Worlds First Cryptocurrency Grades 💯 By Weiss Rating Agency
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On today's show:
An update on the growing of the Lightning network
A quick look at yesterday’s price dip
And the first ever set of cryptocurrency grades from a ratings agency will be released this Wednesday the 24th of January
Story - Lightning Watch 0:48
https://lnmainnet.gaben.win/#
https://p2sh.info/dashboard/db/lightning-network?orgId=1
https://docs.google.com/spreadsheets/d/14EN_vpbeLeQNFTNJ8DJbayZX33wlRINW-oQfJjveScI/edit?usp=sharing
Despite these stats, use of Segwit remains at 12% of all Bitcoin transactions on the main network.
I personally would expect that to increase as more wallets and services adopt Lightning.
While the Lightning stats are great, as far as I understand it, there’s no way for us to know how much value is being transacted because the signatures are being privately swapped between the two parties.
Story - Weiss Will Begin Rating Cryptocurrencies On Wednesday 4:30
https://weissratings.com/
Martin Weiss is the founder of Weiss Ratings.
It’s a financial rating agency so they research stocks, funds, banks etc and do their best to give an objective rating in terms of the risks and rewards.
They are set to become the first rating agency in the world to release Bitcoin and Cryptocurrency gradings.
According to this countdown on their website, they are set to release their first batch of tradings on Wednesday morning.
So they have built a computer model that grades each cryptocurrency by computing a whole range of factors to arrive at an overall rating.
They are going to arrive at this overall rating by grading in 4 different categories.
Risk index, how low could it go
Reward index, how high could it go
Technology index, looks at the source code, scalability, robustness, flexibility
Fundamental index, adoption and security. The reality test, are people using to use it, is it performing in the real world.
The result is that each cryptocurrency will get a grade from A to F like every other financial instrument that they grade.
But bear in mind they have built a computer model that is going to be constantly adjusting the grade as it gathers new information.
So those are the facts, what are the implications?
I think this is going to be very popular because it’s a shortcut through the ungodly amounts of information in the cryptocurrency space.
While no one should rely on this grading as the one piece of information, I am certainly going to include it as one data point to check when doing research.
The downside I suppose is that BECAUSE so many people will be looking at this grade, it is likely to have a disproportionate amount of power.
While Weiss Ratings publicly states that it does not accept financial compensation from the entities it rates, unlike Standard & Poor’s, Moody’s, Fitch and AM Best there are other possible attack vectors.
For example, what’s the stop them loading up on A grade coins prior to the release of their research?
They can say they are not doing any trading but there’s no easier market to trade anonymously than crypto.
Early access to rating information gives them a chance to get positioned in the market before anyone else.
I’m not questioning the integrity of Weiss Ratings specifically, I’m just pointing out an attack vector that would apply to any such rating agency.
I will be reporting on the results anyway, however if you want the news the instant it is released then go to this page:
http://finance.weissratings.com/crypto/
Enter your email and they’ll send you a message when it’s ready.
I’m going to make a prediction and say that EOS is going to get an A or a B.
On Wednesday we’ll see if that prediction is right or wrong.
Story - Price Dip Yesterday
The recovery was briefly interrupted by a price dip yesterday.
As far as I know it was just some nonsense about Indian banks starting to close accounts that were sending and receiving money from cryptocurrency exchanges.
The overall market cap has stabilized now and there’s a mix of single digit gains and losses in the top 20 coins.
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Thanks Chris for this post. I want to comment on the Weiss ratings segment.
I don't see the trouble with 'insider trading'. To be blunt, I think this is a common economic fallacy.
The anticipated response goes something like: 'But how can that be fair?!!!'.
A free market is nothing if it isn't a competition to see who is better informed.
In a free market, were we to have one right now(because we don't), it would only be a problem for Weiss to buy before everyone else if Weiss had contractually agreed not to. Which would be fraud.
Otherwise, if everyone expects Weiss to buy their own stock/tokens/coins before announcing good news, they a) would factor that in to their imminent investment, and b) should also know that Weiss still needs to attract investors. So it should be expected that Weiss itself has bought to the maximum extent it sees fit.... without turning off potential investors.
In a free market any business would have to pay attention to investors. Unlike in today's interventionist markets, where subsidies(funded through wealth confiscation schemes) undermine the incentives to do so.
This insider trading economic fallacy is one of the more enduring ones and one of the most effective in propping up continued concession to government intervention in markets.
Good points. Another factor that would discourage a ratings company from front-running its own recommendations, is that people would quickly catch on if there was a suspicious price increase just before they released their reports.
Excellent points. Well deserved an upvote.
insider trading a common economic fallacy? the manipulation of markets and cronyism is one of the hallmarks of capitalism !!
@clumsysilverdad
'Manipulation of markets' is only a problem in the presence of force or fraud. Otherwise each must rise and fall on his own merits.
The only way anyone evades falling due to his own bad decisions, in his business, is through protection from competition. This protection can only be granted in one of two ways: a) through voluntary subsidization of the failing business owners e.g. bailed out by family/friends, or b) through involuntary intervention i.e. the State confiscating(through the threat of physical violence) what belongs to producers. The latter happens for a price i.e. politicians are for sale. It is labelled 'Consumer Protection' but it amounts to the opposite.
