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How does Cryptocompare work? Complete insights

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How does cryptocompare work

Understanding the actual math behind the price indexing by Cryptocompare

 

Introduction to indexing

Cryptocurrency index is the most engaging tool one can apply in order to get a brief idea about the current state of affairs. There are almost more than thousands of cryptocurrencies which have been developed, with Bitcoin being the most dominating one. All these circumstances only lead to a conclusion that both the private and institutional investors are going to, no sooner depart from cryptocurrencies.   

 

Importance of indexing

Regardless of the type of investors, they are finding it challenging to choose the right cryptocurrency portfolio in order to optimize their returns on investment. The best strategy one can apply is cryptocurrency indexing. Technically, indexing is the process of optimizing the disk space utilization whenever a query is processed. However, according to financial terms, indexing is the best strategy a private investor can apply in order to gain stabilized return of investment on a long-term basis.

It is nothing but an allocation of the financial assets that the private investor is looking forward to investing in, in his portfolio, in a systematic manner so as to stabilize everything. The movement in the cryptocurrency market, like any other traditional market, completely depends on the mindset, values, beliefs, and goals of billions of people around the world on the market and hence evaluating each and everyone’s goal and aggregating them to predict the market conditions by an individual is almost impossible.

 

CryptoCompare

There are a number of traditional stock market index providers which use professional methods in order to give their users, a concise condition of the market, like German DAX, the Dow Jones, the British FTSE 100, etc. On the other hand, in cryptocurrency space there are only a handful of cryptocurrency index providers and the most preferred one is CryptoCompare.

It is one of the most interactive discussion platforms which is even specialized in providing the users with real-time information in the current market streams. Cryptocompare was founded by two cryptocurrency enthusiast namely Charlie Hayter and Vlad Cealicu, both the visionaries left their full-time job in November 2014 when they received fundings for the project.

An effective cryptocurrency index is provided by cryptocompare for most popular cryptocurrency coins like Bitcoin, Bitcoin cash, Ethereum, Ripple, Litecoin etc. As each investor has his own goals towards them, and developing a cryptocurrency index might not please all the investors. Daily trading volume is the key concept they consider before averaging the price of a cryptocurrency from an exchange. The cryptocurrency exchanges which the company uses must have a sizeable daily trading volume. Apart from considering the objective metrics, subjective metrics are also taken into account as to how reliable and trustworthy the cryptocurrency exchange is.

If a particular cryptocurrency exchange doesn’t seem to be reliable and worth enough to be included, is not included, to calculate the aggregate price of a designated cryptocurrency coin. But the trading volume from all the cryptocurrency exchanges is considered regardless of its size of the trading volume.

 

Calculating the price index

Volume Weighted Average Price (VWAP) is the paradigm that the indexer for CryptoCompare uses. The past 24-hour trading volume is considered by the indexer. For example, considering two exchanges X and Y, if an exchange X has 60% of the trading volume in the past 24 hours then the aggregate index is calculated as follows.  

Index = (last trade on X)*0.6 + (last trade on Y)*0.4

 

Calculating the percentage of trading volume

In order to calculate the percentage of trading volume for a cryptocurrency exchange among the total. The crypto exchanges which were used for price calculation are only considered even here. For practical reasons, when a particular cryptocurrency exchange goes offline which means that no trade happens for a particular duration of time, then lesser priority is given to such exchanges depending upon their ideal time. Hence cryptocurrency exchanges with high ideal time are given lesser preference automatically.

 

reduction =(Over 5 Min:0.8 ,Over 10 Min:0.6, Over 15 Min:0.4, Over 20 Min:0.2, Over 25 Min:0.0)

 

For illustration, if an exchange has been ideal from 15 to 20 minutes then only 40% of its trading volume is considered. This effectively rules out the price uncertainties.

Professionals at cryptocompare even make use of Open High Low Close (OHLC) charts in order to assess the precise market price. The preeminent and also the most undervalued cryptocurrency is taken into account.  

 

Conclusion

Although the cryptocurrency index providers provide real-time data there are some bottlenecks. The real world cost of slippage, impracticality for the investors to adjust their portfolios according to the changing market, also the intermediate commissions, taxes, along with the transaction fees are exempted.

#Bitcoin

XRP is now #2 Cryptocurrency, Ripple overtook Ethereum

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XRP is now officially the #2 cryptocurrency in the world with over $2.4 Billion Market Cap. The recent increase in the market cap was due to the rapid surge in Ripple Price after the XRapid Launch news was published.

