Hodl vs. Mayer-Multiple: What is better Bitcoin news?

Implementation of the Mayer Multiple Strategy
We enter the following code into the “Pine Editor”:
strategy(“Mayer Multiple total”, overlay=true, pyramiding=1000, default_qty_type=strategy.cash, default_qty_value=100000)
psma_length = input(200, title=”Price SMA Length”)
threshold = input(2.4, title=”Threshold”)
startyear = input(2016,title=”Start year”)
fromYear = year >= startyear
toYear = year <= year(timenow)
firstofmonth = dayofmonth == 1
ma = sma(close, psma_length)
multiple = close / ma
strategy.entry(“long”,true, when = firstofmonth and fromYear and toYear and multiple<threshold)
strategy.close(“long”,when=crossover(multiple,threshold) or (dayofmonth(time)+1==dayofmonth(timenow) and month(time)==month(timenow) and year(time)==year(timenow)) )

The Bitcoin news script above defines a small trading strategy:

As long as the Mayer multiple (the quotient of price and moving average) is less than 2.4, Bitcoin news is bought on every first of the month for a fixed amount. The amount taken is an absurdly high 100,000 US dollars – since Bitcoin news can only simulate the buying and selling of entire Bitcoin, such a high amount was chosen as an interim solution. However, tests have shown that the results are transferable to smaller investments.

If either the Mayer multiple is above 2.4 or the current date has been reached, the positions are sold. The whole thing then looks as follows on the Bitfinex exchange for the value pair Bitcoin/US dollar:

We have added our new strategy as an indicator here. This can be achieved by right-clicking on the chart, selecting “Insert Indicator” and selecting the saved strategy under “My Scripts”. We see that almost every month a long position is opened – only at the end of 2017 and beginning of 2018 the positions are closed.

So every month Bitcoin is bought and sold at certain times. In order to be able to assign these sales moments, we add the Mayer multiple indicator described above to the plot:

So we see that if the Mayer multiple on a first of the month was below 2.4, Bitcoin was purchased for a fixed amount. If the Mayer multiple was above 2.4, as it is today, it was cashed out.

Hodl or a Cost-Average Approach as Trading Strategy
This view is a nice visualization of an investment behavior, but what can you learn from it? We would like to compare this strategy with the classic Hodln. Therefore, we define a long-term strategy in which money is invested in Bitcoin every month (a cost-average approach is chosen accordingly). No attention is paid to the price or other indicators:

strategy(“HODL”, overlay=true, pyramiding=1000, default_qty_type=strategy.cash, default_qty_value=100000)
startyear = input(2016,title=”Start year”)
fromYear = year >= startyear
toYear = year < year(timenow)
firstofmonth = dayofmonth == 1
//mma = sma(multiple, msma_length)
strategy.entry(“long”,true, when = firstofmonth)
strategy.close(“long”,when=(dayofmonth(time)+1===dayofmonth(timenow) and month(time)==month(timenow) and year(time)==year(timenow)))

After this script has been saved under the name “HODL”, this strategy can also be added to the chart. The path is the same as described above, but the strategy is “HODL”. The resulting chart looks almost like the ones above, which is why it should not be shown here.

The “Strategy Tester” can be used to compare these two strategies

The “Strategy Tester” shows in the lower windows “Overview”, “Performance Summary” and “List of Trades” how one of the strategies has developed. The Overview shows a graphical overview of the portfolio development, while the List of Trades lists all investments made. The “Performance Summary” is of particular interest to us:

The “Performance Summary” is interesting because it shows, using various parameters, how profit has developed by building up long positions. The profit (net profit), the turnover (gross profit) and the losses (gross loss) are presented. In addition, various variables are listed, such as the max drawdown (the maximum cumulative loss), the buy and hold return (the return that would have been achieved if all the money had been invested right at the start). For the case under consideration, it is sufficient to limit oneself to these variables. We also focus on the relative sizes, as these are also correct in the case of a monthly investment of 100 euros.

To sum up, those who would have invested the same amount in Bitcoin every month since the beginning of 2016 would have achieved a cumulative profit of around 31,000 % today. However, it is noticeable that a relative loss of 12% can be absorbed.

Coinbase: Funding soon via subscription model?

The US crypto exchange Coinbase is apparently planning a new financing model. In the future, it may be necessary for users to take out a subscription to trade in crypto currencies.

