Enigma Weekly 24/10/2018 - Steady As She Goes

Enigma Weekly 24/10/2018 - Steady As She Goes

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  www.enigma-securities.io info@enigma-securities.io DISCLAMER: Theinformation contained in this note issued by Enigma Securities Limited is not intended to be advice nor a recommendation concerning cryptocurrency investment nor an offer or solicitation to buy or sell any cryptocurrency or related financial instrument. While we provide this information in good faith it is not intended to be relied upon by you and we accept no liability nor assume any responsibility for the consequences of any reliance that may be placed upon this note. Enigma Securities Limited is an Appointed Representative of Makor Securities London Ltd which is authorized and regulated by the Financial Conduct Authority (625054). 7/8 Savile Row London, W1S 3PE U.K. Tel: +44 207 290 5777 336 Rue Saint-Honoré Paris, 75001 FRANCE Tel: +33 1 42 33 02 05 Menachem Begin 11 Ramat Gan, 5268104 ISRAEL Tel: +972 3 545 3777 24 October 2018 The Enigma Weekly De-Coding Crypto Our Market View Steady as she goes…. The market has been unusually stable this week. In fact, after a volatile year, Bitcoin is now more stable than tech stocks such as Amazon and Netflix. With the exception of XLM, most names have hardly fluctuated more than 3 percent. Interestingly, while traders sit on their hands, rhetoric among the crypto world’s many self-professed experts has become more polarised. As famed bear Nouriel Roubini put it, “Bitcoin could go to the moon or zero.” Yet, must Bitcoin’s fate be so binary? We, at Enigma, believe the recent market stability shows that the truth lies somewhere in between. Like any new asset, crypto is experiencing teething problems, but that doesn’t mean it’s going away. Preferences are changing. ICOs have given way to STOs. Stablecoins are in vogue, with Circle and Coinbase the latest to launch a “USD coin.” These developments are paving the way for big money. The rest of 2018 promises further developments, with the launch of Bakkt and a possible ETF approval. As CNBC’s Brian Kelly argues, we could see an “Institutional Herd” arrive early next year. The recent inertia in the market would indicate we are now at a moment of reckoning. One outcome of the crypto slump has been a flurry of M&A activity in the space. As one analyst put it, low prices have caused an industry “land grab” for innovative technology, access to new markets, intellectual property, and talented employees. The message from these “land grabbers” is clear: Bitcoin is here to stay. Performance Snapshot as of 9am GMT 24/10 Name Ticker Wk Close Wk Change YTD Change Record High Mkt Cap Bitcoin BTC $6,498.760 -0.8% -53.9% $20,089.00 $112,922,448,944 Ethereum ETH $204.380 -2.0% -72.7% $1,432.88 $21,028,121,322 Ripple XRP $0.467 -0.6% -79.2% $3.84 $18,481,486,846 Bitcoin Cash BCH $449.480 -0.6% -82.3% $4,355.62 $7,741,934,049 EOS EOS $5.480 1.5% -37.5% $22.89 $4,900,399,896 Stellar XLM $0.244 6.1% -32.4% $0.93 $4,605,870,277 Litecoin LTC $52.480 -1.7% -77.2% $375.29 $3,085,160,214 Tether USDT $0.990 2.1% -2.0% $1.22 $1,998,078,007 Cardano ADA $0.074 -0.1% -89.3% $1.32 $1,944,160,312 Monero XMR $109.530 3.1% -68.6% $495.84 $1,789,484,782 TRON TRX $0.024 0.4% -49.1% $0.30 $1,551,745,272 IOTA MIOTA $0.501 -2.2% -85.8% $5.96 $1,371,198,317 DASH DASH $159.240 -3.6% -84.9% $1,642.22 $1,323,072,851 Enigma Research Lead Analyst: Aliya Itzkowitz aitzkowitz@enigma-securities.io
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  www.enigma-securities.io info@enigma-securities.io DISCLAMER: Theinformation contained in this note issued by Enigma Securities Limited is not intended to be advice nor a recommendation concerning cryptocurrency investment nor an offer or solicitation to buy or sell any cryptocurrency or related financial instrument. While we provide this information in good faith it is not intended to be relied upon by you and we accept no liability nor assume any responsibility for the consequences of any reliance that may be placed upon this note. Enigma Securities Limited is an Appointed Representative of Makor Securities London Ltd which is authorized and regulated by the Financial Conduct Authority (625054). 7/8 Savile Row London, W1S 3PE U.K. Tel: +44 207 290 5777 336 Rue Saint-Honoré Paris, 75001 FRANCE Tel: +33 1 42 33 02 05 Menachem Begin 11 Ramat Gan, 5268104 ISRAEL Tel: +972 3 545 3777 Chart of the Week Altcoins Poised for a Rally? If history is anything to go by we may shortly be entering ‘Altcoin Season.’ This time, a year ago, Altcoins such as Ethereum and Ripple increased exponentially in value versus Bitcoin. Granted, the market was in quite a different place back then, with some coins surging as much as 3000 percent in value between December 2017 and January 2018. Indeed, a more accurate comparison can be drawn with the 2014 bear market. In 2014, Altcoin market cap was down 86 percent over a 38-week period before it established a bottom and started to rally. Today, Altcoin market cap is down 85 percent in the last 36 weeks. Could a 2014-style reversal be around the corner? Altcoin bulls see reason to believe we may be poised for a breakout. The Altcoin market cap, which is calculated by subtracting bitcoin market cap from the overall crypto market cap, is close to all-time lows. Altcoin market cap appears to have hit a its lowest point in September, around the 78 billion level. Recently, this level has met frequent resistance, creating a head-and-shoulders pattern on the chart. This sort of pattern is a typical precursor to a rally. Whenever the price nears a new low it gets bid back up. This shows that traders acknowledge the assets should be trading at a higher price. Altcoin Market Cap Appears to be Bottoming Out Conversely, Bitcoin dominance is reaching peak levels. Bitcoin dominance has been steadily increasing all year and was as high as 58 percent in September. These levels are, in our opinion, unsustainable as the crypto market continues to mature. In recent weeks, developments on platforms such as Ripple prove that other coins have the potential to attract and rotate flows away from Bitcoin. Admittedly, the crypto market has not been around long enough to have firm, established, seasonal trends. That said, on a merely technical level, a potential inflection in bitcoin dominance, as well as altcoin market cap, both bode well for a possible year-end altcoin rally.
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  www.enigma-securities.io info@enigma-securities.io DISCLAMER: Theinformation contained in this note issued by Enigma Securities Limited is not intended to be advice nor a recommendation concerning cryptocurrency investment nor an offer or solicitation to buy or sell any cryptocurrency or related financial instrument. While we provide this information in good faith it is not intended to be relied upon by you and we accept no liability nor assume any responsibility for the consequences of any reliance that may be placed upon this note. Enigma Securities Limited is an Appointed Representative of Makor Securities London Ltd which is authorized and regulated by the Financial Conduct Authority (625054). 7/8 Savile Row London, W1S 3PE U.K. Tel: +44 207 290 5777 336 Rue Saint-Honoré Paris, 75001 FRANCE Tel: +33 1 42 33 02 05 Menachem Begin 11 Ramat Gan, 5268104 ISRAEL Tel: +972 3 545 3777 Currency of the Week XLM Stellar is, as the name suggests, this week’s star performer. Stellar (XLM), the sixth largest cryptocurrency, is up about 6 percent on the week in an otherwise largely red tape. The initial reason for the price spike is likely a rumour that Fidelity’s new crypto platform will use the XLM blockchain. This speculation is centred around Tom Jessop, a Fidelity executive who used to run a promising blockchain start-up by the name of Chain. The Chain project was recently acquired by the Stellar Development Corporation. Other boosts to Stellar sentiment this week include the listing of XLM on Coinsuper – a Hong Kong-based crypto exchange as well as reports that TensorTask will use Stellar to develop an Artificial Intelligence market. So, where does XLM go from here? A look at recent charts reveals that downside has not been sustained below the $0.184 level. In fact, XLM has bounced off this support level three times already. The repeated failure of bears to break this support level is a bullish indicator. Bulls believe the next breakout level for XLM could be $0.47. XLM has consistently found support at the 0.18 cent level The last time XLM outperformed the broader market was during the mid-August slump. During that period, Stellar remained within a narrow range whereas Altcoin rival Ethereum dropped 21 percent. Stellar’s outperformance at that time can be partly attributed to a rumour of a possible Facebook partnership. Though unsubstantiated, those claims could still be on investors’ minds. More recently, bulls were encouraged by Stellar’s partnership with IBM, announced last month. IBM launched its new money transfer business – ‘Blockchain Worldwide’ - on the Stellar protocol. The service uses Stellar to settle cross-border transactions in a matter of seconds.
