SharesPost Token index down 63 percent since inception, gains ground in February
After a rough 2018 for crypto valuations, we are starting to detect a heartbeat. The SharesPost Token Index gained 27 percent in February, the best monthly performance since its inception. The index and Ethereum both enjoyed greater gains than Bitcoin in February, with Ethereum posting a 27 percent increase and Bitcoin gaining 11 percent.
Binance Coin (BNB) was overwhelmingly the best performer in February, jumping 90 percent in the month. The currency probably benefited from a coin burn that started last month, announcements of both the Binance Chain and Binance DEX projects (including a TestNet launch in February), and a number of successful Binance Launchpad-fueled sales. Basic Attention Token (BAT) and the Internet of Services Token (IOST) also posted notable gains of 49 percent and 35 percent respectively. IOST also launched its mainnet in February.
The list of tokens which lost value was refreshingly short, with only Holochain (HOT) and Zilliqa (ZIL) posting losses-- 18% and 5% respectively. These results were primarily driven by market volatility, and both tokens were doing relatively well before a drop towards the end of the month. Still, the losses were relatively light compared to what we have seen in the past months.
Regulation: The Securities and Exchange Commission continues to drag its feet in drafting clear crypto regulation. Notably, the commission has yet to decide whether to approve a number of proposed Bitcoin exchange traded funds (ETFs). Meanwhile, the Israel Securities Authority (ISA) recently published a report that seems to lay the groundwork on how regulators should oversee crypto coins. Other foreign securities agencies have taken similar actions. We will continue to monitor the SEC for any guidance.
Institutional Entry: Major financial institutions have made a number of moves, which should, in aggregate, help move the industry forward. First, Fidelity Investments launched its much-anticipated crypto custody business. While still in the early stages and only available to select clients, such a solution to hold crypto assets represents a significant advancement for the industry. Goldman Sachs is also developing a custody solution. J.P. Morgan last month announced its “JPM Coin” project. Based on a private and proprietary version of Ethereum called Quorum Blockchain, the bank will use the coin to settle transactions between clients of its wholesale payments business. The token marks the first time a major U.S. bank has launched a digital coin.
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