The market cap of Ripple is now $23555443, which just surpassed Ethereum’s market cap of $23367070

Bitcoin Market cap stands at #1 at $116228274

 

Ripple Price Rise

XRP  Price broke all the obstacles and went to a swift uptrend against both Bitcoin and US Dollar. With the surging price, the total market cap of the cryptocurrency also noticed an enormous hype making Ripple the #2 Cryptocurrency after Bitcoin; beating Ethereum on the Cryptocurrency Market Capitalization list. More and more banks are utilizing the Xcurrent platform including the recent adoption by PNC , USA’s top financial services group.

 

Ethereum Price Decay

The former #2 cryptocurrency Ethereum noticed a vast decay in the previous few weeks with the reasons starting from large OTC selling by ICO’s (Initial Coin Offerings) and the ethereum miners backing out saying that ‘Ethereum Mining is no more profitable’. Ethereum price dropped down from whooping $450 in August to $190 a few days back. This has resulted to a huge number of prominent investors and traders opting out of the Etheruem Cryptocurrency stating that Ethereum has no future now.

 

Can Ripple Maintain the #2 position now or will Ethereum take back revenge? What are your thoughts on the same? Tell us in the comments section below.

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#Bitcoin

Is Bitcoin banned in India? Complete Analysis

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The major incident that first led Reserve Bank of India to send out a notice such as that was because of the price inflation that was noticed in Bitcoin.

Cryptocurrencies have been changing every business market in every country including India, sufficient enough to say it has been changing the business market of the whole world. A country like having many traditional values are reluctant before exploring something new and trusting the new values.

India and cryptocurrency markets

Banking service as it is in India has many sentiments and follows strict protocols to make sure that there are no malicious content or malicious practices between both the parties and bank as third party makes sure of this. When these protocols are not followed they are penalized with heavy consequences to make sure the mistake does not happen again.

In a market such as cryptocurrency the transactions happen between two parties without any interference from the third party. There is not much availability to records and the transaction procedures are privatized too. Operations such as this are threatening to the protocols followed by the Indian markets. Thus, Indian financial markets are reluctant towards moving towards the cryptocurrency markets.

What is Bitcoin

Bitcoin is a digital currency that are issued in the form of virtual digital coins in various digital currency exchange platforms where users can use them to trade and transact for their financial purposes either as an individual or as business entity.

India and its differences with Bitcoin

Indian markets are always sure of what is next in terms of financial analysis and markets to meet out demands and make sure the country does not run into an economic crash. India has a low gross domestic profit (GDP) compared to other fast-growing countries making it try harder and harder to level its financial markets with advancing countries.

When cryptocurrencies such as Bitcoin entered the Indian markets, it threatened many businesses as there is no middle man in it. This led every financial analyst in India to believe that this might give an opportunity to all malicious practitioners to undertake this as an opportunity to hack or use this virtual money for malicious threats. But this did not lead India to consider banning Bitcoin but rather the incident that took place regarding Bitcoin in the foreign markets is what lead Reserve Bank of India (RBI) to put a notice to all Indian banks asking it to shut down all operations that is taking place with Bitcoin or any other cryptocurrency as a means of financial transactions.

The major incident that first led Reserve Bank of India (RBI) to send out a notice such as that was because of the price inflation that was noticed in Bitcoin. The sudden price inflation of Bitcoin overnight started making Reserve Bank of India wonder what would it be the consequence if the more and more Indian business markets started investing in it too. Because of Bitcoin inflation, the price of everything in India markets would go high making it a difficult situation for all the customers as well as the Indian people as it would affect the daily life of the public too.

Considering this Reserve Bank of India issued a notice to all banks asking them to stop all transactions that was under Bitcoin transactions. All investors were given a period of time to sell them and exit the Bitcoin market. All investors who saw the potential of Bitcoin filed a petition on this subject to The Supreme Court of India asking for it to release the notice and allow everyone to use Bitcoins.  However, there is not much development on the case as of yet. So, if any individual wants to buy a Bitcoin and trade them, they are still allowed to do it. It just that business entities cannot do transactions under Bitcoin as it goes against the ReserveBankofIndian rules and the ban it is trying to impose on Bitcoin being used by business markets of India.

