Crypto20 Review: All you need to know about Crypto20
Does Digital Assets market interests you? Are you new to the cryptocurrency market? Don’t know in which cryptocurrency to invest? Well, then index funds may be the correct alternative for you for the time being. Index funds can be termed as mutual funds that are designed for the sole purpose of tracking the returns from the market index. According to the investors, the biggest mistake one can do is by investing in a single stock. The same concept goes with the Cryptocurrencies. Using index funds is advisable as one can invest in different types of Cryptocurrencies by investing in a single token. The experts and big investors would prefer cryptocurrency over the index funds but for the individuals new to this concept looking to invest in the digital market index fund is preferable. Also, index funds have proved better than the average managed funds since its creation. One of the index funds worth investing is Crypto20.
Introduction to Crypto20
Crypto20 was launched on October 16th, 2017 and is known as the first cryptocurrency tokenized index fund. The funds token is known as C20, representing the investors share in the fund. The token gives investors the ability to invest in the top 20 Cryptocurrencies without doing any research or worrying about the individual cryptocurrency. Crypto20 has used the funding raised from its ICO to buy the assets of the Cryptocurrencies performing well in the market. Crypto20 also has transparency in its Ethereum Blockchain which is good to seek the trust of investors giving them full access to their funds. The step of Know Your Customer (KYC) is mandatory if one wants to have the C20 token. Crypto20 has introduced using an API, trading tools and insights that are generated live from the 8 trades connected to the platform. There are various trading instruments that are being made available by the platform that includes advice on slippage, the very best price, and trading pair to acquire assets with and the quantity. It is obvious that as the time goes the top 20 performing Cryptocurrencies also change and hence the Crypto20’s holdings are also changed via weekly rebalancing. This weekly rebalancing mitigates the risk factor as well as volatility. Crypto20, being a passively managed fund, the fund managers do not participate in any kind of active trading except for the weekly rebalancing procedure.
Daniel Schwartzkopff: Daniel Schwartzkopff looks after the business development and market operations of the company and has a background in start-up, technology, and social networking development.
Luke Schwartzkopff: He is the backbone of the platform as he is responsible for the back-end development of the platform and also he is much into the data engineering sector of the company.
Raymond Botha: Raymond is part of the team of Automated Trading, Enterprise architecture and Systems Engineering.
Matthew Finlayson: He has designed the smart contract for the token and also has contributed to the development of the blockchain.
Frans Cronje: Working in the statistical finance and data science field of the company.
Jon Matonis: Provides financial services and works as the technical expert for economic exchange.
Jeremy Drzal: Financial advisor of the company and provides pace to the services of the company.
Oliver Laurence: Develops strategies for the marketing of the products.
Minaz Sarangi: Works on the Blockchain related matters and also is a financial advisor.
Theodosis Mourouzis: Expertise in cryptography, data analytics, and finance related issues.
Bobby Jonker: Working on the technology of automated trading in the financial market.
Grant Gohl: Looks after the development of the product and also is involved in the front end development of the platform.
Shad Paterson: Expert in the field of market management and promotional networking.
Francisco Jo: He is the marketing officer of the company.
Teruhito Shiraishi: Currently working in the field of brand management and marketing communication.
Advantages of Using Crypto20
Crypto20 makes the selection process of cryptocurrency for investing easy for the new investors having doubts by allowing them to invest in the top 20 performing Cryptocurrencies based on their market cap. Investors also have the ease of investing in different digital assets from a single platform without the trouble of creating accounts on several platforms and use different wallet types to store their cryptocurrency. The token also comes with a built-in smart contract for liquidity giving the token holders the ability to liquidate their tokens at any moment. Tracking of the digital market returns is made easy as there is no minimum amount required for investing in C20 tokens. As mentioned earlier, C20 also provides its investors, transparency of Blockchain. For the purpose of optimizing fund management and determination of parameters for future funds, use of machine learning is being by Crypto20.
Statistics and the market cap of Crypto20
The index fund had its ICO from the October 17th till November 30th, 2017. The company had hoped to raise a lump sum of 75 Million USD but the company was able to raise a whopping amount of 86,206,896 USD. At the time of the ICO, the C20 token was priced from the range of 0.95 to 1.10 USD which is now currently priced at $1.34 and had reached an all-time high of 4.25 USD in January 2018. In the month of February, the value of the fund settled around 2.50 USD. There is around 87 percent of the total minted tokens in circulation today. Around 10.5 % of the tokens were distributed among the C20 team, legal team, system security team, etc and other remaining tokens were distributed to promote marketing and improve relations with investors. The current market cap of the fund is 53,102,340 USD. According to technical analysis, the price prediction of the token shows that the fund is not a good long-term investment option. The price of the token can be easily manipulated as the market cap of the fund is low. The price prediction shows that there is a high chance of the price of the token to fall from $1.34 to $0.141 in a year which would be a drop of 89 percent.
