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How to Gauge the Cryptocurrency Market Trend?

How to Gauge the Cryptocurrency Market Trend?

There are more than 1,500 listed cryptocurrencies trading around the world currently compared to just 617 before the start of the last year. The interest towards the segment has increased after unimaginable returns from the digital coin sector in 2017. It’s not easy to gauge the trend of the virtual currency market, and mostly bitcoin and Ethereum were looked like the possible leads. However, that is set to change now once the CryptoIndex comes into force anytime now. This should address the pattern of price movement among the different coins.

Much Needed One

Though there has been enough interest for the cryptocurrency market after a stupendous last year, there was not much effort in establishing a separate index on the lines of any other traditional financial markets. Significantly, not every digital currency exchange has listed all the digital coins that are in existence since they are widespread with different methods and modes of payment. The timing is a crucial factor for a trader dealing with any market be it stock or commodity or the virtual assets.

As the adoption rate of cryptocurrencies is getting wider, the interest is also steadily growing though it is not reflected in the pricing of different digital coins. At the same time, prospective investors and traders were worried about the complexity of the virtual currency market apart from the exposure to associated risks. Therefore, the need to have an index for the digital currency segment has been felt for quite some time like any other conventional markets.

The creation of CryptoIndex would undoubtedly be viewed as a serious and viable opportunity for investment as stock markets are trading close to lifetime highs in most of the countries. This meant that professional investors, hedge funds, banks, and heavily regulated asset managers could look at the possibilities of entering the digital currencies market. This would also lead to a wider base of an investor in the virtual asset ecosystem, newsbtc.com reported.

However, these sophisticated old-school investors would not be enticed merely by the index, and they might expect the regulatory compliance requirements to protect themselves. That is required when it comes to any new asset classes or contracts and gets listed. Aside from that, multiple listings that included current financial exchanges like CME would enable the use of fiat currencies by investors.

AI Powered

CryptoIndex is powered by artificial intelligence (AI) created specifically for the purpose of establishing a benchmark for digital currencies. This is also called the Cryptoindex 100 and the Zorax unique algorithm use data from different sources. The objective is to establish an exceptional method for a complete calculation of an automated index. The inputs fed through neutral networks would steadily revalue every crypto asset as part of the index.

Though the current market cap is about $300 billion in respect of cryptocurrencies, experts see it reaching $10 trillion in future. That is because of the anticipated increased adoption rate of digital coins. Therefore, the index would play a key role in identifying the right kind of virtual assets in the changing world.

About the author

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Jay Wilson

Fred is a successful entrepreneur and investor. His passion to share his knowledge and to analyse the highly unregulated cryptocurrency market brought him here. His experience gives him a strategic edge amongst others.

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