A survey should first clarify Bitcoin loophole

When companies consider new products or Bitcoin loophole business models, they often ask their most loyal and active customers for their opinion like on: http://www.onlinebetrug.de/en/bitcoin-loophole In this way, it is possible to predict the success of the innovation before it is launched on the market. In the end, it should be the customers who will finance the company’s decision. According to Newsbtc, Coinbase recently launched a customer survey of this kind. The main focus was on a new financing option.

New fee model

Anyone who buys and sells Bitcoin & Co. via crypto exchanges always pays a fee to the Exchange for the transactions. This business model could soon change for Coinbase’s customers. A user survey conducted by Exchange suggests that the San Francisco-based crypto exchange is currently exploring new financing options. A subscription model also seems possible. A new fee structure seems plausible in the constantly changing crypto world. After all, it takes some ingenuity to stay competitive.

In the survey, Coinbase compared its fee model with other exchanges such as Binance, Huobi Pro and Gemini and asked respondents to evaluate the individual models. Another section of the survey presented a subscription model. This could serve to reduce subscriber fees in the long term. Those who pay a “modest subscription fee” monthly or annually could benefit from reduced transaction fees.

It remains to be seen whether this idea will actually be implemented. It therefore remains to be seen which result the survey will bring to light.

A report published in August by the Blockchain Transparency Institute showed that Coinbase had the most active users every day – over 100,000 more than Binance. Nevertheless, Coinbase ranked lowest by transaction volume among the four largest exchanges with over 100,000 active users daily – Binance, Huobi, OKEx and Coinbase. A more attractive fee model could possibly help here.

Bitcoin diving – What’s the next step?

How can it continue from here? In the short to medium term, the already mentioned price levels of 3,500 US dollars, 3,000 US dollars and 2,500 US dollars can be observed as new supports. For the long-term investor, however, the question is how things could continue.

The vernacular says so nicely that history does not repeat itself, but rhymes. So let’s take a look at Bitcoin’s share price history. The last bear market was from 2014 to 2016. Can we learn anything from that?

A look at the news spy chart of the Bitcoin price between 2011 and 2018 shows an interesting behaviour

The rhyme story can be seen in the news spy price fall and that of late 2014: In both cases the moving average of the last 140 weeks has been broken. At the same time, another important support broke, which had been in place for three years in both cases: Is The News Spy a Scam? Beware, Read our Review First

For the Bitcoin price, the end of the bear market had not come, but it moved at least above the moving average of the last 200 weeks. This proved to be a sufficiently strong support, so that the Bitcoin price moved sideways again afterwards.

So we should keep a close eye on the MA200 in the weekly chart. Looking at the weekly chart above teaches us something: Besides the MA20 in the weekly chart, which is mentioned more often, the MA140 should be considered as fundamental resistance in current price levels. A sustained rise above the MA140 at the end of 2015 was the harbinger of the coming bull market. So let’s look at this sign!

What should we do? Survival in the bear market

Actually, the same lesson applies in the bear market as in so many other life situations: Keep calm. An overheated sale only leads to the fact that you continue to pull your hair out. More than a year ago I wrote about the mindset you should have on the market. This is still true, as I described in other articles accompanying the Bear Market 2018.

From an investment point of view, there are basically two options to deal with the current bear market: You can be a trader or a long-term investor. The current phase is certainly exhausting for the long-term investor. He sees his portfolio shrink and lose more and more value. I can recommend him to do dollar cost averaging, or use methods like Mayer multiple and deal with portfolio theory. In Cryptokomass we actively manage three different model portfolios, of which we also follow the Conservative portfolio in a weekly column.

It should be noted, however, that this investment approach does not currently promise any short-term profit. Trading can be attractive for those who are looking for it. The trader takes advantage of market movements and is currently happy about the volatility that has returned to the market. The falling prices have brought good money to many a short. Of course it is a challenge for the trader to stay on the ball. Half-hearted trading sooner or later leads to empty pockets. At this point I can only recommend our weekly column about the top 3 crypto currencies, in which our analyst Thomas Hartmann from the trading school Crypto Currencies reveals a look at his cards to anyone interested in trading. Addendum: He also made a chart analysis of the recent fall in the share price:

Bitcoin, Ethereum and Ripple – Price analysis KW47 Update – Is there a bottom?
In addition I would like to recommend our Discord, where you can exchange ideas with passionate traders in its #trading channel. Especially in frustrating times, when the prices of Bitcoin and other crypto currencies are falling, the exchange with like-minded people helps not to lose your good mood despite winter and bear market.

