The SALT name is meaningful to us because it hearkens back to the time in history when table salt gained use as a store of value, becoming one of humanity’s first monies. By utilizing salt as a medium of exchange for food, clothing, and other general provisions, it was salt which broke the mold of what a currency could be – there was no longer need for intrinsic value, now value was just an abstraction. SALT is also the name given to our programmed loan smart contracts as an acronym for Secured Automated Lending Technology (SALT).
Cryptocurrency is money, and money catalyzes the growth of many services. In the beginning, you have the unit of exchange and nothing else. If the unit of exchange survives, you then have people who are willing to exchange said unit for goods, services, and alternative units of exchange. Following that, each of these expands into larger versions of themselves, and services grow to support those as well – a service is developed specifically to help others accept the unit of exchange, for instance. Once your economy is stable enough that all of these things work reasonably well, the speculator class develops margin lending instruments so that they can profit from the sidelines as well as the interactions themselves. And then, finally, some sort of international market is going to be necessary.
Since with cryptocurrency we already have an international currency, a better analogy for SALT is that they are creating an interplanetary means of leveraging cryptocurrencies. Whereas margin lending allows you to leverage what you have in order to achieve higher profits (or losses) in cryptocurrency, SALT lending allows you to leverage your cryptocurrency assets as collateral in any effort.
What SALT is
The idea, according to the company’s Shawn Owens, was born of the conclusion that many successful cryptocurrency traders would prefer to hold their assets instead of selling them, but that often they have no way to do this. Thus, if you want to convert your cryptocurrency assets into real-world utility, even though you believe they are going to continue retaining value, your only option is to sell and lose future revenues. For fiat lenders, SALT represents the opportunity to adequately assess and capitalize on very liquid, volatile asset classes that are mostly alien to them at present.
The SALT token itself is not a normal ICO ERC20 smart contract. It is a membership card. Its supply, therefore, will not be very limited, and making it transferable would seem fairly contrary to the notion of KYC/AML compliance. As such, no analysis is really necessary as regards of the SALT token. It is meaningless if the SALT platform itself has no future, and it is worth as much as you can earn from whatever you might do with a SALT loan dispensation. SALT is “intentionally unpurposed,” meaning the loans can be for anything. Cryptoasset holders can get home improvement loans, small business loans, big business loans, debt consolidation loans – any financial product that is offered by traditional fiat banks could be offered by lenders on the SALT
Cryptoasset holders can get home improvement loans, small business loans, big business loans, debt consolidation loans – any financial product that is offered by traditional fiat banks could be offered by lenders on the SALT platform, if all parties agree and the terms are legal within their jurisdictions of business. In a way, SALT is the Coinbase approach of cryptocurrency brought to its ratiocination – cryptocurrencies are completely legitimized and interchangeable with traditional asset classes, with less friction than previously imagined.
Owens gave an interview to the FutureTech podcast which m2akes it quite a bit easier to understand what is going on than does their lack of a whitepaper and very disparate frequently asked questions section. He made the following two statements that answer the biggest questions (what and when):
“What we’re really doing is introducing and creating a credit market that does not yet exist.”
“We hope to have a minimum viable product that’s accessible to the public at large in the 4th quarter of this year.”
What SALT Is Not
- An Initial Coin Offering
SALT is not an ICO looking to crowdfund an idea. It would perhaps be a different story altogether if they had to use such means to get off the ground — numerous fundamentals would be missing.This is an easy mistake for newcomers to the space to make. SALT is a service for everyday and institutional borrowers who have cryptocurrency assets as collateral and institutional or private investors who might important requirements.
- Peer-to-Peer Lending
Borrowers on the salt platform will apply for their loans in the traditional way that applications are done. They will not be put before a public review of thousands of people. SALT’s role in this will be to match borrower and lender. SALT’s Shawn Owens says that large-scale cryptocurrency holders could create an investment product with the SALT team if they wanted, but it might not be very attractive – what they could do is more of a mutual fund or high-return hedge fund vehicle in which they invest the funds for the lender.
Potential Unexpected Uses
- Crowdfunded Funds
While SALT is not specifically intended for use by the great unwashed crowdfund world, it’s not impossible to imagine various crowdfunding platforms developing instruments to allow their lenders access. The requirements to lend on SALT have a lot of legalities that would have to be meted out, but potentially funds could be created which would then be used to lend via SALT in order to achieve returns.
- Bloomberg-Type Services
If SALT succeeds and continues to create relationships between the cryptocurrency community and traditional financiers, one can imagine that reverse services will become available – SALT escrow services for institutional and other large scale transfers, SALT-backed ICOs, SALT-rated crypto tokens, and so forth.
- ICO Parlay
Successful ICO outfits will be swimming in cryptocurrency both at the beginning of and throughout their business cycles. These outfits will be very interested in a platform like SALT, where they can leverage these assets in order to expand their business without another public crowdsale or fully realizing a revenue stream. This is an answer to traditional VC second, third, fourth, et cetera series funding rounds that many start-ups go through.
A future with firms like SALT in it is a future that many cryptocurrency enthusiasts will be in favor of: one where your cryptocurrency assets are valued right alongside your physical and fiat ones in a universal manner. Others will follow, but SALT has a first-mover advantage. Many things remain unclear about the actual nuts and bolts of the system, but the potential for such a concept is very high. SALT will either be an integral part of the cryptocurrency economy in the coming years, an early minnow in a stream soon to be crowded with sharks and whales, or a totally forgotten effort that is reminiscent of something current.
