Category Archives: Cryptocurrency

With a track record going back over a decade, cryptocurrencies are clearly more than just a fad, but they remain widely misunderstood by many people, with doubts persisting about their genuine value, practical use and long-term application.

There is also considerable concern with regards to their volatile nature and potential for exploitation. According to data from Scamwatch, Australians lost $158 million to investment scams between January and May of this year, the majority of which related to cryptocurrency investments.

In the truest sense, cryptocurrencies are a digital means of exchange which use cryptography as a form of security. However, in recent times, the term cryptocurrency has evolved as a stand-in description for, more broadly, a decentralised financial system (DeFi), a highly volatile asset class that can nose-dive or surge on the back of a Tweet, a space for bad actors to steal vulnerable investors identities and money, and a form of digital payment.

Mainstream investors, as well as Australias financial institutions, are also taking more than a passing interest in cryptocurrencies.

The Commonwealth Bank is trialling crypto trading through its banking app, ANZ recently minted $30 million of Australian stablecoins called A$DC, and National Australia Bank (NAB) is also expected to release its own stablecoin (linked to fiat currency, the Australian dollar) by the end of 2022. However, concern over the safety of cryptocurrencies as an investment class remains front and centre in the minds of financial regulators around the world.

The simple answer is that they arent, outside the confines of blockchain technology, which well come to later.

Even more fundamentally, the current legal status of cryptocurrencies varies considerably from one country to another. While the use of cryptocurrencies is unfettered within the European Union, specific countries, such as Turkey, have banned the payments made in cryptocurrencies.

In Australia, cryptocurrency is legal but largely unregulated. Many crypto-assets and other digital assets are commonly not considered to be financial products so the platforms where you buy and sell cryptomay not be regulated by the corporate regulator, the Australian Securities and Investment Commission (ASIC).

The Australian Prudential Regulation Authority (APRA), which regulates the financial services industry, has plans for a policy roadmap for financial entities engaging in crypto activity. A draft standard is expected in late 2022. However, APRA has been keen to point out that it will not strangle innovation, with chairman Wayne Byres stating in a speech reported by The Australian Financial Review newspaper: Much like our approach to climate risk, its underlying message is primarily one of by all means innovate, but proceed with care and in full knowledge of the risks.

Australias Board of Taxation is also developing a policy framework for the taxation of transactions and assets involving cryptocurrency.

Consumer group, CHOICE, meanwhile, continues to rally for better protections for consumers, some of whom have lost vast sums in crypto scams or through market volatility.

As it stands, enforceable protections in the unregulated cryptocurrency market are somewhere between negligible and non-existent, CHOICE states.

In a submission to the federal government, CHOICE is calling for a regulatory regime to help put an end to consumer harm.

Most cryptocurrencies operate without the backing of an authority, such as a central bank or government. This fundamentally differentiates them from traditional currencies, such as the US or Australian dollar.

Instead of governmental guarantees, the way cryptocurrencies work is underpinned by something called blockchain technology (see below).

Rather than existing as a physical stack of notes or coins, cryptocurrencies are confined to the internet. Think of them as virtual tokens, whose value is determined by market forces generated by the people who want to buy or sell them.

Nowadays, an estimated five thousand cryptocurrencies exist. Bitcoin is far and away the largest, followed by the likes of Ethereum and Tether. The market capitalisation of a cryptocurrency equates to the unit price of a currency, multiplied by the number of units in existence. Even after the crypto meltdown in May of 2022, the market was still valued at about $US910 billion.

Cryptocurrencies can be bought with traditional cash such as Australian dollars and can then be used themselves to buy an expanding array of day-to-day goods and services. Cryptocurrencies have the same value in each country, making person-to-person transfers around the world easier, while negating the issue of exchange rates.

Only a limited number of Bitcoins actually exist cryptocurrencies are likened to a digital form of an asset such as gold, where a perceived store of value is then subject to the laws of supply and demand.

Currently, this is the main appeal of cryptocurrencies: that they are able to be traded on exchanges similar to the way stock market investors buy and sell shares and other commodities.