C20 being new token in the market hasn’t been able to make it to the big exchanges. But the token has managed to get listed on few prominent exchanges such as BiBox, HitBTC, IDEX, and EtherDelta. HitBTC is a cryptocurrency exchange that had been launched in 2014 and is being operated by the team of Hit Techs limited. Other exchanges where the C20 tokens can be seen trading are Binance and Cryptopia. The C20 token cannot be obtained by any mining process hence one will have to buy it from the exchanges if he wants possession of the C20 token.
Crypto20 does not charge their investors in any form of exit fees or any broker fees for transferring their tokens. Also, the fees for weekly rebalancing is just 0.5 % p.a being deducted yearly and which is very less compared to that of other competitor’s fees. Also, there is a charge of 1% for using the build in liquidation feature of smart contract for selling the C20.
How to buy and sell a Crypto20 token
In order to buy a Crypto20 token, you will have to create an account on any of the exchanges that support Crypto20 token trading. Then you will have to buy a cryptocurrency using fiat currency, most preferably Ethereum and transfer it to the exchange platform for exchanging it with the C20 token.
There are two options available for the investors when it comes to the selling of C20 token
C20 can be exchanged on this cryptocurrency exchange platform efficiently with fiat currencies option as well.
2) Use the built-in liquidation option of the smart contract of C20.
In the second option, the investor is required to send a withdrawal request to the smart contract of the token after which the investor gets the amount of Ethereum which is equal to the total investment in the form of C20 tokens. The investor is charged a fee of 1% for this liquidation process.
Once the tokens are liquidated, it goes back to the Management team of Crypto20 who then sells the liquidated tokens on the exchanges, preventing the reduction in the number of tokens in circulation.
Where to store Crypto20 tokens
Crypto20 is ERC20 token. Therefore to store a Crypto20 token an ERC20 compliant Ethereum based wallet is needed which has an ERC20 protocol. There are various wallets where the Crypto20 tokens can be stored.
1) MyEtherWallet: MyEtherWallet is an open source client-side interface where Ethereum or C20 tokens can be stored and the wallet allows you to interact with the Blockchain.
2) MetaMask: Using MetaMask, one can run Ethereum Dapps right in the browser without running a full Ethereum node. It also provides a secured identity wallet to store various Cryptocurrencies.
3) Ledger Wallet: Ledger Wallet offers a hardware wallet or a chrome extension for multiple Cryptocurrencies.
4) Parity: Parity is the fastest and most secure way to access the Ethereum Blockchain.
The Rating System
Crypto20 is trying to increase their user-friendliness and for this purpose, the company will be utilizing a rating system just like any good decentralized platform does. In this way, users will be able to rate each other based on their trustworthiness making sure that no one would end up dealing with someone with a shady reputation and get cheated. There will also be filters in the system allowing people to choose the type of people they want to interact with.
Crypto20 token holdings
In order to ensure no dominance of any asset on the Crypto20, the maximum component weight of a holding in C20 is 10%. As per March 2018, the holdings of the Crypto20 tokens in form of top 20 Cryptocurrencies in percent are as follows
Bitcoin Cash: 9.93%
Ethereum Classic: 2.27%
Crypto20 VS ICONOMI
Like Crypto20, there are other index funds in the business having a good reputation and are performing well. Few of these index funds are ICONOMI, Hold10, etc. Both Crypto20 and ICONOMI aim to have investors ranging from expert level to the beginners level and both have the transparency in their respective Blockchain. According to Reddit, ICONOMI was meant to have its own index fund ICNX by now but there’s no sign of it stating that it is still under development. On the other hand, Crypto20 can be termed as a finished product rather than a developing platform. Crypto20 charges only 0.5% p.a year as a management fee while ICONOMI charges 6 times its competitors’ fees. Market tracking is easy with Crypto20 as compared to ICONOMI as the Crypto20 rebalances on a weekly basis while ICONOMI’s rebalancing is done on a monthly basis which is too slow to track the market. ICONOMI trades in more coins than Crypto20 which trades only in the top 20 performing coins according to their market cap.
Index funds have emerged as a great alternative for the individual Cryptocurrencies and the fund like Crypto20 is a part of it. Despite being in its young days, Crypto20’s token has made it to the top 200 tokens in terms of market cap. The fund is yet to release its beta version but is having a great response. Being able to find more than 10 major partners, the fund looks in a good shape and ready for any upsets in future. Since Crypto20 trades only with the top tokens, it is one of the best options in the field of the index fund. Keeping in mind the increasing interest of people in Cryptocurrencies, its future looks good and with this, future of platform like Crypto20 also looks good. But due to the low market cap of the Crypto20 token, it would be difficult for the company to set a good base for its future plans and projects but the company seems legit so it can be hoped that the fund will tackle its problems and flourish.