ICOs – The Developer’s Perspective

The next panel and the next day were ultimately dedicated to developers: In the panel, Max Kordek, CEO of Lisk, Henning Dietrich, a programmer and bestselling author, Peter Harris of Resonate and Remco Bloemen of Neufund discussed their experiences and backgrounds regarding ICOs. It was interesting to discuss the technical aspect of decentralized crowdfunding after the discussion of the regulatory framework.

The discussion also focused on what is meant by the term crypto-economy. Roughly speaking, it can be summarized that this bulky term can be understood as a technology-based economy. Inflation is of course a keyword here; different protocols permit deterministic inflation and deflation rates. However, this technology does not stand as an absolute monarch; only through consensus, the community’s agreement on certain aspects of technology, can the crypto-economy become effective.

Blockchain for investors – Bitcoin formula projects introduce themselves

On the second day of the events organised by Astratum, various Bitcoin formula projects had the opportunity to introduce themselves to an interested audience: https://www.onlinebetrug.net/en/bitcoin-formula/ With Neufund and Bitnation, two projects represented on the above-mentioned panels were present for a second time and were able to discuss their projects in more detail. Starbase and Dent were two other projects.

After the first day ICOs and decentralized crowdfunding were illuminated from different sides it was interesting to see how different projects want to revolutionize ICOs: Neufund sees itself as a decentralised investment ecosystem and Starbase as a service provider offering token funding as a service, i.e. organising an ICO for interested parties.

Bitnation’s Toni Lane presented the vision behind her project:

A nation beyond existing borders, which exists on the internet and uses the blockchain for various tasks.

Mikko Linnamäki of DENT finally presented his project – a disruption of the mobile phone market – and above all his experiences with the organisation of an ICO. The humorous lecture, which dealt with trolls in slack channels, fanboys from South Korea and critics on bitcointalk, was a pleasant conclusion for the two evenings. Thanks to Sven Läpple and Astratum for these events on crypto-economy!

The ‘Bitcoin Secret Vault’: Are hackers blocked once and for all?

Cryptsy, Shapeshift, Gatecoin, Bitfinex… What connects these crypto exchanges? More than 130,000 BTC ( 73,818,875 US-$ or approx. 66.1 billion € according to today’s price) were collectively stolen by them in 2016. Hacks and attacks on Bitcoin stock exchanges have become so frequent that it is no longer surprising when one happens.

Although the frequency has brought with it a certain sensitivity, it does not make these incidents any less bad. If there is a robbery, investors will still face huge losses, bad news will scare away customers and new pressure will be exerted on entrepreneurs trying to bring new products to market.

CoinCenter Executive Director Jerry Brito told CoinDesk that such incidents would make his job a lot harder. The non-profit group researches crypto currencies and provides advice in this area. He said they are repeatedly forced to explain the differences between a restricted intermediary and the security of the core network.

Brito explained the Bitcoin secret

“The big hacks are putting pressure on the consumer protection authorities, those who have had little contact with digital currencies […] and this pressure could lead to a situation where easy solutions will not be accepted”. Reviews such as “Bitcoin secret has been hacked” help entrepreneurs and consultants not to inform the authorities about the technology.

Due to the unchangeable nature of Bitcoin secret transactions and the transparency of the blockchain, Bitcoin unfortunately remains a target for hackers, scammers and criminals. Bitcoin’s Blockchain makes it easy to find out how many Bitcoin are stored on a stock exchange. Once these devices change hands, it is impossible to confiscate them.

And yet that doesn’t mean that you haven’t done any research about it yet.

To mitigate the effects of such hacks, researchers Malte Möser, Ittay Eyal and Emin Gün Sirer have proposed the idea of ‘Bitcoin Vault’. They believe that this Bitcoin attack will make much more difficult.

Sirer said CoinDesk: “If the criminals realize that they can’t get away with their booty, we could see a drop in Bitcoin hacks.”

In the Vault

The main function of this idea is to allow users to recall their Bitcoin in case of a hack.

The function is simple in itself: a user creates a new address to store Bitcoin, which is then called “the vault”. This address is just like any other address, except for one difference: the users can’t immediately issue or transfer their Bitcoins.

By incorporating this speed reduction, you have something like a “second key”. The team also calls this function “recovery key”. “(“rescue key”). In the event of a hack, the owner of the Vault can reverse the transaction and the Bitcoin will be returned to the owner.

If a user wants to spend his Bitcoin, he starts with a transfer. Then you have to wait for a pre-determined time – which is determined by the creator of the vault – and then you can spend the bitcoin.

In this waiting time it is possible to use the Recovery Key.

