Market Dashboard

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In the Market

The market went on a rip this week on the back of positive news. Volumes began to increase while correlations decreased signaling a recovering market. The rally was broad-based with the DCEX Index and the DCX index jumping by 20.9% and 14.9% respectively. Within the different layers of the crypto economy, the Protocol Layer (DCPX Index) was the star, rallying by 16.6%. The Cryptocurrency (DCCX) Index and Token Index (DCTX) closely followed behind with an increase of just over 13%.

If you held either TenX (PAY), a crypto debit card, or Stellar (XLM), an extremely cheap remittance network, you would have been a very happy camper with a return of 68.4% and 62%. TenX’s incredible rally was largely due to internal anomalies across some Korean exchangesand some potential partnerships that are in the works. Stellar’s stellar performance (pun intended) was due to some very good news coming out this week: 1) a well funded stable coin project using the Stellar network; 2) a briefly lived announcement by Coinbase that it would be listing Stellar, and 3) the first-ever crypto to be Sharia-friendly. On the dark side of performance, VeChain (VEN), a distributed business ecosystem, and SelfKey (KEY), a blockchain-based identity system, slid by a painful -21.3% and -22.9% respectively.

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In The News

BitPay granted virtual currency license by NY regulator  Reuters

Summary:  The New York Department of Financial Services (DFS) said on Monday it had granted the first virtual currency license to bitcoin payments processor BitPay. With the BitPay approval, the DFS has now approved ten firms for virtual currency charters or licenses for the state of New York – Square, Xapo Inc, Genesis Global Trading Inc, bitFlyer USA, Coinbase Inc, XRP II and Circle Internet Financial, and charters to Gemini Trust Co and itBit Trust Co.

Why it matters: BitPay is a payment processor for Bitcoin and Bitcoin Cash. The company specializes in setting up merchant accounts to accept cryptocurrency payments. This process will make it much easier for users to skip banks and use cryptocurrency as a means of payment.

U.S. Congress Strikes Positive Tone on Cryptocurrency in Latest Hearing CCN

Summary: A congressional hearing before the U.S. House Committee on Agriculture today struck a positive tone towards the impact that cryptocurrency and digital assets can have for the economy and processes.

Why it matters:  Positive signs coming out of Washington suggest that crypto has the possibility of becoming more mainstream and thus a viable investment option.

How Russian Spies Hid Behind Bitcoin in Hacking Campaign New York Times

Summary: Cryptocurrencies fell under the global spotlight this week, as new evidence surfaced indicating that Russian hackers used Bitcoin as a payment instrument to wage cyber attacks on Hillary Clinton’s 2016 presidential campaign. An indictment released Friday describes hackers’ methods in acute detail, highlighting how cryptocurrencies have become both a tool and a challenge for intelligence agencies in cross-border investigations.

Why it Matters: The Bitcoin network allows anyone to move millions of dollars across the world without any in-person meetings, and without the approval of any financial institutions. However, American investigators were able to use the blockchain to go back and identify some of the transactions that Russian agents made which shows that Bitcoin is secretive but not as secretive as many may have assumed.

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Regulated Crypto Custody Is (Almost) Here. It’s a Game ChangerBloomberg

Summary: There is currently a lack of qualified custodians in the crypto space, however, scores of crypto-custody service are working with regulators to become qualified custodians. Many of these services are now almost ready which is expected to have huge implications for the market’s future and bring in institutional investors.

Why it matters: Such projects would pave the way for vast tracks of investors to expand into crypto, potentially reviving prices in the markets which have tumbled in recent weeks. Regulated crypto custody would also allow more institutional buyers — such as hedge funds and pensions — to invest in Bitcoin, Ether and a multitude of other coins. Retail brokerages would also have a safer way to let clients add crypto to portfolios stuffed with stocks and bonds.

BlackRock is evaluating cryptocurrencies, CEO Fink says Reuters

Summary: Blackrock CEO and asset-management magnate, Larry Fink, said Monday that Blackrock had assembled a working group to look at possible implications of cryptocurrencies, such as Bitcoin on the firm. While Fink also commented that Bitcoin “does not see massive investor demand. However, with more than $6.3 trillion in assets under management, at least some of Blackrock’s investors are curious about the emerging tech.

Why it matters: Any move to invest in cryptocurrencies or to use blockchain by BlackRock would mark a pivot for the company and a major institutional endorsement for the insurgent technology.

Knowledge Corner

HashPower – A Documentary on Blockchain – Patrick O’Shaughnessy, CEO @O’Shaughnessy Asset Management

Summary: One of the best introductions to crypto we’ve run into. The podcast is clear and not overly technical.

Interesting part: Why does value accrue in crypto? episode 2, 7:43

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The Token Classification Framework – Thomas Euler, Founder @ Attention Econo

Summary: There are multiple angles from which you can look at tokens which makes classifying crypto very challenging. In this piece, the authors have managed to identify the various token types, summarized their main characteristics and included helpful examples.

Interesting graphic:

An Introduction to Cryptoassets – Jeremy Gardner Partner @Ausum Ventures

Summary: A nice historical overview on the evolution of the crypto economy.

Interesting chart:

Why Decentralization Matters – Chris Dixon Partner @a16z

Summary: A helpful explanation of how blockchain relates to the “third era of the internet.” It’s also one of the more influential pieces of writing in the space. Very accessible by any reader.

Interesting quote: “Decentralization is a commonly misunderstood concept. For example, it is sometimes said that the reason cryptonetwork advocates favor decentralization is to resist government censorship, or because of libertarian political views. These are not the main reasons decentralization is important.”

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