KNOWLEDGESTREAM AT-A-GLANCE
Future of Cryptocurrency Trading
ABSTRACT
Future of Cryptocurrency Trading Who should trade How to trade and build a portfolio Exchanges Trading Bans Altcoins Trading vs. HODLing
PARTICIPANTS
OBJECTIVES
1. : Distill relevant trends and factors and identify relevant examples.
2. : Identify the range of needed capabilities and understand the feasibility of each.
3. : Create a capability roadmap priority of importance and feasibility.
4. :
End Date: Oct 30, 2018
CONTRIBUTIONS
ACTIVITY
81 Days
5 Themes
20 Contributors
501 Posts
180 Comments
107 Followers
OUTPUTS
4 Slide Deck
2 Video
THEME #1
Outside of the obvious(Whitepaper, Technical Team, Project Idea), what other questions do you ask when looking at a coin?
THEME SUMMARY
There seems to be a consensus of the values each of us looks for in a coin/investment.
- Does the project NEED blockchain to achieve its goal?
- Is there long term potential for the project vs the hype factor
A project must have a clear roadmap of what the goals are and the plan to get there if we are going to invest
Reasons for Avoiding Coins/Tokens
I never buy coins that seems to be the copy of other company that already exists, but with a blockchain approach.
Protocol changes are even worse. If the documentation or comments by the project imply that technical changes are coming down the road, there is significant exposure to holders that are not monitoring the situation on a very regular basis.
THEME #2
Bitcoin- The dominant coin
THEME SUMMARY
Bitcoin is still the "Gold Standard" of cryptocurrencies. At over 50% of the entire market cap, as it evolves, so evolves the Crypto markets.
- The majority of the panel seem to agree that Bitcoin has become a digital asset or storage of value more than a currency at this time.
- Market manipulation is still a big concern, whether "Pump and Dump" , early adopter whales or large miners can all influence the market unduly.
Issues to wider adoption
Given the nature of Crypto in general, I believe system of Tax Collected at Source is the best option for regulator. Exchanges can be legalized with proper Direct Reporting Mechanism which can enable auto reconciliation. of tax due vs collected and deposited.
The risk of attack increases also as Bitcoin becomes a more economically important as exemplified by the bitocin futures market and how someone could make a fortune by shorting the market and then attacking it.
Lifecycle of Bitcoin
Bitcoin is the just the first application of blockchain (with no real mass adoption in sight, more on it later). The market share of bitcoin is going to increase gradually since out of the 2000 odd alt-coins; only a few would survive beyond a limited period & scope.
Overall it reinforced my thoughts that we are in the first inning of a long game and that the patches to todays code (Offchain, grouping of transactions etc.) are bandaids that actually make the current blockchains worse.
The impact of bitcoin
Eventually, bitcoin will become true digital cash—which means it will be completely anonymous (thanks Lightning and future layers) and P2P. As this happens, centralized rent seekers (including the government) will need to come up with new ways to collect rent (and taxes)
Bitcoin is a bellwether for the health of cryptoassets since the market perceives it as digital gold. Since it's remarkably uncorrelated with traditional assets when measured against e.g. S&P , it's becoming a de-risking asset.
THEME #3
Breaking down the Top 50 Cryptocurrencies into Categories
THEME SUMMARY
The current top 50 coins/tokens do not show the excitement that some of the newer projects are generating, but a few will continue to lead us forward to the future
- A lot of disruption will occur at the enterprise level on private blockchains. Many current projects are being completed using Hyperledger
- Currencies are already in the top 50, Bitcoin is becoming moreof a storage of value. Will it scale and evolve is the question, or will another coin take on that role of microtransactions?
- Many exciting projects that look to disrupt categories like social networking and financial sevices are still very early in their maturity.
Categories ripe for disruption
I think a few major players will emerge in the payments space and there will be a main subset dealing with micropayments
Social networks are an incredible market as well. This social network Steemit have seen an incredible growth and adoption. It is like Youtube, in which coins are distributed to all people that engaged with comments, posts, likes, etc.
Categories with inherent issues
One category from the list, Privacy Coins, deserves its own attention. Governments all around the world may find it difficult to collect tax if people starts moving their money into privacy coins and keep doing transactions within different privacy coins.
Most of the other top-50 coins are uni-taskers, in which they try to "do" specific things on-chain. W
THEME #4
Technical Analysis
THEME SUMMARY
Technical analysis is a divisive subject in this space. Panelists were divided on the value added(if any) by the use of traditional TA in crypto investing.
- With daily trading volume in excess of $12 Billion, traders are not just relying on "gut" feelings to make these trade decisions.
- Outside factors including FUD, regulatory concerns, pump and dump groups, market manipulation makes use of traditional TA difficult, but not impossible if done correctly.
failures of TA
Those tools were designed for slow price changes and known markets, and should not be used for outliers like cryptocurrencies or other speculated companies like Tesla.
Technical Analysis of cryptocurrency based on volumes, RSI, market sentiments, patterns, etc can rightly point towards past incidents but its almost improbable to determine “short-term” future
THEME #5
The Use of Trading Bots, Arbitrage and other investment theories.