Suppose a hacker gains access to the wallet and starts the transfer of Bitcoin. He has to wait for the time that has been set before – which can be a different time for everyone. Only then can he access the Bitcoin.

As long as the victim uses the recovery key during this time, the hacker is excluded and will not get access to Bitcoin. And each time the hacker tries to restart the transfer, the user can use his recovery key again, making it impossible for the hacker to ever gain control over the assets.

The ability to reverse transactions has been negatively received by some technology enthusiasts. Originally, Bitcoin was created specifically to ensure that transactions were not reversible.

The team behind the Vault’s proposal has no concerns. Their solution simply prevents Bitcoins from being issued while they are in the Vault. This prevents someone from buying something with Bitcoins in the Vault, receiving the product and reversing the transaction.

This forces users to first get their Bitcoin out of the Vault (wait a certain time), transfer Bitcoins into a ‘Hot Wallet’ and then buy the goods.

Action required
While this proposed solution sounds like a simple way to stop the hacks on stock exchanges, the poor media coverage makes it difficult to get a clear picture of the situation.

Bitcoins challenge: 100 million users

Michael Jackson is former COO of Skype, venture capitalist at Mangrove Capital Partners and board member of Bitcoin Wallet provider Blockchain.

Here he explains why it is so important that in 2016 interesting applications and services are developed to make Bitcoin appealing to users around the globe and confirm the value of the technology.

Crypto trader growth is also very impressive

As a lifelong technologist, engineer and now crypto trader partner at Mangrove Capital Partners, I often think about how transformative developments affect my environment as shown in this review. Throughout my career I have observed how the World Wide Web has provided hidden information to the whole world.

There are not many revolutionary technologies and they only occur very rarely, so it is important to be on the right moment. Currently it is almost impossible to enter a FinTech company without hearing about the blockchain.

The blockchain is omnipresent and as many readers know, unfortunately often misunderstood. Just to say that a company can use the blockchain doesn’t mean anything. Companies strive to build long-term relationships with their users and to create communities. You can have a good team with a lousy product or a brilliant idea but a bad execution. Success requires constant fresh energy, a strategy, perseverance and vision. And most importantly, you need a product that people really appreciate.

Bitcoin and Blockchain companies need to focus on solving problems first and then develop software that pleases their consumers.

Despite our slow progress, we have something precious

As the COO of Skype, I’ve been at the forefront of the biggest quantum leap in the telecommunications industry. Interestingly, most people don’t even know that almost all calls are already VoIP-enabled. The switching of the copper wires happened in the background. Phones and their interfaces have changed, but the human desire for telecommunications has remained. Peer to peer connections allow communication at the touch of a button and almost free of charge. The same applies immediately to transactions that are processed via the Bitcoin blockchain.

Just as with VoIP technology, it takes time for Bitcoin and the blockchain to be accepted. But this is already happening. It happens just like in the communications industry in the background. Just as all call centers today use the VoIP method, at some point transactions will increasingly be handled via the blockchain and take over the dominance.

I can’t remember a back-end system that ran 7 years, 365 days a year 24/7 without any problems. The Bitcoin blockchain has proven its resilience. A quick look at the statistics shows that the entire network is clearly maturing.

In recent months, the hashrate of the Bitcoin network has tripled to 650,000,000 GH/s.

According to publicly available information, there are already more than 10 million Bitcoin Wallets. The most meaningful statistic, however, is that of transaction volume: the number of transactions has risen from 80,000 to more than 200,000 per day and is growing steadily.

We need to talk – SEC crypto commissioner wants to promote exchanges

The US Securities and Exchange Commission has had a new crypto commissioner since June. Her name is Valerie Szczepanik and she hopes for more dialogue between the emerging crypto industry and the Securities and Exchange Commission (SEC) in the future.

It is the now almost old song that still echoes through the halls of the SEC. A thin melody that tells of the fears of investors. The dominant voice of the regulators, against which the melody hardly reaches the audience, roars over it. The quintessence of the regulatory song: Innovation against law.

But cryptosoft is about to change

At least when it comes to the US Securities and Exchange Commission’s cryptosoft commissioner. As Bloomberg reports, she explained that the current tones between the review of onlinebetrug about crypto start-ups and Franklin D. Roosevelt’s. Roosevelt founded SEC are anything but conducive:

“We hope that people will adapt. But if there are no signs of this, if people decide to ignore the laws, we might have to take a different line.”

