Report: Bitcoin Driven by Transaction Volume and Investor Sentiment
Delphi Digital’s , an outlook of the bitcoin market and what drives it, has shed light on what data points are most important to monitor going forward. This report highlights the dynamic nature of crypto markets and why it cannot be compared to other markets.
Value Derived from Use and Sentiment
Delphi Digital’s new bitcoin outlook report suggests the bottom is in, and that the bull market has begun. This has been backed by indications from UTXO, , drawdown, and sentiment.
In December 2018, Delphi had stated that they believe bitcoin will bottom in Q1 2019, helping them build a fair amount of credibility in the last few months.
UTXO is at yearly high with over 66% of bitcoin output being unspent wallet holdings. From historical data, it is quite evident that high UTXO is positively correlated with upward pressure in price due to the demand-supply trade off it creates. When most holders are unwilling to spend their bitcoin, the supply in the market intrinsically reduces leading to demand overpowering supply. Coincidentally, this demand is in part led by these same holders who want to accumulate more bitcoin for their portfolios.
Indications
The NVT indicator is a 90 day moving average of daily transaction volume over the bitcoin network; a moving average is used in order to turn this data into a full blown leading indicator. By back testing this measure, the researchers found that NVT was remarkable in predicting long term and short term reversals in the market. When using the 90 day measure, the analysts wanted to figure out if NVT predicted any particular direction with higher accuracy and ultimately deduced that NVT is best used as a buy indicator. Over a 90 day period, success rate for long calls was 92 percent compared to a success rate for short calls at 81 percent.
Yet over the span of a year, the success rate was roughly the same at 86 percent for longs and 82 percent for shorts.
Increasing transactions show both, a demand for block space and higher velocity of bitcoin circulation; two of the most important measures in valuing bitcoin as per Chris Burniske’s crypto economy . But the most fascinating part is that both inactive outputs from the UTXO and number of bitcoin transactions both drive the market in the same manner despite having inversely correlated effect on the network itself.
UTXO is a play on demand-supply while NVT is a play on volume, so despite their differing effects, they are both positive indicators of what is it come. bitcoin is currently at a yearly high, which is quite blatant given the optimism on social media that the bottom is in and now is the time to accumulate.
However, such claims can never be predicted with pinpoint certainty as it is a very young and volatile market that can swing around and be easily manipulated by liquid whales.
In an published today, decentralized ad exchange platform AdEx has announced that it will be holding a token sale, which is scheduled to begin June 30th, 2017. The project seeks to raise 40 000 ETH over the course of the crowdsale.
About the AdEx Project
Current advertising networks like Google AdSense, Adsterra, ShareASale, and others are fraught with problems, not the least of which are ad fraud and lack of consumer privacy.
AdEx aims to change all of that by developing a decentralized blockchain-based ad exchange that will benefit all parties – advertisers, publishers, and consumers – while bringing data security, fraud protection, clear and accurate reporting, and numerous other advantages of blockchain technology to the online ad market.
Co-founder and CEO of AdEx Ivo Georgiev explains:
The solution offered by AdEx seeks to benefit all parties involved in the online advertising ecosystem, which means end users as well as advertisers and publishers, while removing unnecessary and downright risky elements currently associated with centralized infrastructure.
Once launched, the AdEx Network will enable transparency for advertisers, better ad serving control for publishers, and more control over privacy and ad preferences for consumers.
The Technology Behind the AdEx Platform
Developed on the Ethereum blockchain, one of the core strengths of the AdEx platform will be its use of smart contracts. A smart contract is a piece of software, executed on the Ethereum blockchain, that contains all of the terms, rules, and regulations for negotiating the terms of a contract. It automatically verifies the contract and then executes the agreed upon terms.
In the case of AdEx, these smart contracts will ensure the removal of third party intermediaries and ensure complete transparency of the entire system, from ad selection and tracking to bidding and payment. The complexities of choosing and tracking ads and facilitating bidding and payment will be defined in these smart contracts, simplifying and securing the entire process.
To mitigate the high costs associated with storage on the blockchain, AdEx will be utilizing (InterPlanetary File System) to host advertising related media such as images, videos, and larger data. Developed in 2014 by Protocol Labs, IPFS is described as a peer-to-peer hypermedia distribution protocol that allows for fast, secure storage and retrieval of data.
The AdEx team is also working on prototypes that incorporate several second layer solutions that will operate on top of Ethereum. These solutions will enable advertisers and publishers to easily interact while avoiding any potential blockchain limitations regarding speed and transaction fees. AdEx plans to implement IOTA as a future second layer to further improve the platform’s scalability.
Because AdEx is designed to be compatible with most of the existing ad tech industry, the process of adoption and integration by publishers and advertisers is easy. AdEx can be used in websites, mobile and desktop applications, and even embedded devices.
ADX Tokens and the Token Sale
The crowdsale, which begins on June 30, 2017, and runs through July 30, 2017, will fund the initial development and adoption of the AdEx advertising network. AdEx tokens (ADX) will use ERC20, a standard protocol for smart contract systems powered by native tokens. This will ensure the platform’s compatibility with other Ethereum-powered solutions.
In order to estimate and optimize the perfect supply of native tokens for the token sale, AdEx has partnered with , the developer of WINGS DAO. The project also engages the social graph of the WINGS DAO crypto-experts to maximize potential project backers who can serve as product champions and evangelists, allowing AdEx to quickly go to market.
The terms of the ADX token sale are as follows:
Crowdsale duration: 1 month
Start date: June 30, 2017
End date: July 30, 2017
Total number of ADX tokens: 100,000,000
Number of ADX tokens available for sale: 80,000,000
Currencies accepted: ETH
Token price: 1 ETH = 900 ADX
Campaign cap: 40,000 ETH
Over the course of the token crowdsale, 80% of all ADX tokens will be available for distribution among the supporters. Of the remaining twenty percent, 16% will be reserved for developers and advisors, which will be vested for a year to ensure the smooth development of the platform. The remaining 4% will be distributed between WINGS DAO community and the bounty campaign participants, as shown in the picture below.
During the campaign, only ETH transactions will be accepted. The address for contributions will be published at once the token sale has begun.
Future Plans
The first AdEx advertising platform prototype is scheduled for release as early as February 2018. It will include basic core features such as an ad bidding system, a front-end for advertisers publishers, and an SDK for publishers. The prototype will primarily focus on native and display advertising.
To ensure transparency, the prototype will undergo a stringent audit by an independent third party prior to release and its code will be completely open-source.
In the year following the successful release of its prototype, AdEx will focus heavily on business development as determined by both market needs and community feedback. During this time, AdEx plans to roll out major improvements to the platform, including user targeting and reporting, full integration of SDK, and video advertising.
By January 2019, AdEx plans to release AdEx v.2, which seeks to accommodate the needs of the increasing number of publishers and advertisers using the platform. The v.2 solution will essentially be a complete technological revamp, scaling the entire solution upward and possibly extending to other blockchains such as Aeternity or RSK.
Do you think the AdEx advertising platform will adequately address the shortcomings and failures of the current online advertising industry? What do you think is the most exciting aspect of this project? Let us know in the comments below.
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