In essence, a blockchain is a type of database. Blockchain first came to prominence as the technology that underpinned Bitcoin when the cryptocurrency was originally mooted in a paper on peer-to-peer electronic cash systems in 2008.

The paper was credited to Satoshi Nakamoto, thought to have been a pseudonym for either an individual or group of people. Part of the cryptocurrencys design meant that there would only ever be 21 million Bitcoins created.

The blockchain is essentially a public ledger of every Bitcoin transaction that takes place. A record gets distributed across numerous computers and cannot be tampered with or changed retrospectively. According to supporters of cryptocurrencies, blockchain transactions are more secure than traditional payment mechanisms.

New units of currency such as Bitcoin are produced on the blockchain through mining, which requires huge volumes of computing power and thus uses significant amounts of energy. Environmentalists have warned that the proliferation of cryptocurrencies could have a significant impact on global attempts to reduce energy consumption.

The most common places to buy Bitcoin and other cryptocurrencies are specialist exchanges. This includes a range of trading platforms and apps that allow investors to buy cryptocurrencies using either traditional currencies and/or other cryptocurrencies.

To open an account, would-be traders are typically asked to provide passport details, a phone number and an email address. The costs of trading can vary from one exchange to another. Some providers impose a flat fee per trade, while others will charge a percentage of the overall transaction amount.

The performance of cryptocurrencies can be notoriously volatile with roller coaster peaks and troughs. In 2013, an individual Bitcoin was worth just a few dollars. At the time of writing (July 2022) its price stood just above the $US20,000 mark a huge increase on nine years ago, but some way off the all-time high of nearly $68,000 it achieved towards the end of 2021.

Cryptocurrency mining refers to the process of generating crypto and verifying new coins. It is a hugely complex business, one involving reams of decentralised and global computer networks, and, as many environmentalists point out, is carbon-intensive.

In the US alone, it is estimated that Bitcoin mining creates some 40 billion pounds of carbon emissions.

Despite the risks and lack of regulation, Australian investors have embraced cryptocurrency in recent years. A report by US crypto exchange Gemini found almost one in five (18%) of Australians bought digital currencies in 2021.

According to Geminis Global State of Crypto report, 43% of Australians first invested in crypto in 2021, with many citing inflation as a key reason. Furthermore, some 54% of Australians viewed cryptocurrency as a good way to diversify their assets, with 81% choosing to hold their crypto investments for the long term.

Data from trading platform eToro, reveals that more than one quarter of Australian investors aged 18-34 have at least 10% of their portfolios invested in cryptocurrency, making the asset class especially popular among Millennials.

Even before the pandemic upheavals of 2020, and the tumbling in crypto prices that began in November 2021, many experts have questioned their security, practical use and long-term viability. Hence the stark and repeated warnings from financial regulators and consumer groups that people should approach investments in this area with extreme caution.

If more mainstream investment houses dip their toes in the cryptocurrency waters, we may see digital assets improve in value, with their usage normalised and more widespread. How the sector will respond to mooted financial regulation in Australia is also yet to be seen.

In the uncertain times in which we live, it is also possible that the entire crypto concept may prove vulnerable or unsustainable in the face of as yet unforeseen challenges.

To paraphrase the regulators: buyer beware.

This article is not an endorsement of any particular cryptocurrency, broker or exchange nor does it constitute a recommendation of cryptocurrency as an investment class.

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What is a cryptocurrency? Forbes Advisor Australia - Forbes

Cryptocurrency prices have been rising over the last week, giving investors hope it could recover from its dramatic slump.

Bitcoin was valued at around $23,600 on Wednesday morning up almost 8 per cent in the last 24 hours. It was worth less than $19,400 a week ago.

Crypto prices are up almost across the board. Ethereum has climbed from just over $1,000 to $1,560 over the last week, while the likes of XRP, Binance Coin, Cardano, Dogecoin and Shiba Inu have also seen gains.

But will the upwards trend continue, and what do experts predict for the future?

Cryptocurrency prices have tracked closely with the stock market this year.

Markets have largely been in a downturn, but have rallied across the US, Europe and Asia recently, helping crypto follow suit.

