On Friday, March 22nd, Bitmex CEO Arthur Hayes and the Bitmex research desk released their first email update of 2019. These updates are called “Bitmex Crypto Trader Digests” and normally include interesting write-ups involving statistics and relevant data points throughout the cryptocurrency ecosystem. Overall these email updates pushed by Mr. Hayes and the Bitmex team are by far one of the more educational and factually correct news updates in cryptocurrency. All of the blog posts referenced as well as the weekly update will be linked in sources below.
On the March 22nd update, there are links to multiple blogs posts by the Bitmex research team and one of these posts is a study tracking funds that ICO teams allocated to themselves. This study looking at ICO team holdings revealed that the team’s collective “holdings were an astonishing US $24.2 billion on issuance” but it is also important to note that “in reality, liquidity was too low for this value to be realized.” This is the Bitmex Research team’s third major investigation into ICOs, and while ICOs created a reported US $24.2 Billion in token creation this number today is down to roughly US $5 Billion due to multiple factors.
The $24.2 billion number today is down to roughly $5 billion after losses due to coins leaving the teams addresses (potentially OTC sales), losses due to the token price change, and coin burns. It is also important to note that this data comes from 108 tokens based on price data up to January 2019. Interestingly enough, the Bitmex Research team reported that at the coins’ individual peaks, the value created is over $80 billion. While this value would be tough to realize due to liquidity issues, it is amazing to think that almost $1 trillion was created through the ICO boom throughout these past couple of years. The Bitmex Research team states that “based on current illiquid spot prices, the ICO teams still appear to own around $5 billion of their own tokens, money they essentially got form nothing, depending on one’s view.”
In a section titled “The Road to 10k” Arthur Hayes states that “nothing goes up or down in a straight line” and continues on by stating that “2019 will be boring, but green shoots will appear towards year-end.” Commenting some on the traditional financial systems, Hayes states that “the mighty central bank printing presses paused for a while, but economic sophists could not resist the siren call of free money.”
While Hayes has a pretty strong conviction that “green shoots will begin to appears early in Q4” he reminds us that “free money and collective amnesia are powerful drugs.” It is always important to check your personal euphoria along the way to ensure you do not get overly caught up in the ride. Hayes says that “the 2019 chop will be intense, but the markets will claw back to $10,000” and states that this price level is “a very significant psychological barrier.” Hayes ends his newsletter with a message to Melissa Lee from CNBC’s fast money saying “Melissa Lee peep this. $10,000 is my number, and I’m stickin’ to it.”
DragonBTC is a technical analyst, price action trader, and freelance content creator who discovered bitcoin back in 2016. Intrigued with the technical aspects of the ecosystem, the concept of mining is what initially grabbed the Dragon’s interest. Along with currently studying computer science, DragonBTC is focused on bringing quality and helpful content to the cryptocurrency space.
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The Dragon is not a licensed financial advisor. The information presented in this article is an opinion, and is not purported to be fact. Bitcoin and cryptocurrencies are a volatile instrument and can move quickly in any direction. The Dragon is not responsible for any trading loss for anything stated in this article.