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  www.enigma-securities.io info@enigma-securities.io DISCLAMER: Theinformation contained in this note issued by Enigma Securities Limited is not intended to be advice nor a recommendation concerning cryptocurrency investment nor an offer or solicitation to buy or sell any cryptocurrency or related financial instrument. While we provide this information in good faith it is not intended to be relied upon by you and we accept no liability nor assume any responsibility for the consequences of any reliance that may be placed upon this note. Enigma Securities Limited is an Appointed Representative of Makor Securities London Ltd which is authorized and regulated by the Financial Conduct Authority (625054). 7/8 Savile Row London, W1S 3PE U.K. Tel: +44 207 290 5777 336 Rue Saint-Honoré Paris, 75001 FRANCE Tel: +33 1 42 33 02 05 Menachem Begin 11 Ramat Gan, 5268104 ISRAEL Tel: +972 3 545 3777 ICO of the Week CRL ***Enigma Securities is pleased to announce exclusive allocations in several private sales*** If you would like more information on our ICO allocations please contact our team – info@enigma-securities.io The Proposal The Crown League (CRL) will enable fantasy sports fans to participate financially in the performance of their teams. Through tokens, members of the public can become part-owners in a fantasy team, thus profiting directly from real-life player success. For those unfamiliar with Fantasy Football in America, the basic concept is as follows: participants compose their virtual teams, choosing the best players, in their opinion, from several real-life NFL teams. The performance of the fantasy team is directly corelated to the results of those players during the season (e.g. yards thrown, passes completed by Tom Brady). Typically, people play with a group of friends, with each person creating their own team. Money can be contributed by participants with the total cash prize awarded to the person with the best performance at the end of the season. The Crown League aims to institutionalize this experience – transitioning it from social sports betting to a financial stake representing part-ownership in a virtual team. Hired professionals will select players for each fantasy team. 12 Teams will be created based on geographical regions so as to foster a shared experience. For example, the Crown League will host viewing parties in Atlanta, Denver etc for the matches that affect the standing of the various fantasy teams. Blockchain technology will allow for the league to be run efficiently (instant payments, player contracts etc.) and, most importantly, for people to buy ownership tokens in: 1) The Crown League or 2) The 12 Fantasy Franchises. Enigma Rating: BUY Fantasy sports is a massive market in the U.S. and has the potential to expand internationally. The business model could ultimately be applied to other sports with more global appeal, such as the other “Football” a.k.a. “Soccer”: the Champions League. Last year, Americans spent $33 billion on Fantasy Football. Comparing this to the $14 billion in annual revenue by the NFL reveals that, interestingly, fantasy sports are outpacing actual sports. Crown league presents an innovative way of monetizing this growing activity. In particular, the popularity of Fantasy football with millennials, particularly college-age males, could mean a large demographic overlap with cryptocurrency retail investors. We think, therefore, that the Crown League has higher-than- average odds of user adoption and engagement. The Team Dan Nissanoff, CEO, is a serial entrepreneur with success stories in the technology sector such as PartMiner. Joining him are Derek Siskin, a fantasy sports expert with 25 years of experience and Jeff Kaiser, Chief Content Officer, who worked for 20 years for national sports networks. Mike Levy, an advisor, formerly managed CBS Sportsline. Transaction Details Two tokens 1) CRL – the utility token of the league, which represents ownership in the league as a whole and 2) FSX – the Franchise stake tokens. **Pricing Details Being Finalized this Week** *CRL – supply = 2 billion tokens. 80 percent will be reserved in trust distribution to franchise owners over time. 16 million tokens will go towards the public offering. The CRL token will likely be issued as an ERC-20 token. *FSX - different tokens for each team - 10,000 tokens will be released for each franchise Roadmap 4Q18: ICO and launch of Active Token Trading / 2Q19 Technology Platform Completed / 3Q19: CRL Inaugural Season in Conjunction with 2019 NFL Season ***Details Subject to Change***
