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What a 41 minute head start means to crypto traders

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When exchange listing news hits the crypto market, there’s often a spike in trading volume and a rapid (if often short-lived) appreciation in the price of the crypto asset. The degree of movement depends on the exchange making the announcement, the liquidity of the token and many other factors — but as has been identified on multiple occasions, a Coinbase or Binance listing often moves markets.

Of course, the market participants who react fastest to this kind of news usually secure the best opportunity for delta.

So where does the savvy crypto investor spend their time in order to beat the market? Constantly refreshing the Coinbase blog? Bugging CZ’s non-existent office? Sifting through thousands of accounts on Twitter? (Good luck with that.)

As always, when there’s the potential for profit, human ingenuity finds a way — in this case, the NewsQuake™ service from Cointelegraph Markets Pro, which delivers news with market-moving potential to members in seconds… and often long before the masses get wind of major developments.

At the heart of the magic is a machine-learning algorithm that continuously monitors thousands of crypto blogs, Twitter accounts, and industry publications. It automatically selects exchange listings, partnerships, and staking announcements that have historically moved coin prices the most, and sends alerts directly to members.

It’s the exact same tech that powers Cointelegraph news (and our major competitors) — but delivered in seconds, without the intervening need for writing a story.

Three announcements this month have demonstrated that if traders aren’t fast, they’ll probably be furious.

Nervos Network’s cross-chain partnership with Cardano

Building an interoperability bridge with Cardano is obviously a big deal for the less famed Nervos Network and its utility token, CKB.

While most people learn of such collaborations from Twitter, blockchain projects often break the news in their blogs first. The NewsQuakes™ algorithm has you covered here, keeping an eye on every crypto project’s blog worth following.

On June 2, when the Nervos-Cardano partnership was announced on the company’s blog, it took Markets Pro less than 40 seconds to hit its subscribers with an alert, marked with a red circle in the chart. At that moment, CKB price was at $0.015 (first red box).

Apparently, very few crypto traders noticed it: In the next two hours, the price hadn’t moved much.

Interestingly, the tweet about the announcement took two hours to arrive, after which the price finally began picking up. In less than 30 hours, it reached $0.024 — a 37% increase.

Those who received the initial NewsQuake™ alert from Markets Pro on their phone had a benefit of two extra hours — time they could use to weigh their investment decision and leisurely fill their bags with the coin that was just about to explode.

The launch of Cardano staking on OKEx

There was also quite a gap between the May 24 blog announcement of the upcoming launch of ADA staking on OKEx and the platform’s tweet the next day informing users that the service was now active: 22 hours.

It took the NewsQuakes™ system less than a minute to identify the original blog post as potentially influential and send out an alert (first red circle, price $1.47).

A lot of folks seemed to catch up, as ADA’s price began climbing steadily from there to reach $1.57 by the time the tweet got posted (second red circle).

This 6.5% return within 22 hours could be considered a prize for those who went with the initial NewsQuake™.

When the tweet appeared, the fading momentum got a further boost as the Twitter crowd rushed into action. The peak of $1.77 was achieved a day and a half later (red box in the chart), meaning that overall Markets Pro users could have generated a 17% profit from the event with an entry point timed shortly after receiving their initial alert.

Solana listing on Bitfinex

In the case of the SOL listing on Bitfinex that was unveiled on May 31, the time between the exchange’s blog post carrying the news and a subsequent tweet was 42 minutes. With the NewsQuake™ delivery time of under a minute, it makes for roughly 41 minutes for Markets Pro users to thoroughly deliberate and set up their buy orders before word reached the trader masses.

As the graph shows, Solana’s price did not spike sharply thereafter, but rather adopted a smoother trajectory that saw it rise from around $31 at the time of the NewsQuakes™ to almost $38 within three days — a 19% increase in value.

Markets are information systems, and the value of any asset is a function of information exchange between market participants. This is especially true for the cryptocurrency space, as the valuation of digital assets is tremendously sensitive to news-driven swings of trader sentiment.

Those who are lucky enough to beat the crowd in getting an actionable scoop even by a few minutes can leverage their knowledge to generate profits.

Cointelegraph Markets Pro is available exclusively to members on a monthly basis at $99 per month, or annually with two free months included. It carries a 14-day money-back policy, to ensure that it fits the crypto trading and investing research needs of subscribers, and members can cancel anytime.

Cointelegraph is a publisher of financial information, not an investment adviser. We do not provide personalized or individualized investment advice. Cryptocurrencies are volatile investments and carry significant risk including the risk of permanent and total loss. Past performance is not indicative of future results. Figures and charts are correct at the time of writing or as otherwise specified. Live-tested strategies are not recommendations. Consult your financial advisor before making financial decisions. Full terms and conditions.





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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.