such as bookkeepers or betting providers. The system relies on an innovative pooling system that makes it possible for players to challenge their friends or the community directly instead of using the services of bookmakers. The objective is to revolutionize the monotonous betting market and to bring back the lost social thought of betting.

Elsewhere in this paper, Hero claim that the system of online gambling hasn’t changed for 15 years. Now, in general, it can be assumed that many things do not change because they simply work. Indoor plumbing, for instance, hasn’t had to improve very much at the base of it. Similarly, one really has to ask: is the current online gambling and bookie system not working? Well, perhaps that’s not truly relevant. Perhaps the question we actually want to ask is: will enough people be willing to try this alternative method?

Enter the Herosphere, which is briefly mentioned elsewhere in the paper, and is an existing community of 200,00 people. In a moment we’ll discuss more about it, but the bottom line is if this community is immediately converted to the token, and they have to buy more of them to place more bets, then it would seem that the token will have a demand out of the gate. This is a positive sign, to say the least, but we’ll have to continue looking here before we can decide if we feel positively or not.

The above being said, what we conclude, really, is that what we’re dealing with is in fact a situation wherein anyone can participate, and the network becomes the bookie. Anyone can offer bets, however. They give the example of a Twitch streamer who might incentivize the audience and be compensated through the network for offering a contest amongst them.

Herosphere

The HERO Network will first be implemented and tested on the Developer‘s own esports platform herosphere.gg where HERO will be exposed to an existing user base of over 200,000 active players.

While it is not made totally clear if the issue will be forced, one thing that is made clear is that every contest will pay 1% of its proceeds to the network as a whole. This is an interesting scheme which may encourage people to hold the token. If that becomes the case, demand for it will only increase, and ability to meet that demand will decline, as holders just continue to collect their rewards.

If this were to happen and a significant number of coins were kept off market, the price would probably increase just by natural market economics. That would be an interesting way to increase the value of a coin, so it will be a good experiment to watch. In any case, the prospect of a dividend on the token is probably a plus for most long-term investors, but short-term investors won’t be in it long enough to care about that part of it. Nevertheless, as previously described, this coin might see solid gains as a result of people trying to hold it for the dividend.

We know that Hero’s team have successfully run their company at Herosphere.gg since 2014. We see no reason they won’t be able to handle the actual implementation of the software. Instead, we’ll focus our attention on the project itself, in this case.

Hero Token

As stated, all token holders will receive a 1% rake back of everything done on the network. This will incentivize at least a small population of investors to hold long-term, stacking up these gains and riding the charts.

We know that 600 million tokens will be issued, but 2 billion will exist in sum total, which is quite a few, but if enough betting activity takes place on the network, then it won’t actually matter how many coins are out there. Additionally, if a lot of coins are held off the market, then the demand for those that are on the market will float the price a bit higher, at least. Tokens will be around 2 and a half cents at opening, giving room for growth. However, with 2 billion coins in the wind, if the price hits 10 cents, you’re talking about a $200 million market cap. If the price hits $20, you’re talking about many billions. So it’s unlikely that we’ll see an extreme upward valuation, but there will definitely be enough play that you can make something.

Distribution

Only 600 million coins are coming out in the crowd sale. The rest will be held back. They give their various explanations, but this is just absurd. The ICO firms that are coming out are increasingly thinking this is just the time to grab free money. We can’t abide these distribution schemes. If there are going to be 2 billion coins in total, then all of them should be available for sale immediately. It doesn’t matter if that lowers the price, or if the target raise is only several million dollars. The coins should be available to the public, since you’re taking the funds that you get from selling the tokens and using those funds, by keeping the tokens as well, you double dip. By keeping that many tokens, you deeply double-dip.

The Verdict

We definitely don’t like the distribution on this one, despite the following explanation:

A total amount of 2 billion HERO will be created by the Developer. The Developer intends to exchange only 600 million HERO (or 30 percent of the Total Coin Amount) in this Initial Coin Offer for Ether. The remaining 1.4 billion HERO (or 70 percent of the Total Coin Amount) will be used for other purposes. The Developer explicitly reserves the right to exchange the retained portion of 1.4 billion HERO for other virtual currencies or sell it for Euro or any other fiat currency at a later point in time at any marketable price. However, the Developer will commit itself to adhere to the following restrictions in the use, exchange or selling of HERO on the market. Especially, the Developer will commit itself to only exchange or sell such amounts of HERO that, to the best knowledge of the Developer, would not have a visible impact on the market value of HERO.

