Gemini

Year of creation — 2015

Founders — Cameron and Tyler Winklevoss

Headquarters — New York, the USA

Usability

Undoubtedly, Coinbase seems like the most convenient option for buying and selling digital tokens for beginners. You can pass the simplest registration and start buying and selling coins at the declared value, whereas you need to get verified in Gemini (need some documents, photo, mobile phone confirmation). The whole process can take up to a couple of days. Furthermore, there are no such complicated for beginners terms like as, for instance, «stop limit» or «market order» in Coinbase. However wide functionality catch fancy experienced market actors. A huge toolkit breaks new ground for them.

Security

Both exchanges are especially picky about security matters. Customer funds are separated from company funds that they use for work. Two-factor authentication is used everywhere (password and mobile phone). It significantly reduces likelihood of a hacking. Both exchanges have its own security features (for instance, Coinbase — the site’s informational flow traverse through encrypted SSL — HTTPS, Gemini — two levels of cold storage).

Adding funds

The users can choose some ways to add funds. However the Coinbase’s choice is a bit wider. Coinbase gives an opportunity to replenish account using a credit/debit card or a bank payment. Gemini offers us to use exceptionally bank payment.

Commission

Coinbase fixed fee for all transactions — up to 200$. If user makes purchase using credit/debit card, the exchange will take 3,99% in commission fee. For other buyings or sellings — 1,49%.

It should be noted that bank payments are free (however debiting 0,15$). Some governments impose fractional limitations (for example, you can buy something only using credit/debit card in Canada).

There is no deposit fee for Gemini. Also there is a six-level commission system. The percentage is floating. It depends on how much BTC and ETH the user has sold and bought for the last month (starting from 1% and ending even 0%).

Gemini is much more profitable for traders due to low commissions.

Besides, It should be noted that the choice of cryptocurrencies in Coinbase is slightly wider than in Gemini (4 vs 2). It gives a definite advantage. However, as compared to other exchanges, both Coinbase and Gemini have no coin diversity.

Binance

Year of creation — 2017

Founder — Changpeng Zhao

Headquarters — Malta

Binance — worthy alternative to Coinbase. The exchange is actively developing now, so there are a lot of people who have already heard about it.

Coins selection

As articulated earlier, the choice of cryptocurrencies in Coinbase isn’t impressive. Bitcoin, Ethereum, Litecoin и Bitcoin Cash are represented there. The choice in Binance is much more wider. You can find hundreds of different coins there (for example, Monero, Cardano, Ark, Ripple).

Security

Coinbase greatly attends to security. User funds are well protected. 98% of them are stored in offline storage, the remaining 2% are insured. FDIC insurance guarantees users that funds in the amount of up to 250 thousand dollars will be recompensed in casе of unforeseen consequences.

Commission

Depending on the method of buying coins, commission fee on Coinbase ranges from 1,49% to 3,99%. If the investment amount is less than 200$, the commission can be higher. Binance has one of the lowest commissions among all exchanges — only 0,1% per trade. If the user uses Binance Coin, the commision will be reduced by half.

The situation with the interface and usability is similar to Gemini. Coinbase was made for beginners, Binance — for active traders, that’s why the toolkit of Binance is much more wider.

Summarizing all above-mentioned information, it should be noted that Coinbase has some differences from other exchanges. Firstly, a high commision. Secondly, not the largest coin selection. However it is the best option for beginners. It is really the right choice to enter this sphere. A good reputation and a high level of security will not make you doubt.

Holderlab.io is a cryptocurrency portfolio management automation software. It will help you to analyze your portfolio using the correlation matrix and the optimization method.

Coinbase alternative was originally published in holderlab.io on Medium, where people are continuing the conversation by highlighting and responding to this story.

Analysis in such conditions becomes impossible, the position of traders is removed from the market. The Fed’s cash infusion is $ 1.5 trillion per month and the base rate is reduced, as a result, money is poured into the market in order to stop the market from falling, but this may not be enough.

Oil war

In addition, a trade oil war was added to the coronavirus, and this could cause serious problems for US shale oil companies, whose production costs are $ 30–40. The US oil sector is sitting on a wild leverage, and as a result, banks that lend to them can start problems. Thus, is it possible to say that this is perhaps the best moment for cryptocurrency projects that can be competitive in comparison with the banking sector? Well, we still have to find out.