Another likely trigger for the upturn in fortunes is the impending technology upgrade for Ethereum, which has now been scheduled for September.

Ethereum jumped by 12.5 per cent immediately after a developer tweeted that launch is targeted for 19 September.

This upgrade, known as Merge, could be significant for the entire crypto industry, as Ethereum is the blockchain that hosts the majority of Web3s infrastructure, including NFTs and gaming assets. Many see this as the future of digital currency.

Finally, the market may have finished suffering the fallout from multiple recent setbacks, including the collapse of Terras Luna stablecoin and the Celsius lending site.

Despite the recent price rise, experts are not getting too excited about an end to the crypto winter just yet.

Crypto expert Wendy O told NextAdvisor: Were in a full-blown bear market, not a bear cycle. Just because we see some positive price action doesnt mean were out of the clear.

Were currently trading (Ethereum) at $1,500, and in order for me to be super bullish on Ethereum, I would need to see us break above $2,248. Thats a 50 per cent price pump right there.

Joe DiPasquale, CEO of crypto asset manager BitBull Capital, said: While Bitcoin saw positive momentum this week, it remains range-bound when you take a broader view, and is still struggling to cross the $22,000 resistance.

For now, we remain interested in the bottom of this range when it comes to Bitcoins price, and are monitoring for accumulation during this range-bound movement.

Edward Moya, an analyst at broker Oanda, told Barrons there is hope of a continued upturn.

Wall Street is enjoying a positive risk-on mood that is good news for cryptos, he said.

If Bitcoin continues to stabilize here over the next two weeks, the crypto winter could be over. Market positioning became extreme and that could allow for the bottom to have been made if the institutional money buys in.

People invest at their own risk and cryptocurrencies are not regulated by British financial authorities.

All crypto investments are risky, but meme coins like Shiba Inu are particularly volatile, and you should be prepared to lose everything you invest.

The Financial Conduct Authority warned in January: Investing in cryptoassets, or investments and lending linked to them, generally involves taking very high risks with investors money.

If consumers invest in these types of product, they should be prepared to lose all their money.

Susannah Streeter, senior investment and markets analyst at Hargreaves Lansdown, previously explained the risks to i.

She said: On top of being extremely volatile, most cryptocurrencies are unregulated, which not only adds another layer of uncertainty but also means that investors have little or no protection against fraud.

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Why is crypto going up today? Bitcoin price explained and if cryptocurrency could recover from dramatic crash - iNews

Jaipur, Rajasthan, India, July 20, 2022 (GLOBE NEWSWIRE) -- YesWorldgenerates sustainable plans with measurable benefits and zero Investment efficiency upgrade. In the recent development, the company received the Biggest Cryptocurrency Gainers on July 18, and YesWorld Token gets listed on Coinsbit crypto-exchange, Highest Gainer on Exchange Up 4900%. It has been recorded that the volume is over $11.7 million.

YesWorld Token price is Up 4900 percent on its debut trading day on the Exchange. It was the highest percentage gainer among all cryptocurrencies trading on crypto exchanges. The volume recorded for YES WORLD Token is among the highest volume achieved by any Coin or Token on debut day. It is very positive news for traders and investors in the crypto space amidst the brutal comedown for several cryptocurrencies the following year.

Furthermore,YES WORLD Tokenis available with USDT pair. YES/USDT price opened at $0.0005. Because of its strong community and promotions around the YES Token launch, Exchange saw good volume right from the beginning. Volume started to pick up fast as Exchange listed YES WORLD Token being live on Exchange to its global community through various social media handles. Within a few hours, Token started to see significant price action with volume, and by noon the price was up 4900%, and volume among top cryptocurrencies trading on Coinsbit exchange.

In addition, most traders' experience with YES WORLD Token is that it has significant buying interest. There were very few sellers, and most people were interested in buying based on the order depth information on the Exchange. It shows the confidence of traders and investors in the vision of the YES WORLD Token and believes that it has a real value making it a good asset class investment.

Most experts predict YES token price will continue to see upward price movement in the coming days. Most pending trades and active orders show that people are ready to buy the asset-based Token, even at a higher price than the current market price. With such a strong buying interest and as volume picks, price is bound to further upside in coming sessions.

