- Traditional Market Overview
- Crypto Market Overview
- Top 4 Cryptocurrencies (by Market Cap) Outlook
- Altcoin Analysis
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Traditional Market Overview
The traditional markets are at all-time highs. And quantitative tightening has been reversed in the US. The Russel 3000 has recently met new all-time highs. However the Russel 2000 indicates weakness in its smallest 2000 companies. Having said that, the it is trending up at the time of writing.
The fed has signalled a pause in rate changes over early 2020. This means stability in traditional markets at these prices is likely for two or even three quarters of 2020, despite the bearish fundamentals across the board. And so all may not be as it seems, the fed has been supporting interbank-lending via the ‘repo markets’. The Fed has printed $213 billion in repos and $336 billion for asset purchases in the blink of an eye, and the Fed has promised to panic-print another $200+ billion in repos and another $300+ billion in asset purchases, for a grand total of over $1 trillion in panic-money-printing. Other than the mis-management of the events preceding and proceeding the original 08 crisis, the likely cause of this money printing is that a large US bank has become insolvent.
Both the pattern of behaviour and rhetoric from the fed is very reminiscent of them shortly preceding the 2008 global financial crisis.
Its not just the american banks that have shown weakness this year, Chinese and European banks are failing too. Once a giant of global banking, Deutsche Bank, has been hit hard with losses and stock price falls. Tumbling from over $140 at its peak in 2008 to just $6.44 in 2019.
Gold markets have been uncharacteristically tradable and has been on an up-trend but looks set to confirm a reversal in the first quarter of 2020 and stay bearish up to the last quarter.
If I were to pigeon hole 2019 crypto market into one market-cycle phase it would disbelief. Making 2020 Hope & Optimism. This year has been one of smart money and throughout 2020 we will inch closer and closer to the time of dumb money. The time to be taking profits.
Several large events are happening, two of which could be chain-breaking. These events are, the rollout of ETH 2.0 and Cardano’s launch of the Shelly main-net and . The ETH 2.0 launch, has the potential to break any project using the chain that become incompatible after the upgrade. This could happen due to potential bugs and oversights.
A few strong alt-plays have emerged with under-spoken momentum in their work. We will discuss these in detail later in the article. Transaction and contract privacy will be the buzzwords for 2020. One of the largest problems for most cryptocurrencies, including Bitcoin. If someone knows your public address, they can access all records of transactions conducted using it.
Top 4 Cryptocurrencies Outlook
This is a quick overview of how the top 4 cryptocurrencies have performed and how we think they are going to perform going forward into 2020.
Bitcoin – With the halvening happening early 2020, we expect the price to bottom any time between December and January and be no lower than $5000 and no higher than $6500. For the rest of 2020 we expect a bull-run up to the all-time-highs of December 2017, initiated by a succession of higher lows over the course of around 8 weeks with the daily lows raising by about $2200.
Ethereum – Over the last year the ETH price is slightly down, this slight move down looks all the worse when compared with Bitcoins year change. all-in-all 2019 has not been good for Ethereum. Defi is adding supply pressure to ETH via lockups for crypto backed loans. Also ETH 2.0 will add further lockups via the introduction of staking. However the switch-over will cause uncertainty (as mentioned in the overview).
XRP – Has been bleeding out over the year in both fiat and Bitcoin valuations. A polarising crypto, the leadership of XRP has been disappointing, its status as a security is unclear, this is a huge problem. As the ’bank’ coin they should really have addressed this head-on and sought clarity from the SEC or designed the tokenomics to be more compliant. We do not see xrp performing well throughout 2020. Despite all this it is likely that xrp could have another short term pump, but its nothing other than a good place to get out if u have a position in xrp currently.
Bitcoin Cash – BCH is up year-on-year in both fiat & Bitcoin valuations Although people berate Roger Ver Bitcoin Cash does have one advantage over most other crypto – it does what it was designed to do. Having said that it is not Bitcoin. It will never be. But it works as digital cash, has an edge with branding and has cheaper fees.
The best performers for the last year when taking both fundamentals and price into account have been chainlink, tezos, binance coin & enjin. This has been because of chainlinks partnerships, binance coins IEOs and its tokenomics, and again partnerships with large companies like samsung propelled enjins price to new all-time-highs.