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  www.enigma-securities.io info@enigma-securities.io DISCLAMER: Theinformation contained in this note issued by Enigma Securities Limited is not intended to be advice nor a recommendation concerning cryptocurrency investment nor an offer or solicitation to buy or sell any cryptocurrency or related financial instrument. While we provide this information in good faith it is not intended to be relied upon by you and we accept no liability nor assume any responsibility for the consequences of any reliance that may be placed upon this note. Enigma Securities Limited is an Appointed Representative of Makor Securities London Ltd which is authorized and regulated by the Financial Conduct Authority (625054). 7/8 Savile Row London, W1S 3PE U.K. Tel: +44 207 290 5777 336 Rue Saint-Honoré Paris, 75001 FRANCE Tel: +33 1 42 33 02 05 Menachem Begin 11 Ramat Gan, 5268104 ISRAEL Tel: +972 3 545 3777 Regulation Watch Last week, the SEC launched a new initiative called FinHub. Finhub will support Crypto, Blockchain and Fintech Innovation. We, at Enigma, are encouraged to see U.S. regulatory bodies engaging with crypto, thus giving more legitimacy to the space. The move comes after significant pressure from the entrepreneur community in the U.S. For example, Michael Arrington, founder of Tech Crunch expressed his frustration at a recent Disrupt conference in San Francisco conference stating that, “The U.S. is losing out to the rest of the world on blockchain.” Key Dates October 26th – Decision expected from the SEC on nine Bitcoin ETF proposals November 5th – Possible roll-out of bitcoin ETF by Intercontinental Exchange (ICE), New York Stock Exchange's parent company What We’re Reading Cryptocurrency giants Coinbase and Circle form joint venture to boost adoption of dollar-backed digital coins – The “CENTRE Consortium,” as it’s being called, will establish standards for listing fiat currencies in a digital form. The group is aiming at mainstream adoption of cryptocurrencies known as “stablecoins,” which are backed by a government currency like the dollar. A stablecoin known as "USD coin," which Circle says is pegged 1:1 with the U.S. dollar, will be available to buy and sell on Coinbase’s popular trading exchange as of Tuesday. Bitcoin Futures Could Go Live on ICE's Crypto Trading Platform in December - The Intercontinental Exchange's upcoming cryptocurrency trading platform Bakkt will officially launch on December 12, pending regulatory approval. ICE announced that Bakkt could begin offering physically settled bitcoin futures contracts in December, marking the first cryptocurrency-related offering provided through the new platform. Bakkt will hold the bitcoins backing the futures contract in the ICE Digital Asset Warehouse, provided the Commodity Futures Trading Commission (CFTC) signs off. These futures contracts will be cleared through ICE Clear US, another subsidiary of the exchange, which notably owns the New York Stock Exchange. The Rise of Stablecoins: Less Fun Cryptocurrency, More Viable Money – Stablecoins, a class of blockchain-backed cryptocurrencies which operate by pegging their value to an extrinsic and identifiable source, have become vogue in the second half of 2018. Where companies and startups were flocking to the ERC-20 token model for ICOs in 2017 and the first part of this year, the stablecoin model is becoming an increasingly attractive proposition, particularly for investors exhausted from the ongoing bear cycle. Apple’s Steve Wozniak Co-Founds Blockchain-Focused Venture Capital Fund – Apple co-founder Steve Wozniak has been announced as a co-founder of recently launched blockchain-focused venture capital fund EQUI Global.. The new venture capital fund aims to change the concept of the traditional industry by enabling non-institutional investments, as well as allowing investors to trade on external crypto exchanges via EquiTokens. As Wozniak stated, the company’s mission is to “seek, support and fund the blockchain and tech stars of tomorrow.” Wozniak noted that the company has already partnered with “over 20 businesses” that have not been launched officially. Tether Withdraws More Than 25% of All USDT from Circulation – Tether USDT, has withdrawn almost 25 percent of all USDT from circulation. The number of USDT has fallen from around 2.8 billion to 2.008 billion. Tether has not issued any Tether (USDT) since September 21. As the Omni Explorer shows, Tether did not issue any new tokens in October. Instead, Tether Limited has sent a total of 690 million tethers (USDT) back to its treasury account, taking it out of circulation. Remarkably, most of the outflows were either on or just before USDT lost its value against USD. The USDT price slid up to $ 0.92.