So, overall, we probably wouldn’t get involved. Although there is a nice dividend, overall, there are problems we’d rather not get involved with – like the above.

Risk

  • Too many coins means that the 1% dividends split amongst all coins is a lot less money. -1
  • Moreover, since 1.4 billion of the 2 billion coins belong to the “Developer,” most token holders wouldn’t get much of the proceeds anyway. -1
  • There’s a risk that people may be comfortable where they are in terms of betting. -1

Growth Potential

  • Gambling is big money. +4
  • The established community is a positive. +2
  • We think this thing will work, the token will just always have a low value. +1

Disposition

We arrive at a 4, or less than thrilled, on Hero.

Investment Details

To get a piece of the 600 million coins being offered for sale, visit Herocoin.io on September 14, 2017 14:00 UTC.

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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5 stars on average, based on 2 rated postsP. H. Madore has covered the cryptocurrency beat over the course of hundreds of articles for Hacked's sister site, CryptoCoinsNews, as well as some of her competitors. He is a major contributing developer to the Woodcoin project, and has made technical contributions on a number of other cryptocurrency projects. In spare time, he recently began a more personalized, weekly newsletter at http://ico.phm.link




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  1. beaupain

    September 8, 2017 at 1:51 pm

    Thanks for the detailed en clear analysis!

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Altcoins

EOS Price Forecast: EOS/USD Heading for Another 300% Move?

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  • EOS/USD price action via the 4-hour chart view has formed a bullish flag pattern.
  • The price is moving around levels seen back end of March to early April, before a bull run of over 300%.

The past six sessions for EOS/USD have been erratic to say the least. It has been subject to a high amount of volatility, swinging aggressively in both directions. There has been a lack of commitment from either the bear or bull camps of late. As the market continues to trade with such behavior, it appears to be trying to find its feet, ahead of a potential chunky firm trend.

EOS DApp Hacked Again

An EOS based gambling DApp, EOSBet has been hacked, with $338,000 being reported as stolen. This isn’t the first time; just back in September, hackers managed to get away with a reported 40,000 worth of EOS, which at the time had a value of $200,000. It has been said that they were able to exploit their smart contracts, having found security vulnerabilities.

Technical Review – 4-hour Chart View

EOS/USD 4-hour chart

EOS/USD price action has formed a bullish flag pattern, which began taking shape on 15th October, after the aggressive price behavior stabilized. The bulls at the time ran the price well up into $6 territory. Consequently, it then met the breached ascending trend line, failing to move back above this area. This followed the sharp breakthrough to the downside, which occurred on 11th October. As a result, a drop of over 15% was seen, forcing EOS/USD to retreat in a demand area, within the $5.0000 level proximity.

Looking to the upside, small near-term resistance is seen at around $5.6100, which is the upper trend line of the mentioned bull flag pattern. A breakout will likely open the doors to a retest of the broken ascending trend line, tracking around $6.1100. Support can be eyed at $5.4600, which marks the lower trend line of the flag. Furthermore, should this fail to hold, EOS/USD could likely fall back down to the serving demand area, within the lower $5.0000 territory.

April 2018 Bull Run

EOS/USD April bull run

In April of this year EOS/USD entered a chunky bull run, gaining over 300%. From the back end of March until 11th April, the price had been stuck within consolidation mode. Resulting in the price trading within a tight range, at levels of where the price is currently seen today.

Something quite astonishing started to unfold. Between the period of 11th April to the 29th April, a bull run of around 290% was seen. Over this time frame EOS/USD went from $5.9500 up to a high of around $23.0811. The price is currently demonstrating a similar behavior to that of what was seen during the mentioned period. It is interesting to note that the price did have historical levels to break through, as it had already run higher during the period of December 2017 and came back down. Finally, this is not to say EOS/USD will observe the same bull run. However, it is an interesting observation to be aware of.