So the threat resonates: Either you play by our rules or we have to strike a different note. Nevertheless, at the moment the SEC apparently prefers dialogue to dispute:

“We want people to come and talk to us. When I meet people, I want them to see me as someone who is interested in communication. And as someone who promotes innovation and helps investors and markets grow.”

Cryptozarin Valerie Szczepanik has experience

Her new job, called “Cryptozarin” by Bloomberg, involves monitoring the crypto industry and ICOs in particular. (Where it’s not easy to choose between scam and innovation and find the needle in the haystack. More information here). This is the experience of the Digital Assets and Innovation Commissioner, who has been in office since June, having previously supervised initial public offerings and share sales.

In any case, she will still have a lot to do with her job as a cryptozarin in the near future. According to Coinschedule’s figures, ICOs raised $5.6 billion in capital last month – more than in any previous month. (By the way, this corresponds approximately to Bitcoin’s 24-hour trading volume). The cryptozarin also participates in the decision on the upcoming Bitcoin ETFs. In any case, Valerie Szczepanik had a say in the decision to reject the Bitcoin ETFs of the Winklevoss brothers.

Among the regulators, she is considered an expert – in addition to 20 years of SEC experience, the 51-year-old also has experience in cryptospace. She has been working with Bitcoin for six years now – she can tell you a thing or two about it.

Augur and the difficulties of an “Appcoin”

The launch of Augur’s crypto currency did not have a good start on the digital market.

The prediction market based on Ethereum gained a good foothold last week. Its Reputation Token (REP) was quickly listed on well-known markets such as Poloniex, Bittrex and Kraken. However, the market value of this token fell quickly after the launch.

Looking to the future

Since then, some market observers have expressed concerns as to whether the Blockchain token has long-term survival potential and what the survival potential of “Appcoins” looks like in general.

The token actually serves as an incentive for users of the forecasting market to provide the Augur platform with reliable reports on real-world events. Last year, Augur raised around $5.3 million in sales of its REP token. The platform launched its beta in March, but only last week when it was free to trade.

This release is an interesting test of the Appcoin model. Tokens are distributed through the blockchain to drive acceptance and provide a means to support the project. While supporters see this model as a new way to generate financial support for start-ups and gain momentum, critics see Appcoins more as a “homeopathic” remedy with a new name.

How traders see this is currently unclear, but Augur already offers some data

The price of a REP token rose sharply after launch, but fell 52% after an opening of $13 on 4 October to $6 on 6 October. REP is currently listed on coinmarketcap for around $5.6.

Besides this sharp drop, Petar Zivkovski of the Whaleclub expressed his concerns about it having benefited most those who struck here early.

He explained CoinDesk:

“[REP] has rewarded accumulators, its founding team, the early buyers more than it would now be possible for anyone who buys tokens.”

First Movements
The digital currency quickly took its place in the top ten crypto currencies in terms of market capital. According to coinmarketcap it is still the eighth largest currency.

Although the token currently measures a market capitalization of $62 million, this is another descent from the all-time high of $119.7 million on October 5.

Most of the trading of this currency took place on Poloniex. Zivkovski emphasized that the first REP/BTC volume that went through this exchange was mainly a selling volume. According to his assumption, the first phase was a trade of “early accumulators… Please have tried to liquidate their REP [bitcoin]”.

But Arthur Hayes of BitMEX argued that the decline since the release was overall but all success. The price now remains above the price paid by early supporters last fall.

“I wouldn’t say this has set us back,” he said CoinDesk. “Dry is still traded well above the ICO as”.

What happens with the REP token from now on depends mainly on two factors: Acceptance and verification by the regulatory authorities.

Some argue that Augur may be driving through heavy regulatory waters and thus experience a similar fate to Intrade. The forecast market was closed in spring 2013 under pressure from the US government.

“Any successful forecasting market is likely to attract unwelcome and potentially fatal regulatory oversight, mainly related to sports betting,” Eliosoff said.

But even if the platform manages to survive through these regulatory risks through its decentralized management, he sees difficulties in keeping users for a long time. Augur decided to overtake Ether – the crypto currency of the Ethereum network. All this, together with the launch of his own Appcoins, could lead to long-term difficulties.

“For me this is exactly the description of this situation”, he explained CoinDesk.

At least one analyst of the market found an alternative perspective to the market launch. He suggested that the REP eyes will not be the last ethereum-based Appcoin.

“REP draws the first major Ethereum Subtoken attention from various stock exchanges to itself quotes, stressed Olaf Carlson-Wee, and is the digital asset hedge fund Polychain Capital. Added:

“He won’t be the last.”