There has been a changing of the guard since our last newsletter. Obviously Bitcoin is firmly ensconced at the top of the leader board but it no longer dominates as it once did, commanding only 45% of the total value of the cryptocurrency market. Bitcoin after reaching an all time high of $64,800 on 14 April has been languishing at around the $55,000 to $57,000 mark although it has been edging closer to $60,000 in the last few days. Ethereum finally broke away from its habit of tracking the price of BTC hitting yet another all time high of $3,991 on 9 May. But the change of guard occurred below the top two. Binance moved into third place with a market value of $102 billion followed by Dogecoin at $62 billion. Dogecoin makes tulip bulb mania look like a pin prick on a white elephant, despite the $20bn wiped from its value after Elon Musk appeared on Saturday Night Live, the opposite reaction to what the comunity was expecting.

Turkey made the crypto news when two of its largest crypto exchanges closed abruptly with one founder disappearing with up to $2 billion in client money. The Turkish government has placed a ban on cryptocurrency as a payment option citing reasons including crypto’s association with crime and its unregulated financial market.

There is a reason why the alternative blockchains such as Binance Smart Chain, Polkadot and Polygon have seen massive price increases in their native cryptocurrency. Ethereums high gas price has led to many projects opting to build on alternative chains. And whilst the team at Ethereum say they are working on it the problem persists. It is one of the biggest gripes in the altcoin space right now. If you want to invest $100 into a moonshot and have to pay $50 in gas that is a big ask when similar Binance Chain based platforms are charging a fraction of this. Although a solution is imminent this continued delay has allowed other chains a chance to gain a foothold in a market Ethereum had practically sewn up. In the recent sell off Ethereum’s price has been less volatile than many of the other assets, including bitcoin, reaching an ATH amongst the red ink possibly because the market believes in Ethereum’s bright future.

Our latest report looks at the most promising projects on the Binance Smart Chain. Read, Crypto Moonshots on Binance Smart Chain here.

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Listen to our latest podcast where we discuss three possible moonshots from the storage space

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Uniswap is the largest decentralized exchange in crypto. However because of the high gas fees on Ethereum this has allowed competitors such as Pancakeswap, who reside on Binance Smart Chain, to thrive. Uniswap v3 launched on May 5. However it is not expected to see an immediate reduction in gas fees. The three biggest changes in the protocol are concentrated liquidity, revised fee tiers and price oracle developments. Gas fees are expected to come down thanks to Optimism, an Ethereum based second layer solution to be deployed after v3 launch. When exactly is anybody’s guess right now.

Bitcoin dominance is the technical term for bitcoin’s market value against the value of the total market of all cryptocurrencies expressed as a percentage. For many years this figure has been consistently around the 80% mark however with the rise of numerous cryptocurrencies and the launch of thousands of new projects that figure has fallen by a massive 20% since the start of 2021, it now stands at around 45%. This is a demonstration that altcoins are gaining in relevance. This trend is only going to continue.

Bitcoin takes another step towards mainstream acceptance

JP Morgan has announced that it is to offer an actively managed bitcoin fund to its private wealth clients. It will become the largest bank to embrace crypto as an asset class. This news comes on top of the eight applications with the US’s Securities Exchange Commission for a bitcoin Exchange Traded Fund.

If there is one thing that the recent mass crypto sell off taught us is that we should always invest in quality rather than the next metoo memecoin or blockchain platform. There are over 200 different blockchains all of them supposedly offering something a bit different. And of course some will make it but in reality many will just end up languishing. Of course if you are in the speculation game then that doesn’t really matter too much. If however you are focused on searching for long term value, as many HODLers are, then we must focus on projects with convincing USPs.

Contrary to popular belief though attempting to predict the success of a project isn’t all about analyzing the technology. The majority of project websites or pump posts on forums focus solely on the technology, literally blinding us with science. Rarely do you see any mention of adoption. When a project has been live for some time as an investor we should be looking for the number of users, total value locked and AUM or Asset Under Management.

The problem is many projects are reluctant to reveal this information. The best way to obtain these important statistics is to ask the project team directly, on their Telegram channel is a good way. If they refuse to answer you then take this as a big red flag and avoid. The other morning we contacted a prediction market project called Stox. On the face of it the project looked a good one, it appeared both undervalued and undiscovered, our favorite kind. Our opinion quickly changed when we asked the team how many users they had and they flatly refused to answer. Apart from being rude it was also a clear sign that they have something to hide. We put that one in the garbage can where it belonged.

Last month we produced a number of sector reviews. These reviews identified particular sectors which we believed offered potential including identifying specific possible moonshots within each sector.

Here are the sectors we wrote about and the related articles.

Find all of the CryptoQuestion reports here.

Whoever invented bitcoin is now one of the top 20 richest people in the world. However although bitcoin is a $1 trillion economy, blockchain itself, which was formed on the back of his or her invention, has spawned a $2 trillion economic movement. And in reality it doesn’t really matter who Mr Satoshi Nakamoto is, for he or she created something that didn’t require his involvement after that initial coin was minted. The trustless economy was born. This month we dedicate this newsletter to Mr Nakamoto.

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  • We do not own any of the cryptocurrencies which we discuss.
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  • Discussion of a particular cryptocurrency does not constitute a recommendation to buy.
  • Always do your own research.
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  • Remember cryptocurrencies and in particular smaller cryptocurrencies are extremely volatile. You could lose 100% of your investment.

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Not Financial Advice

This article does not constitute financial advice or a recommendation to buy in any way. Always do your own research and never invest more than you can afford to lose. Investing in cryptocurrencies is high risk, and you could lose 100% of your investment. The article should be treated as supplementary information to add to your existing knowledge.