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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4.5 stars on average, based on 30 rated postsKen has over 8 years exposure to the financial markets. During a large part of his career, he worked as an analyst, covering a variety of asset classes; forex, fixed income, commodities, equities and cryptocurrencies. Ken has gone on to become a regular contributor across several large news and analysis outlets.




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Analysis

Pre-Market Analysis And Chartbook: Risk Assets Under Pressure as Fed Minutes Loom

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Wednesday Market Snapshot

Asset Current Value Daily Change
S&P 500 2,789 -0.98%
DAX 30 11,715 -0.52%
WTI Crude Oil 69.79 -3.27%
GOLD 1,229 0.13%
Bitcoin 6,429 -0.49%
EUR/USD 1.1528 -0.38%

While yesterday we saw a huge oversold rally in equities, with the help of positive corporate earnings, the easing of the US-Saudi standoff and the stability in Treasury yields, today investor sentiment shifted yet again.

Negative news regarding the US-Chinese trade war, which is very likely to intensify before the US midterms, dismal European car sales, and continued worries with regards to the Italian budget and the Brexit process all acted as bearish catalysts.

DAX 30 Index CFD, 4-Hour Chart Analysis

Although European markets followed the lead of Wall Street and rallied today in early trading, the major indices are already well below their intraday highs, after turning back from the first levels of resistance. The DAX ran into resistance near the 11,850 level, below the crucial 12,000 level that could be the line-in-the-sand in deciding the long-term outlook going forward.

The German benchmark, the FTSE 100, and the EuroStoxx 50 are all in strong declining trends, and with the most important Asian markets also under strong short-term selling pressure, the US markets have a steeper and steeper mountain to climb should they resume the bull market.

Nasdaq 100 Futures, 4-Hour Chart Analysis

The Nasdaq opened slightly below yesterday’s cash close, underperforming the Dow and the S&P 500, and since then sellers have been in control of the market. The Russell 2000 that has been showing the way for the broader market lately is deep in the red as well, and we still think that risk assets are facing a prolonged correction if not an outright bear market.

Treasury yields are stable before today’s most important release, the minutes from the Fed’s latest meeting, but the dynamics of the quantitative tightening (the shrinking balance sheets of the global central banks) are likely behind the faltering of global risk assets.

VIX Pulls Back as Dollar Attempts Rally

VIX (US Volatility Index), 4-Hour Chart Analysis

The US Volatility Index fell significantly amid the bounce in stocks, hitting the key 17 level yesterday after plunging below 20, but the chart of the measure still confirms the regime change that would be consistent with a prolonged bearish period. While the bounce could still continue, forming a more complex pattern, the volatility-conditions could very important to judge the stability of the market.

EUR/USD, 4-Hour Chart Analysis

Forex markets continue to experience heavy trading, and today the US Dollar is trying to gain back momentum after its recent correction. Although the worse than expected housing data (building permits and housing starts both missed expectations) could have been bearish catalysts today, the Greenback held on to most of its early gains.

Should the reserve currency form a swing low and continue its broader rising trend, emerging markets could be back in the crosshairs, and risk assets would face another problem. All eyes are on the support zone near 1.15 in the EUR/USD pair, as a move below that would be a bullish sign for the USD, and it would warn of a test of the August low near 1.13.

ChartBook

Major Stock Indices

S&P 500 Futures, 4-Hour Chart Analysis

Dow 30 Futures, 4-Hour Chart Analysis

FTSE 100 Index CFD, 4-Hour Chart Analysis

EuroStoxx50 Index CFD, 4-Hour Chart Analysis

Nikkei 225 Futures, 4-Hour Chart Analysis

Shanghai Composite Index CFD, 4-Hour Chart Analysis

EEM (Emerging Markets ETF), 4-Hour Chart Analysis

Forex

USD/JPY, 4-Hour Chart Analysis

GBP/USD, 4-Hour Chart Analysis

EUR/GBP, 4-Hour Chart Analysis

AUD/USD, 4-Hour Chart Analysis

Commodities

WTI Crude Oil, 4-Hour Chart Analysis

Gold Futures, 4-Hour Chart Analysis

Copper Futures, 4-Hour Chart Analysis

Featured image from 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 377 rated postsTrader and financial analyst, with 10 years of experience in the field. An expert in technical analysis and risk management, but also an avid practitioner of value investment and passive strategies, with a passion towards anything that is connected to the market.