So, just to re-iterate, manipulation of markets, per se, is fine. The problem, as always, is the legalized threat of physical violence, used to stifle, if not eliminate, open competition.
Cronyism, per se, is different. It is a label for Protectionism i.e. the process of State Capture, where the State promises to play the role of Ultimate Consumer-Protector but never ceases - on being appointed by the unsuspecting consumer - to convert that role into Ultimate (Privileged-)Producer-Protector. Note how this perversion is baked into the cake where individuals are not exposed to open competition. It's why we naively keep re-appointing the next political angel to represent the consumers' best interests, running into a hard brick wall, and then doubling-, tripling- and quadrupling-down until there is nothing left of a recognizable middle-class.
Finally, 'Capitalism' is a word that is fraught with double-meaning. I prefer to be clearer and to instead explicitly specify, 'Crony Capitalism' or 'Laissez-Faire Captialism'. If you do this whenever you would have otherwise used the term 'Capitalism', the picture becomes much clearer very quickly. If you are unable to make this distinction, or - for whatever reason makes sense to you - you choose not to, you are a prime candidate for capitulating to - and perpetuating - the lie that governments are there to protect consumers. They are not. They are there to protect some producers at the expense of everyone else in the market. And the producers they end up protecting just happen to be the least competent from the more competent(or at least those who are prepared to risk becoming more competent at their own expense). you only have to look at the language... competent i.e. any government who is pro- open 'competition' needs, by definition, to continually fight to limit its own role in markets i.e. in setting standards or appointing standards bearers.
Of course, this - the State playing the role of consumer-protector - amounts to the exact opposite of consumer protection. It is categorically exposing the consumer to the greatest risk whilst making it increasingly impossible(illegal) to mitigate that exposure.
the idea of a free market itself is a utopian idea, along with the illusory protection of the commons thu privatizing in libertarian thought. markets are ubiquitously being corrupted all the time, knowledge is power, and will continually be co-opted and coerced into a smaller group of hands unless the polis demands otherwise, it is the continual struggle in benighted civilizations which may never end.
@clumsysilverdad
'the idea of a free market itself is a utopian idea'
I think that's because many people assume a free market is something one has(handed down from on high), rather that something one does(bearing risk and being free to mitigate it).
'along with the illusory protection of the commons thu privatizing in libertarian thought.'
Don't know what libertarian thought you've consulted, but protection of the commons is illusory, for sure. 'Commons' means exclusive ownership when applied to something everyone owns... which, of course, is an oxymoron. There is no such thing.
In libertarian thought, 'privatization' simply means removing ambiguous laws, so that laws can be more consistently enforced. The bedrock of Protectionism/Cronyism is ambiguous, convoluted, overly-verbose legalese. These are the laws which strangely can't be interpreted and hence need a wise, beneficent clique of overlords to interpret it for the rest of us hapless, forlorn and otherwise-lost souls.
interesting, thanks
I watch your content on Youtube and decided to join you on Steemit! Awesome Videos! Thank You for the information Chris.
I’m also a huge fan of EOS! I would love to hear your thoughts and the future of Steem and Bitshares. I have this feeling that block.one will port them in some new iteration on top of EOS. Then an airdrop to STEEM and BTS holders might make sense? Also, what do you think will happen close to the end of the ICO. I think there will be a lot of sell pressure from those who don’t trust the distribution process after the ERC-20 tokens get frozen or don’t want to bother removing them from an exchange.
It's not Block.One's decision to move BitShares and Steem to EOS. Yes they could become EOS apps and the BTS and STEEM tokens would become EOS based tokens. That's not as simple as it sounds IMO because all the Steem and BitShares witnesses would lose their jobs.
I don’t think Dan Larimer would want to negatively effect the Steemit/Bitshares communities so perhaps he would move in a different direction for dApp development. He has stated that he is creating EOS for himself to use and develop on though. I can only assume he has plans in the works after EOS is stable and running. The other thing to consider is it makes it easy for any developer to create a similar social network or trading platform on EOS so we should see competition arrise at some point.
ah man, everyone loves to be graded ! (?) (-:
what, you mean we all have to pay for this sh$t /// what happened to free? (-:
I don't understand how you can value something but then not be willing to pay for it. I think the price they are asking is fair and I am going to sign up. The value of the information far exceeds to the price in my eyes.
i'm just highly skeptical on this claim on "knowledge" at this point, but thanks for your info ... seems like a scam within a market dripping with scams. peace
Thanks for including the information on the rating company. It's important for people to understand how to use that information.
yeah, i mean, does anyone have much of a clue how to grade crypto ??
My concern on the rating agency is how much power they have gotten in the regular financial markets. Although it is good to have an investment grade vs non investment grade segmentation in the crypto space, it will be hard to judge based on the possibility of biases that can exist. Thanks for the information!
yeah, they did such a crack job in 2007 !! (-:
the crypto ratings are so hard to be found in their menu and such :(
thank you for sharing this..
If 'spamming' the BCT network currently is defended by the relatively cost of TXN's, is the Lightning implementation not re-opening this vector of 'attack' Chris?
Typo: BTC of course, just making sure you're awake!
Just edit your comment to make the correction. If you don't see the
Editbutton, then try a different interface. I know that the original steemit.com and busy.org both support comment editing.Correction: relatively HIGH cost