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Streaming Tokens Dominate Market as Bitcoin Whale Trend Signals $60K Adversity

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Streaming tokens are performing exceptionally, meanwhile, Bitcoin is stuck under $60K. To exacerbate Bitcoin’s situation, whale transfers to retailers suggest the onset of a short-term bear trend.

Since Bitcoin topped $60K to reach an ATH, the digital asset has found it hard to retain profits above this. Consequently, the retracement to the $55K regions, perceived temporary, bulls have been unable to find a way to the $60K levels. Meanwhile, for streaming tokens, the situation is much more positive.

The largest cryptocurrency in the world has struggled to come out of a tight range between $54K and $58K. Even with comments from FED Chairman Jerome Powell that Bitcoin was a substitute for gold, there has been marginal price change. And according to Glassnode data, the dampening of the bull rally is a sign that it is in its last stages.

Source: Glassnode

Retail Investors in Total Control

On-chain data from the firm suggest that there is a wealth transfer from whales to retail investors. The data shows that since March 2018, addresses with 1 BTC or less have been holding and accumulating. Furthermore, there was a dramatic increase of addresses holding 0.1 to 1 BTC after the March 2020 Thursday sell-off. This according to the firm is a sign of willingness to HODL through volatility. In comparison, in whale addresses, there has been little accumulation. The report noted:

“Interestingly, whilst we have continued to see small holder accumulation, larger wallet holdings (>100BTC) are relatively flat on net over the past three years…In total, this group currently hold 62.62% of the BTC supply and have increased their total stake by 0.87% over the past 12 months.”

The data is backed by a research report by JPMorgan Chase. As we reported, the investment bank last week revealed that retail investors have been out buying institutions in the last three months. While admirable that retailers are dominating, it is whales and institutions who hold the power to move prices. This then could among the reasons prices are stagnant.

Streaming Tokens Stun

And it is not in Bitcoin alone that retailers are dominating, their influence is being felt in streaming tokens. In contrast to Bitcoin’s performance, streaming tokens are soaring and setting new highs. Streaming tokens are tokens related to music, video and gaming. This is an emerging market taking advantage of the huge audience exposed to the entertainment industry. As cryptocurrency adoption grows, these tokens have become some of the most sought. Some of these, have in recent months and weeks explored new levels. Theta (THETA) which has been leading the way has in the last few hours reached new highs. After adding over 15% to its value, at $11, the token is looking to set a new ATH.

Audius (Audio) has also been a notable performer with a price change from $0.3396 to a new high of $2.0 in the past 30 days.

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John Kiguru

Kiguru is a fine writer with a preference for innovation, finance, and the convergence of the two. A firm adherent to the groundbreaking capability of cryptographic forms of money and the blockchain. When not in his office, he is tuned in to Nas, Eminem, and The Beatles.



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Just HODL! Bitcoin and Ethereum outperform ‘lower risk’ crypto index funds

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In the past two decades, index and exchange-traded funds (ETF) have become some of the most popular forms of investing because they offer investors a passive way to gain exposure to a basket of stocks as opposed to investing in individual stocks which increases risk of loss. 

Since 2018, this trend has extended to the crypto sector and products like the Bitwise 10 Large Cap Crypto Index (BITX) tracks the total return of Bitcoin (BTC), Ether (ETH), Cardano (ADA), Bitcoin Cash (BCH), Litecoin (LTC), Solana (SOL), Chainlink (LINK), Polygon (MATIC), Stellar (XLM) and Uniswap (UNI).

The ability to access multiple top projects through one weighted average market cap index sounds like a great way to spread out risk and gain exposure to a wider range of assets, but do these products offer investors a better return in terms of profit and protection against volatility when compared to the top-ranking cryptocurrencies?

Hodling versus crypto baskets

Delphi Digital took a closer look at the performance of the Bitwise 10 and compared it to the performance of Bitcoin following the December 2018 market bottom. The results show that investing in BTC was a more profitable strategy even though BITX was slightly less volatile.

Bitcoin price vs. Bitwise 10. Source: Delphi Digital

According to the report, “indices aren’t meant to outperform individual assets, they’re meant to be lower-risk portfolios compared to holding an individual asset,” so it’s not surprising to see BTC outperform BITX on a purely cost basis.

The index did offer less downside risk to investors as the market sold-off in May but the difference was “trivial” as “BTC’s max drawdown was 53% and Bitwise’s was 50%.”

Overall, the benefits of investing in an index versus Bitcoin are not that great because the volatile nature of the crypto market and frequent large drawdowns often have a larger effect on altcoins.

Delphi Digital said:

“Crypto indices continue to be a work-in-progress. Choosing assets, allocations, and re-balancing thresholds is a difficult task for an emerging asset class like crypto. But as the industry matures, we expect more efficient indices to pop up and gain traction.”

Ethereum also outperforms DeFi baskets

Decentralized finance (DeFi) has been one of the hottest crypto sectors in 2021 led by decentralized exchanges like Uniswap (UNI) and SushiSwap (SUSHI) and lending platforms like AAVE and Compound (COMP).

The DeFi Pulse Index (DPI) aims to tap into this rapid growth and the DPI token has allocations to 14 of the top DeFi tokens, including UNI, SUSHI, AAVE, COMP, Maker (MKR), Synthetic (SNX) and Yearn.finance (YFI).

When comparing the performance of DPI to Ether since the inception of the index, Ether significantly outperformed in terms of profitability and volatility, as evidenced by a 57% drawdown on Ether versus 65% for DPI.

Ether price vs. DeFi Pulse Index price. Source: Delphi Digital

While this is an “imperfect comparison” according to Delphi Digital due to the fact that “the risk and volatility of DeFi tokens are higher than Ether’s,” it still highlights the point that the traditional benefits seen from indices are not mirrored by crypto-based baskets.

Delphi Digital said:

“You could’ve just HODL-ed ETH for a superior risk-return profile.”

For the time being, Bitcoin and Ether have proven to be two of the lower-risk cryptocurrency plays available when compared to crypto index funds that offer exposure to a larger number of assets.

The views and opinions expressed here are solely those of the author and do not necessarily reflect the views of Cointelegraph.com. Every investment and trading move involves risk, you should conduct your own research when making a decision.