The operational line of Bitcoin in India has been on a process towards its ban starting from investors of India investing in Bitcoin which led Reserve Bank of India to analyse Bitcoin by which they noticed high inflation and price fluctuations leading to issuing the notice to all banks of India to stop using Bitcoin and then the government imposing heavy duty taxes on everyone investing in Bitcoin to stop the practice of using them which then was followed by the Indian financial ministers issuing a bill stating activities using Bitcoin as a medium for transaction will not be encouraged. Various analysts and research teams from India have been appointed to study how Bitcoin works and their opportunities along with their drawbacks. Meanwhile in India some research teams have been trying to prove that Bitcoin is dangerous to support Reserve Bank of India. The supreme court finally issued a ban but upon many files petitioned as a plea to lift the ban, the supreme court of India has been reconsidering its decision and is waiting to make the announcement if the ban will be lifted or not for using Bitcoin. This ban lift was supposed to be announced on September 11th which got postponed to September 17th and then again postponed to coming Monday.

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#Tron Price Analysis

10 reasons why TRON TRX price can increase massively this year

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One of the biggest reason for Tron’s (TRX) massive increase in price is its continued growth with its fundamental strength. TRON price will increase.

What is TRON?

TRON is a decentralized platform based on Blockchain and aims to build a digital content sharing platform eventually leveraging peer to peer (p2p) blockchain system. TRON first founded by a non-profit Singapore based foundation, and this foundation is specifically seeking to distribute the global entertainment industry.

Presently, lots of user data and traffic managed by a few corporations like Google, Amazon, and Facebook & Snapchat. TRON creates some serious steps to control by placing ownership of the data back into the creator’s hands.

 

Features of TRON

There are some key features of TRON, given below

  • TRON wants to heal the Internet with its entertainment features.
  • Data liberation; free and uncontrolled data.
  • Content-enabled ecosystem, where users can obtain digital assets from content spreading.
  • Personal ICO with the ability to distribute digital assets.
  • Different infrastructure which allows distributing digital assets exchange (such as games) and marketing forecasting.

 

Advantages of TRON

TRON has the biggest advantage, is its good team of developers, advisers, and investors. It’s CEO is Justin Sun, who is the protégé of Jack Ma, the founder of the Alibaba group and other advantages the fact about data creators, which are the data ownership of central and also the users on the Tron network are entitled to proportional profits granted by rules. Tron has an idea to administrate free service platforms for the public. That’s why it is operated and designed to serve the masses that enjoy entertainment content around the world.

 

Reasons for the massive increase in the price of TRON

If you are having feelings like the heat just because of the price of TRON. Well, don’t be.  This is a right time to get yourself a bit rich with the massive increase in the price of Tron. That is because what is happening now in the market is that wide crash that has seen previously in all cryptos shed a good portion of their value, with bitcoin dropping below $7700. While everything else has risen again, Tron (TRX) is in an incredibly good position with its risen up again by even bigger margins.

 

Here are the reasons why TRX price could rise:

The Mainnet Launch

In the previous scenario, just a few months ago Tron was in deep fall and it was migrating from the Ethereum blockchain to its own blockchain. But besides all this, several major exchanges have announced to support for the Tron migration, indicating that this event will be a major success as it is a strong enough reason to get into Tron at today’s prices, which reap big once the main net goes live.

 

Tron’s Drawing more in developers

In the Tron (TRX) case, its success completely depends on the team which has been pushing hard to woo Ethereum developers to the project. Tron team has used airdrops and other rewards to achieve this end. Giving them those incentives are worthwhile and one can expect the faster completion of project milestones, which will serve to further drive up the price.

  • One of the biggest reason for Tron’s (TRX) massive increase in price is its continued growth with its fundamental strength.
  • The other important reason for the massive growth is because it led by an aggressive and ambitious leader. Justin Sun, the CEO of Tron, has not only overseen the fast-tracking of milestone deadlines, but he has also decided that he wants Tron to be a top 6 coin in crypto ranking.
  • It had been hovering in this position for the last few months, until a few deep altcoin drops of the last few weeks. TRON’s peak coin price will be again high as eight cents just in a short duration.
  • From the beginning and the new holders who recently have joined, It sees a movement of about $200 million each day, give or take, and this spread across the major trading coin out there.
  • According to the price predicting; fiat trading is still extremely unrepresented here. That means is going to have an enormous opportunity to crack more fiat selling with a massive increase in prices and growth parallel.
  • Tron’s strong & steady strength which makes it continuously moving and this is also the reason for a massive increase in the price of Tron.

 

Note: This article represents only the opinion of the writer. The article is not, in any way, an investment advise. All cryptocurrency investments are risky and you should do your own research and analysis before buying or selling any digital assets including TRX.

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