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Yale University Economists Determine Best Times To Buy Cryptocurrencies

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It seems like everyone wants to know the best time to buy crypto – right?

Well…

Two economists from Yale University have recently researched and outlined a basic strategy for identifying the best buying opportunities for cryptocurrencies. After studying the past performance of the three most popular digital assets, they identified a couple of methods that will help any investor to predict price movements.

One of the things that makes choosing an entry point for buying crypto hard is – volatility. Bitcoin is an example of that and a cryptocurrency which tends to swing over just a few hours.

The two Yale economists believe that they have identified two factors that can provide information about the potential price movements. In their paper which is named Risks and Returns Of Cryptocurrency, they explore the historical price patterns in an effort to identify the factors that can determine the price movements over a short period of time.

After studying the price movements during the period 2011-2018 for Bitcoin, 2015-2018 for Ether and 2012-2018 for Ripple, they were able to identify the two factors – naming them the “momentum effect” and the “investor attention effect”.

The first factor is the momentum. In the report, they note that the price of Bitcoin has many times increased rapidly during a single week. As Tsyvinsky (one of the researchers) explained to CNBC:

“Momentum is actually something simple… If things go up, they continue to go up on average, and if things go down, they continue to go down.”

So, the momentum basically focuses on buying currency following a week in which the price had experienced a sharp upwards trend – around 20% – and selling a week later.

The second factor was the “investor attention effect” which simply means that the amount of interest around cryptocurrencies can be another thing to help with the prediction of price movements. As they said in the report, Google Trends and Twitter posts are good indicators of investor attention.

“A one-standard-deviation increase in the Twitter post count for the word ‘bitcoin’ yields a 2.50 percent increase in the 1-week ahead Bitcoin returns.”

Still, the pair of Yale University researchers also stressed that this is not advice to investors – and the metrics are neither hard nor fast rules.

“A one-standard-deviation increase in the Twitter post count for the word ‘bitcoin’ yields a 2.50 percent increase in the 1-week ahead Bitcoin returns,” Tsyvinsky concluded.

 

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5% Of Moscow Residents Who Use Non-Cash Methods Are Open To Using Cryptocurrencies

A new poll went viral in the latest cryptocurrency news, this time carried out in Moscow, the capital of Russia. As Forbes Russia first reported on November 13th, more than five percent of all residents of Moscow that use non-cash payment methods are open to exploring the use of cryptocurrencies such as Bitcoin. Carried out by the Russian payment service Yandex.Money as well as the Moscow Information Technology Department (ITD), the poll surveyed more than 1,000 Moscow residents of various age categories over the phone. The researchers found that among the residents who use non-cash methods, 5% are willing to start using cryptocurrency to pay for their purchases - while 1% already use digital currencies. Among the most common forms of non-cash payments in Russia are bank cards (96%) followed by mobile bank apps (40%), Internet banking (32%) and e-money (16%). The head of the analytics department at ITD, Ivan Buturlin, recently stated that “34 percent of Moscow residents use primarily non-cash methods of payment, wherein 63 percent conduct electronic transactions at least once a day.” When asked why they refrain from using cashless payment systems, about 40% of the respondents pointed to security concerns, 22% of them said they don't want to pay extra fees and 11% said they did not understand how to use the non-cash payment services, while 9% said that they don't know what cashless payment methods are. As the CEO of Yandex.Money summed up following the publish of the results of this survey:
“In order for non-cash payments to penetrate into the lives of a larger number of citizens, people should also change their perception to understand that this is a safe method of payment.”
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Altcoin News

Crypto Market Capitalization Has Fallen To A New 2018 Low

The latest news on our DC Forecasts crypto news site clearly show d0wnward movements for both Bitcoin and many altcoins in the market. The prices of major cryptocurrencies have dropped significantly. Currently, Bitcoin is trading at around $5,639 falling by more than 12% on the day and showing big signs of volatility as a leader in terms of market capitalization. Speaking of which, the market cap behind Bitcoin dropped below the $100 billion level for the first time since November 12th last year. In the past 12 hours, the total market capitalization fell from $210 billion to the current $180 billion, depreciating by 15% and leading the market to the lowest value since October 31st of last year. There are many other major cryptocurrencies that are reporting declines in excess of 10% on the day. Some of them are Ethereum, Ripple (XRP) and Bitcoin Cash - the latter of which holds the record for its continuous decline over the past week. What's also important to note is the fact that Ripple (XRP) is now the second largest cryptocurrency by market cap - overcoming Ethereum (ETH) overnight. No one knows if the situation will continue like this. Analysts believe that if a quick bullish run initiates, everyone might be able to 'forget' this sad Thursday for crypto. However, an action like that would force Bitcoin to immediately gain control over $6,000 and altcoins to follow, which is beyond impossible at this moment.
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Altcoin News

Crypto Market Suffers From A New $26 Billion Wipeout

In the latest cryptocurrency news, we have a new wipeout that has the crypto market suffering - and being one of the most intense daily sell-offs in all of 2018, where the market lost more than $26 billion in one single day. The price of Bitcoin, which demonstrated a high level of stability over the past 3 months, recorded a 11% drop within 12 hours, which was a decline that brought down many other altcoins and digital assets, triggering downward movements in the entire market. One of them was Bitcoin Cash (BCH) which suffered most yesterday, falling by more than 19% and losing about a fifth of its value. Over the past week, this altcoin has managed to drop by over 50% and lose half of its value against the US dollar and 40% of its value against BTC. The intensity of yesterday's selloff reached a point in which Bitcoin saw its trading volume doubling from $4 billion to $8.1 billion. Even though the volume rarely surpassed the $4 billion margin over the past few months, it now demonstrated a high trading activity because of the selloff. One respected crypto trader and analyst going by the handle DonAlt commented on the latest drop, stating: https://twitter.com/CryptoDonAlt/status/1062687627340587008 The price trend of Bitcoin has played out similarly to the trend that DonAlt laid out and small market cryptocurrencies managed to suffer against both Bitcoin and the US dollar. Throughout the first two quarters of 2018, however, tokens and small market cap assets recorded losses from 40% to 80% against Bitcoin. The recent losses of 15% to 20% managed to bring their total yearly losses to around 95% percent. Bitcoin is now trading at $5,645 - and analysts believe that a quick rally to $6,000 could recover it from this situation.
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Altcoin News

The 30% Share Battle: Hundreds Of Crypto Exchanges Compete For Market Share

In the latest digital currency news, we are focusing on cryptocurrency exchanges and a new report that shows that there are over tens of thousands of cryptocurrency exchanges around the globe - and only 187 of them are operational and active. The '2018 Research Report on Cryptocurrency Exchanges' issued by Timestamp Capital also points out the following:
“In a stagnant market, the head effect (a Chinese market concept similar to the 80-20 effect) is now more evident for cryptocurrency exchanges. The top 6 exchanges have over 3 billion in trade volume each and takes up 58.9% of the total trade volume. The top 14 exchanges have over 100 million in daily trade volume and takes up 73% of the total trade volume.”
As we can all conclude from the above mentioned, the rest of the two hundred (or so) cryptocurrency exchanges only have in total - less than 30% of the entire market share. Moreover, the visits to these exchanges are declining month by month, just like the bitcoin and altcoin trading activity. Bloomberg had recently reported that the leading exchange, Coinbase, has been hit hard and that its consumers trading activity has decreased by around 80% compared to last December. According to other statistics from CoinMarketCap, Binance trading volume peaked in January 2018 and has fallen 80% since then.
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