Volume details

This Token commands a market capitalization of more than $250 million based on today's current price at the time of writing this news. The volume of this cryptocurrency is $11.7 million, which is among the highest for a newly listed crypto token or coin on any exchange.

Based on the information available onYES WORLDToken's Twitter handle. Intending users must visit the following links to obtain more information about the project.

Twitter|Telegram|Website

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YesWorld bags the biggest cryptocurrency gainers on July 18. - GlobeNewswire

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The amount of cryptocurrency flowing into privacy-enhancing mixer services has reached an all-time high this year as funds from wallets belonging to government-sanctioned groups and criminal activity almost doubled, researchers reported on Thursday.

Mixers, also known as tumblers, obfuscate cryptocurrency transactions by creating a disconnect between the funds a user deposits and the funds the user withdraws. To do this, mixers pool funds deposited by large numbers of users and randomly mix them. Each user can withdraw the entire amount deposited, minus a cut for the mixer, but because the coins come from this jumbled pool, it's harder for blockchain investigators to track precisely where the money went.

Some mixers provide additional obfuscation by allowing users to withdraw funds in differing amounts sent to different wallet addresses. Others try to conceal the mixing activity altogether by changing the fee on each transaction or varying the type of deposit address used.

Mixer use isn't automatically illegal or unethical. Given how easy it is to track the flow of Bitcoin and some other types of cryptocurrency, there are legitimate privacy reasons anyone might want to use one. But given the rampant use of cryptocurrency in online crime, mixers have evolved as a must-use tool for criminals who want to cash out without being caught by authorities.

"Mixers present a difficult question to regulators and members of the cryptocurrency community," researchers from cryptocurrency analysis firm Chainalysis wrote in a report that linked the surge to increased volumes deposited by sanctioned and criminal groups. "Virtually everyone would acknowledge that financial privacy is valuable, and that in a vacuum, there's no reason services like mixers shouldn't be able to provide it. However, the data shows that mixers currently pose a significant money laundering risk, with 25 percent of funds coming from illicit addresses, and that cybercriminals associated with hostile governments are taking advantage."

The report added: "Mixers may soon become obsolete as Chainalysis continues to refine the ability to demix certain mixing transactions and see users original source of funds. But for the time being, our data shows that mixers are receiving more cryptocurrency than ever in 2022."

Cryptocurrency received by these mixers fluctuates significantly from day to day, so researchers find it more useful to use longer-term measures. The 30-day moving average of funds received by mixers hit $51.8 million in mid-April, an all-time high, Chainalysis reported. The high-water mark represented almost double the incoming volumes at the same point last year. What's more, illicit wallet addresses accounted for 23 percent of funds sent to mixers this year, up from 12 percent in 2021.

As the graph below illustrates, the increases come most notably from higher volumes sent from addresses connected to illicit activity, such as ransomware attacks, cryptocurrency scams, and stolen funds carried out by groups sanctioned by the US government. To a lesser extent, volumes sent from centralized exchanges, DeFi, or decentralized finance protocols, also drove the surge.

Chainalysis

A breakdown of volumes connected to illicit sources shows that the spike is driven primarily by sanctioned entitiesmainly Russian and North Korean in originfollowed by cryptocurrency thieves and fraudsters pushing cryptocurrency investment scams.

Chainalysis

The sanctioned entities are led by Hydra, a Russia-based dark web market that serves as a haven for criminals to buy and sell services and products to one another. In April, the US Department of Treasury sanctioned Hydra to stymie the group's efforts to liquidate their ill-gotten proceeds. The remaining volume from sanctioned groups came from the North Korean hacking group Lazarus and the Blender.io tumbler, which the US Treasury Department sanctioned earlier this year for serving the North Korean government.

Chainalysis

Despite their utility, mixers suffer a critical Achilles' heel: Large transactions make them ineffective, meaning that they work less efficiently when people use them to deposit large amounts of cryptocurrency.