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Analysis

Crypto Update: Altcoin Market Cap on the Verge of Trend Reversal

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Fund managers and investors often rely on a market index to get a general sense of where the market may be headed. Usually, an index is the weighted average of the largest or the best performing equities in the market. For example, the Standard and Poor’s 500 Index (SPX) is the combination of 500 of the largest US stocks represented as one index value. These indices act as a barometer as they represent and influence the performance of the entire market.

For someone who invests in stocks and cryptos, I understand the importance of an index and apparently, I’m not alone. Cryptocurrencies don’t have an official index that could serve as a weather vane so someone created one. The creator/s of coinsignals.trade pulled data from coinmarketcap.com to provide charts and candles and reflect the price movement of the entire altcoin market (coin market capitalization minus bitcoin capitalization). This gives us the opportunity to analyze the direction of all altcoins. What we saw was promising.

In this article, we reveal how the altcoin market cap is on the verge of reversing its trend.

Weak Breakout from Falling Wedge  

The altcoin market cap managed to go as high as $554.916 billion in January 2018. At that market cap level, the parabolic run of altcoins came to a screeching halt. The market went into a downward spiral as it generated a series of lower highs and lower lows. A quick look at the weekly chart shows that the market cap was inside a large falling wedge.

The weekly chart of Alts

The market eventually broke out of the pattern in September 2018. However, the breakout had no legs as volume was actually thinner than its weekly average. Even so, alts attempted to generate a breakout rally, which was firmly rejected at $112 billion several times. As a result, the market tumbled.

Nevertheless, this weak volume breakout would set the stage for the market’s bounce.

Key Support Levels to the Rescue

In technical analysis, former resistances become reliable support areas. These former resistances turned out to be crucial in the bottoming out process of the altcoin market.

A quick look at the daily chart reveals that two support levels have kept bears at bay. The first one was the former resistance of the falling wedge. Notice how the altcoin market smoothly slid down to this support without breaching it. Even though this support is weak, it proved to be instrumental in the market’s bounce.

The daily chart of Alts

The other one is the parabolic support of $80 billion. This support was also a former resistance level. The altcoin market struggled to get above this level in October 2017. When it did, altcoins soared. The market apparently remembers this price action even after a year later as participants bought at this area.  

We’ve seen numerous altcoins such as Ripple (XRP/USD) and Monero (XMR/USD) become bullish after bouncing off parabolic support levels. Will we see the same action for the entire altcoin market cap? Perhaps, the emerging pattern on the daily chart can give us more clues.

Potential Inverse Head and Shoulders on the Daily

The market’s bounce at $80 billion was met with heavy selling at $112 billion on September 23. This is the same level that rejected the breakout rally that would have turned the market bullish. With bears defending the resistance, the altcoin market lost over $22 billion in value as it pulled back below $90 billion.

Inverse head and shoulders in the making

The good news is the retracement has enabled bulls to create a bullish higher low setup. This is the first higher low generated by the altcoin market in 2018. This is a huge development. If the lower high can kill bullish momentum, the higher low can suck the energy out of bearish momentum.

With a higher low in place, it appears that the altcoin market is creating an inverse head and shoulders pattern in preparation for a bullish breakout. I’ve said it many times: this is one of the most reliable structures in reversing a market’s trend. If altcoins follow the projected path, then we’re on the verge of a bullish breakout.

Bottom Line

Our analysis of the altcoin market capitalization chart reveals that the market is on verge of taking off. The weak breakout from the falling wedge, bounce from key support areas, and the emergence of an inverse head and shoulders pattern are all setting the stage for a massive crypto comeback. To those who are still bearish, maybe it’s time to reconsider your stance.

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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3.6 stars on average, based on 249 rated postsKiril is a financial professional with 4+ years of experience in financial writing, analysis and product ownership. He has passed all three CFA exams on first attempt and has a bachelor's degree with a specialty in finance. Kiril’s current focus is on cryptocurrencies and ETFs, as he does his own crypto research and is the subject matter expert at ETFdb.com. He also has his personal website, InvestorAcademy.org where he teaches people about the basics of investing. His ultimate goal is to help people with limited knowledge of finance and investments to create investment portfolios easily, and in line with their unique circumstances.




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