Listed in the next section is each alt project that we think will perform best in 2020 and what sets them apart from other projects. The first paragraphs of each of these analysis is taken verbatim from the project as i believe that the project is best positioned to describe their design & mission.
iExec- Blockchain based decentralised cloud computing
iExec is a decentralized marketplace for computing resources. It allows individuals and enterprises to monetize their applications and datasets, and to trade computing power.
Partnered with IBM & Intel
iExec addresses the needs of all the decentralized businesses:
• DApp providers can perform off-chain computations on demand.
• Application providers can radically lower the computing costs of their decentralized applications by using a safe, robust and reliable infrastructure.
• Data providers can expand their potential market size by integrating their services with the iExec marketplace.
• Server providers can monetize underused computing resources and increase the return on investment on their existing infrastructure, by seeking higher profits in providing their servers in the iExec marketplace.
iExec is built upon the work our team members have done at the INRIA and CNRS research institutes in the field of Desktop Grid computing since 2000.
Chainlink – Blockchain-agnostic decentralised oracle service
The Chainlink network provides reliable tamper-proof inputs and outputs for complex smart contracts on any blockchain.
Working with swift on connecting banking partners to blockchains, google and more
Chainlink provides solutions for all sectors of decentralised and non-decentralised business:
• Links any data to any contract
• Links any contract to any participants banking provider
• Builds & serves public verified datasets like market data or even random number generators. When programming the use of properly random numbers can be critical in some situations.
• Allows companies or individuals to build apis and sell their data-sets to smart-contracts
• Allows companies or individuals to build network nodes and participate
Enjin – Non-fungible tokens
Enjin builds a suite of user-first blockchain products that enable anyone to easily create, manage, distribute, and integrate blockchain assets.
• Provides both fungible and non-fungible tokens with one smart-contract
• Enables users to use, trade, destroy, upgrade, combine, rent, loan, and lose
• Atomic swaps of any amount of tokens in just two simple steps.
• Charge a transfer fee whenever your items are traded or sold on third-party marketplaces.
• Enable players to use and level up their characters and items across different games.
Partnered with Unity, GoDot, Samsung & Microsoft
0x- Frictionless exchange
0x is an extremely versatile project. Its an open protocol that enables the peer-to-peer exchange of assets on the Ethereum blockchain. Using it you can create defi protocols, marketplaces for digital goods, trading desks, trading bots, portfolio management software. Anything that requires access to an exchange or exchange data to work.
Can be utilised by developers to create many different products including:
• Prediction Markets
• Non-custodial trading
• Decentralized Loans
• Stable Tokens
• Games & Collectables
Enigma – Private transactions
Enigma is building a decentralized, open-source protocol that lets anyone perform computations on encrypted data, bringing privacy to smart contracts and public blockchains. Enigma turns ordinary smart contracts into “secret contracts”, allowing developers to build thousands of new and valuable privacy-preserving solutions. Enigma’s mission is to improve the adoption and usability of decentralized technologies, for the benefit of all.
First founded and researched at MIT in 2015. Now Enigma are working with Intel, iExec, the Enterprise Ethereum Alliance and Hyperledger Avalon.
The run up in bitcoins price was both unexpected & unprecedented, the retracement to the $6ks, not so much. Its been a real roller-coaster this year but we are still on course as per the stock to flow model. There may not be new all time highs until 2021 but that doesn’t mean now is a bad time to start dollar cost averaging into Bitcoin if you haven’t (seek counsel from your financial adviser first) infact this may be the last time we see prices this low. Whatever happens, expect volatility, and an EOY price of atleast $13k.
When it comes to alt projects, allot of activity has been happening under the surface in 2019. However, in terms of price most alt-coins have bled out this year, but there are a few alts that – in spite of a bear market – have outperformed bitcoin at points in the year. This has been because of solid tokenomics, home-name partnerships and good basic fundamentals, like functioning products and good teams who consistently contribute to the project.
Our plan for the next year is to invest in the projects that are both undervalued and partnered with large business, although we dislike all aspects of centralisation and crony-capitalism, keeping tabs on partnerships with large companies will pay off in the future. They will pick only the best projects to work with to lay the foundation of enterprise blockchain solutions.