"Since users are receiving a 'mix' of funds contributed by others, if one user floods the mixer and contributes significantly more than others, much of what they end up with will be made up of the funds they originally put in, making it possible to trace the funds back to their original source," Thursday's report explained. "In other words, mixers function best when they have a large number of users, all of whom are mixing comparable amounts of cryptocurrency."

Post updated to correct description of Blender.io.

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Cryptocurrency flowing into mixers hits an all-time high. Wanna guess why? - Ars Technica

Cryptocurrency exchange KuCoin has announced its investment from trading firm Susquehanna International Group (SIG). Apart from around a $10 million investment, the two parties plan to collaborate in blockchain startup incubation and KCS & KCC ecosystem building.

The support of SIG will aim to solidify our role as a centralised exchange and facilitate our ecosystem expansion in the decentralised Web3.0 world, Johnny Lyu, CEO, KuCoin, stated.

According to the cryptocurrency exchange, it will use the funds to upgrade platform infrastructure and enrich the product lineup, preparing for the next bull run. The capital will also support KuCoins global expansion and hiring plan. Despite the current cryptocurrency winter, KuCoin claims to have 300 job openings to be filled. In addition, KuCoin and SIG aim to jointly support cryptocurrency startups through incubation, investment, and consultation, especially the projects built on the KCC chain.

As per the SIG investment team, they believe this cooperation will create a synergy between SIG and KuCoin, with the aim to benefit the cryptocurrency industry by bringing it to a wider audience.

In May 2022, KuCoin raised $150 million led by Jump Crypto through a pre-Series B round, bringing its total investments to $170 million with Round A combined, at a total valuation of $10 billion.

SIG is a global quantitative trading firm. It claims to support trading of all listed financial products and asset classes, with a focus on derivatives, and also claims to handle millions of transactions on exchanges worldwide every day.

Established in 2017, KuCoin claims to have over 20 million users globally. The platform also claims to have supported trading of over 700 tokens and 1,200 trading pairs. According to its 2022 H1 review report, the exchange has achieved over $2 trillion in trading volume, a 180% increase compared to the same period in 2021.

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Cryptocurrency based KuCoin secures $10 million investment from trading firm SIG - The Financial Express

Over the past 24 hours, Wrapped Bitcoin's WBTC/USD price has risen 6.43% to $23,381.00. This continues its positive trend over the past week where it has experienced a 17.0% gain, moving from $19,861.82 to its current price. As it stands right now, the coin's all-time high is $70,643.00.

The chart below compares the price movement and volatility for Wrapped Bitcoin over the past 24 hours (left) to its price movement over the past week (right). The gray bands are Bollinger Bands, measuring the volatility for both the daily and weekly price movements. The wider the bands are, or the larger the gray area is at any given moment, the larger the volatility.

The trading volume for the coin has risen 115.0% over the past week diverging from the circulating supply of the coin, which has decreased 4.71%. This brings the circulating supply to 237.73 thousand, which makes up an estimated 100.0% of its max supply of 237.73 thousand. According to our data, the current market cap ranking for WBTC is #18 at $5.54 billion.

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This article was generated by Benzinga's automated content engine and reviewed by an editor.

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Cryptocurrency Wrapped Bitcoin Up More Than 6% In 24 hours - Benzinga - Benzinga

OKB's OKB/USD price has decreased 3.24% over the past 24 hours to $14.54. This is contrary to the coins performance over the past week where it has experienced an up-trend of 18.0%, moving from $12.29 to its current price.

The chart below compares the price movement and volatility for OKB over the past 24 hours (left) to its price movement over the past week (right). The gray bands are Bollinger Bands, measuring the volatility for both the daily and weekly price movements. The wider the bands are, or the larger the gray area is at any given moment, the larger the volatility.

The trading volume for the coin has climbed 99.0% over the past week, moving opposite, directionally, with the overall circulating supply of the coin, which has decreased 0.22%. This brings the circulating supply to 256.39 million. According to our data, the current market cap ranking for OKB is #22 at $3.71 billion.

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This article was generated by Benzinga's automated content engine and reviewed by an editor.

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Cryptocurrency OKB Decreases More Than 3% Within 24 hours - Benzinga - Benzinga

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Cryptocurrency prices have been on the rise in recent days, but some experts dont expect it to last.