The fall of Bitcoin and the entire cryptocurrency market

Bitcoin’s collapse was stronger than the stock market for several reasons. Well, firstly, the correlation between the S&P 500 index and Bitcoin reached 1. If earlier Bitcoin was associated as a protective asset and did not have a pronounced correlation, now all markets have started to fall during a mass panic. By the way, you can check the correlation of your crypto portfolio for free at Holderlab.io

The search for liquidity as the beginning of accelerating the fall of cryptocurrencies

The reasons for the strong current decline in the cryptocurrency market may be due to the fact that stock market traders were looking for liquidity in order to maintain margin requirements. In this case, liquidity was sought in risky assets, those Bitcoins and cryptocurrencies, perhaps some traders went completely into the dollar. This is where the first wave of decline in the cryptocurrency market began.

Bitmex Margin Trading

The incoming wave from the reduction of positions in Bitcoin from stock market traders has demolished the position of margin traders on Bitmex. As a result, $ 500 million in long positions were liquidated in an hour, and it remains to be seen how many were liquidated for other trading pairs.

As a result, we saw a drop up to $ 3800. A great lesson for those who trade with leverage.

Another curious fact is that cryptocurrency exchanges do not have mechanisms to stop trading, as we saw in the stock markets when there was a limit down on S&P500.

Trading Bitcoin Futures on CME

In anticipation of the elimination of margin positions on Bitmex and other crypto exchanges. Starting February 25, there was an active closing of long positions in Bitcoin futures and opening short positions on the Chicago Mercantile Exchange. Which also influenced the fall of bitcoin as a whole. Cryptocurrency exchange margin traders have become a blast wave for the fall of Bitcoin.

Cryptocurrency trading strategy in a panic situation

Already today cryptocurrencies are sold at a significant discount, but now we are forced to monitor the dynamics of the S & P500 index and the general news background, which can affect the price of Bitcoin. However, in our opinion, the best moment for the Bitcoin HODL is probably coming. Today we see a good discount before the upcoming halving.

Do not expect the best price, it is almost impossible to catch, if it is possible to place pending orders this is good, today you can slowly buy current prices.

Trade managing your risks and do not rely only on luck and leverage.

Holderlab.io is a free service for automated crypto portfolio management with automatic rebalancing of assets (threshold or periodic), searching for efficient frontier and analysing assets using a correlation matrix and other crypto investments tools.

This article is not a recommendation for investment or investment in cryptocurrency, as well as perceived as investment advice. Be careful, because investing in cryptocurrencies is very risky and you need to consult with your financial advisor. Past earnings do not guarantee future earnings.

Bitcoin and cryptocurrency trading strategy in a panic on the coronavirus. was originally published in holderlab.io on Medium, where people are continuing the conversation by highlighting and responding to this story.

Ethereum (ETH)

Current value — $205,35

Capitalization — $22 563 648 817

The second most important digital currency and the brainchild of Vitalik Buterin — Ethereum opens the list of top altcoins to invest. The coin is still not thinking of losing ground. Unlike Bitcoin, Ethereum is not just a cryptocurrency, but a whole platform for developers. On this platform, there is the creation of smart contracts based on blockchain technology.

In addition, Ethereum is the most popular coin for conducting ICOs. Most project developers create tokens of the ERC-20 standard, which is the official protocol for submitting proposals for improving the Ethereum network (20 is a unique offer identification number).

The main challenge facing developers is to increase scalability. They assure that very soon they will overtake the Visa payment system and will reach a new level.

Litecoin (LTC)

Current value — $50,46

Capitalization — $3 242 491 236

Litecoin is one of the oldest digital currencies in the world. In 2011, former Google employee Charlie Lee created a coin that was supposed to be an alternative to Bitcoin. Compared to digital gold, Litecoin received a number of improvements, among which one can single out a higher transaction speed (2.5 minutes with LTC versus 10 minutes with BTC) and a lower commission.

This cryptocurrency was created on the basis of Bitcoin. Its main purpose is an alternative to fiat currencies (for example, dollar or euro). It is worth noting that the coin is actively developing. The developers are doing everything possible to make Litecoin easier to use in popular e-commerce platforms. The number of terminals accepting it for payment is constantly increasing. Therefore, according to experts, Litecoin is one of the top altcoins to invest.

EOS (EOS)

Current value — $3,14

Capitalization — $2 887 666 549

EOS is a relatively new coin. Dan Larimer, one of the founders of the Bitshares cryptocurrency exchange, is also the creator of EOS. In 2017, an ICO was launched. During the company managed to raise about a billion dollars. Many investors then agreed that EOS is on the list of the best altcoins for investing.

