Despite the prevailing negative sentiment in Crypto markets, the SharesPost Token Index actually rose in January. The surprise performance marks only the second time the Index has grown since its inception and comes just two months after BTC and ETH suffered big losses, declines of 37 percent and 43 percent respectively in November.
Tokens HOT, NPXS, and LINK led the Index in rank order. HOT increased 2.5x during the first month of the year driven thanks to the launch Holo Mainnet and its founders’ decision to exchange the token on a 1:1 basis for Holo Fuel, the new network currency. NPXS holders will receive 65 percent of a new token dubbed “f(x).” Since the f(x) token will not be available for sale, speculators likely clamored for NPXS to be included in the f(x) distribution, in turn driving its price higher.
Conversely, OMG, PPT, ZRX saw the largest respective declines in January with OMG losing nearly a quarter of its value. Market sentiment, not any one material event, likely drove the fall. However, the drop-offs were not too severe, at least by Crypto standards. Investors may see the slowing rate of declines as a sign of good things to come. Perhaps the bottom is in sight.
Only HOT and LINK reside in the black since the Index debuted last year. Both tokens saw robust increases in value this past month, pushing their performance well above their Index peers. By contrast, ETH has lost over three fourths of its value over the last six months, perhaps due to delays in the Plasma upgrades and the general dearth of coin offerings.
January was one of the least volatile months for the Index since its inception. The Index increased a modest 3.6 percent over the course of January, a welcome change to the chill of this Crypto Winter. We will continue to monitor digital asset prices and will look for multi-month consecutive growth before we are confident that market sentiment has changed for the better.
Investors had expected ETH founders in January would finally upgrade the third most valuable cryptocurrency by market cap. Constantinople was supposed to go live once miners mined the 7,080,000th block on the Ethereum blockchain around January 16. However, the day before the scheduled upgrade, programmers discovered a security flaw, prompting another code audit. ETH founders ultimately pushed back Constantinople to the 7,280,000th block or roughly February 27, 2019. Nonetheless, ETH creators said other upgrades, namely Casper, will proceed on time.
Other notable developments include a potential Bitcoin custody solution by Fidelity Digital Assets, which could come to market as early as March. Also, the CBOE re-submitted the VanEck/SolidX Bitcoin ETF proposed rule change while TokenSoft launched its beta enterprise custody solution for security tokens and cryptocurrencies.
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