Bitcoin rose 5% and topped nearly $22,000 over the weekend a big leap from when it fell to nearly $17,500 earlier this month. Ethereum saw a big jump too, rising to above $1,200. For investors, a big question still lingers: Is the crypto market truly recovering or is it just another false alarm, also known as a bull trap?

Some experts say signs point to a bull trap and investors should be wary, warning the worst may be yet to come amid ongoing macroeconomic uncertainty and bitcoins price, as well as other cryptocurrencies, could drop even further.

While we have seen bitcoin and ethereum rally recently after creating lows around $17,500 and $880 respectively, we are unconvinced about calling a low in place yet, says Richard Usher, head of over-the-counter trading at BCB Group, a crypto financial firm. The general risk environment remains on a knife edge, and while we think risk assets will rally significantly toward the end of the year, we see risks skewed to one more sell-off first.

Its easy for investors to hope the worst is in the past for the crypto market. Bitcoins price stayed above $20,000 and ethereum held above $1,100 on Tuesday, a significant jump from their 15-month lows just two weeks ago.

But with war raging in Ukraine, rising interest rates, inflation soaring, and talks of an impending recession, the coast is far from clear, experts say. Many are calling what were seeing with crypto prices this week a bull trap.

Thats when a stock or cryptocurrency reverses back down after a convincing rally and breaks below a prior support level. Basically, its a false signal, fooling investors into thinking the market is done falling and that its a good time to buy.

Experts say there will likely be another sell-off in the crypto market over the next few weeks or months. Wendy O, a crypto expert and educator, expects ethereum could fall as low as $750 and bitcoin could fall to $10,000. Kiana Danial, entrepreneur and author of Cryptocurrency Investing for Dummies, predicts bitcoin will fall to $11,000, while venture capitalist Kavita Gupta is calling for a bottom of $14,000 for bitcoin and $500 for ethereum.

Martin Hiesboeck, head of blockchain and crypto research at Uphold, says whether bitcoin holds above $20,000 has little to do with crypto itself and more with the overall geopolitical and macroeconomic situation, which he does not believe will improve significantly in the short term. The crypto market, which has been tracking with the stock markets lately, has been a casualty of the broader market sell-off of risky assets.

The war in Ukraine, supply chain gluts, and inflation are by far the biggest worries, Hiesboeck says. So far bitcoin hasnt exactly proven to be the inflation-proof safe haven its biggest fans believed it to be.

The crypto market is volatile and highly unpredictable, so buying cryptocurrencies at any price is risky let alone during a market dip that might not go away anytime soon.

However, if youve assessed your tolerance and can accept the risk, experts say now could be a good time to get in the crypto market since prices are lower than theyve been in years. Theres no such thing as a perfect time to enter the market, so keep in mind that price fluctuations are par for the course and be prepared for crypto prices to fall even more. Dont invest in crypto if you cant stomach sharp market swings, which can sometimes be as much as 15% in a 24-hour period.

Additionally, you should invest only what youre OK with losing and after youve prioritized other aspects of your finances, such as building an emergency fund, paying off high-interest debt, and investing in a traditional retirement account like a 401(k).

Financial advisors recommend investing no more than 5% of your portfolio in crypto, and sticking to the two most well-established cryptocurrencies: bitcoin and ethereum. According to the NextAdvisor Investability Score, bitcoin and ethereum are considered to be better investments thanks to their longer track records and long-term value growth, among other key factors. Heres how our score shakes out for 10 cryptocurrencies that are consistently among the top by market cap, excluding stablecoins, for reference:

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Bitcoin and Ethereum Prices Rallied This Week. It Wont Last, According to These Experts - NextAdvisor

Investment: Asset manager, financier, and cryptocurrency teacher Alexander Alexandrovich Ryabinin says the investment attractiveness of digital assets can be determined by analyzing inflationary and deflationary processes.

The expert shared his method with the editors of BeInCrypto. If you arent a math head, this might melt your brain. But try to hang in there.

This study shows how the attractiveness of a cryptocurrency can be calculated, thanks to inflationary and deflationary processes.

