At the end of February 2018, the price of Crush Crypto Core (CCC) was $2.9548, representing a decline of 19.2% from the previous month.
CCC is a digital asset array on the ICONOMI platform. Starting with a $100,000 seed capital in October 2017, CCC had assets under management of $3.1 million as of February 28, 2018.
The cryptocurrency market had a rough first two months this year. We believe it is a technical correction (a steep one at that) as there weren’t any major news that adversely affected the overall fundamentals of the industry.
Some people compare the current cycle we are in to the crash experienced in 2014 but we believe it is not a good comparison. The industry has grown significantly and has a lot more than just one use case (internet money), compared to 4 years ago.
Citi estimated that in 2017, there was a fiat net inflow of $10 billion into cryptocurrency, which contributed to the expansion of the overall market cap by $500 billion. This means a $1 fiat inflow would equal to a $50 increase in crypto market cap.
This is a two-edged sword – a small movement of fiat into or out of the cryptocurrency market would translate into a wild swing in cryptocurrency prices, which is one of the reasons why cryptocurrency prices are so volatile.
Every passing day, with cryptocurrency getting adopted by more individuals and companies alike, more applications being built on the blockchain, and more investors (individual and institutional) putting money into the space, the fundamentals of cryptocurrency is better than ever.
For the reasons above, we believe we are close to being out of the woods. There are just so many good fundamental developments relating to cryptocurrencies that it is hard to see a prolonged bear market. Eventually investors cannot resist and big money will move into the space.
On Market Entry
From our observations, most people buy high and sell low. This is the opposite of what they should be doing. The image below shows the net in/outflow of CCC in 2018.
From the chart above, you can see that during the first half of January, when the market peaked, that’s when the largest amount of inflow happens. Conversely, people redeem CCC the most when the market crashes, as it did in early February.
This shows that people tend to buy and sell at the worst possible times.
If you have been following Crush Crypto for a while, you may notice we have been quoting Warren Buffett over and over again: “be greedy when others are fearful and be fearful when others are greedy”. Evidently it is hard to put it into practice, and some people may let their emotions get to them. Don’t be like them.
CCC is a long-term holding with a healthy mix of safer and more speculative assets. We will do the rebalancing for you. You don’t need to time the entry for CCC.
CCC declined by 19.2% during February 2018. In general, bigger coins outperformed smaller coins/tokens – a sharp reversal of what happened in the previous two months.
While February was a down month, there were two coins (Bitcoin and Monero) that were up. Most of the other coins dropped (Dash -16%, Bitcoin Cash -10%, Ether -24%, Steem -36%, Qtum -38%, and Icon -54%).
All tokens in the portfolio declined by varying degrees (Everex -23%, Raiden -34%, Funfair -39%, 0x -50%, and Kyber Network -58%).
As no coins have been added to the eligible list of assets on ICONOMI, we have not made any changes to the asset allocation of CCC in February. We went with the trend and let the winners ride – it turned out to be the right strategy as the bigger coins kept outperforming the smaller coins/tokens during the month.
We are currently overweight Monero, Kyber Network, and ICON. Here’s our thoughts on each of these coins/tokens:
Monero: Best privacy coin with the most usage in our opinion. We believe it is a safe bet to outperform the overall cryptocurrency market.
Kyber Network: The token price dropped after the mainnet pilot, but we like the release and believe it will soon gain significant traction once the team (1) opens up the whitelist to more people, and (2) integrates Kyber Network with more wallets and dApps to facilitate instant token exchanges.
There are just so many tokens out there and users do not currently have an easy way to exchange different tokens easily. Kyber can solve this problem in a decentralized manner.
ICON: The mainnet launch was disappointing to some market participants because coin holders still haven’t received the mainnet coins and cannot transact on the mainnet. However, development has been rapid with the completion of the mainnet wallet. The token swap is expected to take place in March and the team has lined up lots of business partnerships. We are very bullish about the coin at this valuation.
* The information contained in this article is for education purpose only and not financial advice. Do your own research before making any investment decisions.