The cost of the token can be written off in the same way that loan application fees can be – a cost of doing business. From here, all we can do is report that a new method of gaining traction in the financial world is afoot which considers cryptocurrencies to be fully legitimate.
Featured image from Shutterstock.
Daily Analysis: Dollar Falls, Gold Jumps after Yellen’s Final Move
Wednesday Market Recap
|Asset||Current Value||Daily Change|
|WTI Crude Oil||56.65||-0.68%|
The Federal Reserve hiked interest rates as expected today, and although the central bank’s monetary statement was slightly more hawkish than expected, the market’s reaction didn’t reflect the much-anticipated move. The worse than expected Core CPI reading that underlined the low-inflation narrative weighed on the recently strong Greenback, while stocks were unchanged after decision and bonds gained ground as yields retreated.
EUR/USD, 4-Hour Chart Analysis
The major indices are hovering near their all-time highs with the DOW leading the way higher, hitting a new record for the second day in a row. While volatility Is expected to remain low as we approach the end of the year, market internals and valuation levels are still concerning from a long-term perspective, and stocks outside the US are also negatively diverging. The action in crude oil could be slightly more interesting as the commodity is starting to act in a slightly bearish manner after a grinding multi-month rally.
WTI Crude Oil, 4-Hour Chart Analysis
The Brexit process is still in the center of attention in Europe, although volatility took a nosedive on the old continent as well, and it’s unlikely that the Christmas period will be much different, given the predictable drop in volumes and trading activity. The date of the next election in the financially and politically troubled Italy has been set to March 4th next year, and the early date caused some turmoil in the countries assets, which dragged the Euro Stoxx 50 lower today, together with the DAX and the other major indices.
As the total market cap of the crypto-market crossed the incredible $500 billion mark, Ripple, NEO, and Ethereum made headlines with lofty gains in the face of the severely overbought readings elsewhere in the segment. While XRP and NEO are still not overbought from an investment perspective, Ethereum reached our final target for its break-out and triggered a long-term sell signal.
ETH/USD, 4-Hour Chart Analysis
The previously surging IOTA continued its correction, Litecoin consolidated in a relatively narrow range, while Dash, ETC, and Monero scored marginal new highs before turning lower together with BTC. The most valuable coin that has lost some of its momentum “mojo” in recent days fell back below last week’s highs, and that could mark a failed break-out and a start of the deeper correction that seems more and more likely.
BTC/USD, 4-Hour Chart Analysis
Key Economic Releases on Wednesday
|11:30||UK||Claimant Count Change||5,900||3,300||6,500|
|15:30||US||Crude Oil Inventories||-5.1 mill||-3.6 mill||-5.6 mill|
|21:00||US||Fed Rate Decision||1.5%||1.5%||1.25%|
Featured image from Shutterstock
Technical Analysis: Volatility on the Rise Again, as Ripple and Ethereum Hit Targets
Ripple has been the star of today’s session in the cryptocurrency segment, as the only major coin on a long-term buy signal in our trend model continued yesterday’s break-out, and surged to a new all-time high. The currency cleared the $0.425 level that marked the top in May, and after the more than 6-month long consolidation phase, it promptly neared the $0.50 level.
While the short-term momentum indicators are now stretched, the coin is still in an encouraging long-term setup, although the best period to buy already passed. The coin could be dragged lower in the case of the expected broad correction in the segment, but we expect XRP to outperform in the coming period, with support levels found at the prior high and below that in the range between $0.30-$0.32.
XRP/USDT, 4-Hour Chart Analysis
Ethereum has been the other top coin on the rise, as the second largest digital currency surged past the final range projection target of the break-out two weeks ago at $685 in the aftermath of the launch of the BTC futures on Monday. The ETH token is now also on a sell signal on all time-frames, and we advise investors and investors to wait for the next major correction to establish new positions. Support levels are now found at $575, $500, $480, and $400.
ETH/USD, 4-Hour Chart Analysis
Technical Analysis: Bitcoin Grinds Higher as Records Tumble in Altcoins
The historical surge in the segment, which is the second such move this year, continued today, with another round of break-outs in some of the major altcoins and tepid gains for BTC investors. Ethereum, Ripple, Dash, and first and foremost Litecoin was leading the charge, with the recent star LTC topping $300, just after a day of hitting the $200 mark.
Litecoin defied all odds after reaching extremely overbought readings, and the coin rode the speculative wave, turning exponential, not unlike IOTA and Bitcoin previously. With the coin being stretched in an unprecedented way on all time-frames, investors could even consider selling their core positions at the current levels, as a deep correction is almost granted in the coming period. The first meaningful support level is found at $125, and a re-test of the $100 level is probable during the next major correction.
LTC/USD, 4-Hour Chart Analysis
Ripple finally ended a long period of relative weakness today, and the only major on a long-term by signal jumped over primary resistance at $0.26 and crossed the $0.30-$0.32 too in the euphoric sentiment. As the coin is not long-term overbought following the 6-month long consolidation, the buy signal in XRP remains intact, with the only major resistance level being found at the all-time high near $0.425.
XRPUSDT/USD, 4-Hour Chart Analysis
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