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  www.enigma-securities.io info@enigma-securities.io DISCLAMER: Theinformation contained in this note issued by Enigma Securities Limited is not intended to be advice nor a recommendation concerning cryptocurrency investment nor an offer or solicitation to buy or sell any cryptocurrency or related financial instrument. While we provide this information in good faith it is not intended to be relied upon by you and we accept no liability nor assume any responsibility for the consequences of any reliance that may be placed upon this note. Enigma Securities Limited is an Appointed Representative of Makor Securities London Ltd which is authorized and regulated by the Financial Conduct Authority (625054). 7/8 Savile Row London, W1S 3PE U.K. Tel: +44 207 290 5777 336 Rue Saint-Honoré Paris, 75001 FRANCE Tel: +33 1 42 33 02 05 Menachem Begin 11 Ramat Gan, 5268104 ISRAEL Tel: +972 3 545 3777 US Department of Justice to Auction off 660 Bitcoins - The US Department of Justice (DOJ) is selling off approximately USD 4.2 million of the cryptocurrency acquired from various criminal proceedings. A USD 200,000 deposit is required to take part, with bidders needing to register their interest in the sealed bid auction by 31 October. The official bid for the bitcoins will take place on 5 November. Initially, six sets of BTC 100 will be put on offer, followed by one set of BTC 60. Crypto M&A is on a tear as deal-makers see opportunity in bitcoin's price slump - Merger and acquisition activity for cryptocurrency companies has more than doubled in the past year amid a 54 percent slump in bitcoin prices, according to JMP Securities and data from PitchBook. The value of tokens associated with start-ups remains correlated to bitcoin instead of the value of the actual company, which creates an "ideal opportunity for strategic acquirers," JMP Securities' Satya Bajpai says. The industry is in a "land grab" for innovative technology, access to new markets, intellectual property, and talented employees through M&A. “As soon as a company becomes interesting, they get bought — the deal size may still remain small, but the number of deals will increase because that’s the most viable and fastest way to grow in this environment,” Bajpai says. SEC Launches New Initiative Supporting Crypto, Blockchain and Fintech Innovation - The US government is slowly integrating cryptocurrency and financial technology into its regulatory ecosystem, adding legitimacy and more support for the space. The US Securities and Exchange Commission (SEC) announced that they are launching the Strategic Hub for Innovation and Financial Technology (FinHub).Led by Valerie A. Szczepanik, Senior Advisor for Digital Assets and Innovation and Associate Director of the SEC’s Division of Corporation Finance, FinHub will connect and update the public on SEC-related issues and initiatives dealing with distributed ledger technology including blockchain and cryptocurrencies, automated investment advice, digital marketplace financing and artificial intelligence. Billionaire Mike Novogratz’ Crypto Fund is Fidelity’s First Custodian Client - Galaxy Digital, a crypto merchant bank operated by billionaire investor Mike Novogratz, has become the first alpha crypto custody client of Fidelity Digital Assets. The partnership between Fidelity and Galaxy Digital is expected to lead to clients of the Novogratz-led firm to invest in the cryptocurrency market through Fidelity, similar to how prior to the launch of Fidelity Digital Assets, clients of Fidelity purchased cryptocurrencies like Bitcoin and Ethereum through Coinbase, a partner company of Fidelity. The infrastructure of the cryptocurrency market, specifically pertaining to the institutionalization of the asset class, has improved exponentially in the past nine months. Goldman Wades Deeper in Crypto, Betting on BitGo With Billionaire Mike Novogratz - Goldman Sachs Group Inc. and a venture founded by one of its former partners, billionaire Mike Novogratz, are investing in cryptocurrency custodian BitGo Holdings Inc., as the bank’s deep-pocketed clients keep asking about secure ways to hold those assets. Combined, Goldman Sachs and Novogratz’s Galaxy Digital Ventures contributed about $15 million to BitGo’s Series B fundraising, which brought in a total of $57.5 million, the start-up said. The endorsement from two firms with strong Wall Street roots may help BitGo attract more institutions and wealthy investors as customers. HTC launches its blockchain-focused phone, but you can only buy it in cryptocurrency - HTC's Exodus 1 comes with a secluded area kept separate from the Android operating system it runs on to keep a customer's cryptocurrency safe. The blockchain- based phone is part of HTC's shifting strategy regarding smartphones, which will prioritize software and intellectual property. It is available for pre-order at a price of 0.15 bitcoins or 4.78 ether tokens, which translates to about $960, and is expected to be shipped by December. Until next week - thank you for reading. Please reach out to info@enigma-securities.io with any questions.