For this, a coefficient was developed. It is necessary to substitute all the project data into it in order to get the most valid value.

Coefficient:

A+B/(C+D)*(E*F)

Where

A current supply of tokens

B inflation

C current supply of tokens

D staking

E trading volumes within the platform subject to commission

F commission

Perfectly reflects this Biswap idea:

220.490.000+10%/60.000.000+35%*0.005=242,539,000/405.000=598.9

We took the current capitalization of 220,490,000

Added an estimated 10% additional issue

60,000,000 volume of tokens per day

Under 35% you can stake

0.5% of transactions are burned

In the case of the BSV, there are also deflationary measures that can be taken into account in the formula

Sometimes the staking offer is too small to be considered or not at all. Then we use the formula, removing staking.

An example is LRC:

10% apy

70% fee all trade for srakers

10% burn

0.5% fee trade buy and sell

1,374,513,896 circulation supply

240,000,000 volume trade per day

1,200,000 fee a day

840,000 fee for staker a day, 25,200,000 a mouth, 302,400,000 a year

120,000 burn a day, 3,600,000 a mouth, 72,000,000 a year

1,374,513,896/72,000,000 = 19

1,374,513,896/72,000,000+302,400,000=3.6

You can substitute different data. The main thing that must be observed is that inflationary factors are in the first part of the coefficient, and deflationary factors in the second.

Thus, we get a coefficient that reflects the advantage of deflation over inflation. After analyzing the sector (each asset), we can get the average ratio. And due to this, to understand what assets stand out from the sector.

For example, after analyzing the sector of centralized exchanges from the TOP 100, it became clear that the average value is 20.

Here are the rates for the projects:

BNB 20

OKB-15

FTT-17

KCS-20

HT-25

LEO-105

We can conclude that attractive coins for investment will be OKB and FTT, as their ratios are below average. LEO is not an attractive investment. The rest are neutral.

This does not mean that these projects will benefit in the short term. Rather, on the contrary, these coins will quickly give a small profit. So, the LEO coin is growing faster than the rest in the moment. But if you look after a long period of time, then it will lose to investments with a lower coefficient.

This is due to the fact that this coefficient shows how quickly the supply of coins will decrease. Deflation largely reflects supply constraints. But it is worth noting that you cannot rely solely on this coefficient. Since it reflects only the growth / reduction of supply. The demand factor must also be taken into account.

The previous coefficient reflects the internal economics of the project. How will the supply of coins be reflected in a year, for example.

Now, we need to consider the external demand for the coin itself. After all, by combining these 2 indicators, we can understand how attractive the project is for investors and future profitability (at least through a reduction in supply in a year there are 10% fewer coins, demand is good, which means that at least 10% growth can be predicted fundamentally).

So, how do we calculate the second coefficient:

A/B

Where:

A current market supply

B trading volume

For example, lets analyze BSW volume a day:

220.490.000/60.000.000 = 3.5

We do the same with other coins.

GNO

2.579.588/4.535.631 = 0.5

XLM

25,000,000,000/161,474,917 = 1548

RUNE

330.668.061/92.843.985 = 3.5

LRC

1.374.513.896/70.493.337= 194

Based on the analysis, we can conclude that the most interesting coins for investors are GNO, BSW and RUNE.

Now lets analyze for centralized exchanges.

BNB

163.276.974/1.030.589.981 = 0.6

LEO

953.954.130/7.004.759 = 130

FTT

135.473.350/62.725.740 = 2

KCS

98.379.860/4.197.593 = 22

HB

154.409.022/24.103.685 = 7

OKB

60,000,000/9,630,463 = 6

Here we already have 2 FTT and BNB leaders, 2 good indicators from HB and OKB, the rest are outsiders.

As a result, we got 2 good ideas. FTT is low in both ratios and OKB with excellent deflation and strong demand.

You can add a coefficient for summing up the results:

A*B

Where:

A offer coefficient

B demand factor

Then we get:

BNB 20*0.5 = 10

FTT-17*2=34

OKB 15*6 = 90

Due to the large demand, BNB wins. But it is worth noting that the demand is floating, today there is, but not tomorrow. That is, in the short term, this calculation takes place. But in the long run, things can change.

As an example of historical confirmation, we can take the 2021 cycle and CAKE with its excellent deflationary measures. From February to high.

CAKE has more than quadrupled.

The rest of the decentralized exchange market grew by an average of 150%.

The exceptions are LRC and RUNE, which grew about the same. But if you look, their deflationary measures are just as good. LRC 3.9. RUNE 11. And the demand for these coins (volumes) was excellent.

Got something to say about investment in cryptocurrencies or anything else? Write to usor join the discussion in our Telegram channel. You can also catch us on Tik Tok, Facebook, or Twitter.

DisclaimerAll the information contained on our website is published in good faith and for general information purposes only. Any action the reader takes upon the information found on our website is strictly at their own risk.

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Investment: How To Calculate The Attractiveness of a Cryptocurrency - BeInCrypto

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The downturn in cryptocurrencies is expected to fuel a wave of consolidation in the crypto sector during the second half of this year and into 2023, according to Needham.

Valuations for public crypto companies have fallen by about 70% this year, senior research analyst John Todaro told Barrons. The sector is also in the midst of a crypto crash, which has wiped out about $2 trillion in value in the past several months. This means crypto companies are cheaper now than they were a year ago when the sector was in the midst of an upturn, Todaro said.

This could present an opportunity for a traditional company to get their foot in the sector at a lower valuation than they couldve six to nine months ago, Todaro said.

Traditional, or non-crypto-native, companies that have been active crypto acquirers include Animoca Brands, the gaming investment company, which has made three acquisitions in the crypto space, Todaro said in a June 22 note. In May, the exchange operator Cboe Global Markets closed its buy of Eris Digital Holdings (ErisX), which operates a U.S.-based digital asset spot market. According to Todaro, other potential strategic buyers include investment firm CollinStar Holdings; Deutsche Boerse, which operates the Frankfurt Stock Exchange; and online broker Robinhood Markets (HOOD).

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Crypto mergers represent a tiny chunk of the overall deal market. According to Dealogic, 14,667 global announced mergers have totaled $2.2 trillion as of June 22. This compares to just 43 crypto transactions valued at about $6 billion for the same period. The biggest crypto transaction this year is the merger of Coincheck, a Japanese exchange, with special purpose acquisition company Thunder Bridge Capital Partners IV , which Dealogic values at $1.75 billion.

While the downturn represents an opportunity for traditional buyers, Todaro anticipates that much of the dealmaking will be crypto-to-crypto. The most acquisitive companies will likely be the exchanges, he said.

Coinbase Global (COIN) has been a leader in buying up businesses, Todaro says. Since it was founded in 2012, the exchange has scooped up 26 companies valued at over $800 million, Todaro said.

FTX, a crypto exchange, has been active recently, agreeing to buy Canadian exchange Bitvo last week, while its affiliate FTX US acquired stock clearinghouse Embed Financial Technologies on Tuesday. FTX is also providing a $250 million credit facility to BlockFi.

Kraken, a smaller rival to Coinbase, has completed a dozen deals, while the crypto exchange Binance.US has done eight acquisitions, Todaro said. Then, theres Galaxy Digital Holdings , which isnt an exchange but a crypto-focused financial services firm; it has completed three acquisitions since it was formed in 2018 and has a pending deal for crypto-custody specialist BitGo. The four transactions are valued at more than $1 billion, Todaro said.

Todaro also expects more distressed mergers since its harder for businesses to raise money now compared to 2021, he said. Some crypto companies have already started to work with legal firms on restructuring, he added. Celsius Network, the crypto lender that suspended customer withdrawals last week, has hired restructuring attorneys from law firm Akin Gump Strauss Hauer & Feld LLP to advise on possible solutions for its debt issues, The Wall Street Journal reported last week. Celsius and Akin Gump didnt immediately respond to requests for comment.

Although more complicated than traditional M&A, restructuring represents an attractive opportunity to buy companies at a deep discount, Todaro said.

Write to Luisa Beltran at luisa.beltran@dowjones.com

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The Cryptocurrency Crash Could Lead to a Wave of M&A - Barron's