The main difference from Bitcoin is that EOS is not only a coin, but also a blockchain platform designed to create decentralized applications (DApps) and smart contracts, therefore it is reasonable to compare digital currency with Ethereum. Ethereum uses the Proof-of-Work (PoW) mechanism, while EOS uses the Delegated Proof-of-Stake (DPoS). That is why EOS is more scalable than Ethereum.

Another obvious advantage is compatibility with many popular programming languages (including C ++). Ethereum is only compatible with the specific Solidity language.

EOS developers are now actively working to ensure that the coin can fully realize its potential. By the way, the investor has already managed to get good dividends.

Chainlink (LINK)

Current value — $4,29

Capitalization — $1 501 648 824

The platform is developed on the basis of the Ethereum blockchain. The main purpose is the relationship between smart contracts and external data. Chainlink is one of the latest milestones in the development of blockchain technology.

In 2015, Ethereum was created. With the advent of this project, smart contracts first appeared, which proved to the crypto community that the industry may not be limited solely to financial transactions. However, Ethereum had one serious drawback — smart contacts work only within its blockchain. Chainlink oracles, in turn, are able to collect data outside the chain. They use any sources around the world (for example, data sets, APIs, payment systems, stock exchanges). The oracles ensure the reliability of data provision through direct interaction with information sources.

The project has certain problems. The issuance of a billion tokens exceeds the potential activity of users, which prevents the coin from growing in value. In addition, funds after an erroneous transaction are non-refundable. However, the advantages of Chainlink eliminates all the disadvantages of the project. Investors are sure that developers will be able to bring to mind the platform and it will continue to develop successfully.

Tezos (XTZ)

Current value — $2,56

Capitalization — $1 913 016 316

The list of the top altcoins to invest would not be complete without Tezos. It’s one of the most controversial blockchain projects in history. His journey began with powerful sponsorship and a well-known development team, after which serious problems began that resulted in litigation and internecine war. However, later the situation returned to normal, and the project was nevertheless implemented.

The main difference from many other projects is that the Tezos blockchain was created by developers from scratch. It is not based on the code of any existing blockchain, that is, it is not someone’s fork. The main idea of the developers was to create a blockchain that is not subject to hard forks and is able to become a kind of springboard for innovation.

Like other altcoins, Tezos is able to work with smart contracts. This uses the DPoS mechanism, as in EOS. At the moment, there is a minimum computational load on the network and a minimum dependence on the participation of miners.

Despite conflicts in the team, the project received a response from many investors. Its main advantage is the lack of the possibility of a hard fork. The system is designed in such a way that the community is engaged in improving the project, and not undergo constant splits. Of the minuses, it can be noted that the system code is written far from the most popular programming language Ocaml. Because of this, fewer developers are able to improve the project. In addition, the unlimited issue of coins at the ICO depreciated them a little, but there are much more advantages than disadvantages, so the project continues to be actively supported by investors.

Summarizing the above, we note that altcoins are still an attractive investment tool. Extensive functionality makes them much more useful and promising in the foreseeable future. It is worth noting that new altcoins appear every month, so a prudent choice of altcoin can bring good benefits to investors.

This article is not a recommendation for investment or investment in cryptocurrency, as well as perceived as investment advice. Be careful, because investing in cryptocurrencies is very risky and you need to consult with your financial advisor. Past earnings do not guarantee future earnings.

Top altcoins to invest was originally published in holderlab.io on Medium, where people are continuing the conversation by highlighting and responding to this story.

Let’s see how you can experiment with cryptocurrencies in the backtest module of Holderlab.

Cryptocurrency backtest dashboard

A dashboard consists of a block of cryptocurrency choices, starting with Bitcoin, Ethereum, XRP and many others. Select cryptocurrencies manually using the (+) button or use the search.

To find cryptocurrencies of interest related to cryptocurrency exchanges, select a connected cryptocurrency exchange: Binance or Huobi or others. The list of cryptocurrencies for selection will correspond to the selected crypto exchange.

Top 4 Most Popular Cryptocurrency Hub Articles:

1. The Crypto game

2. New Crypto Game on the Block!

3. The Bitcoin Bubble Explained to a Couple of Four-Year Old Twins

4. A Crypto that will Pay You

Cryptocurrency Testing Toolbar

Let us consider in more detail the top toolbar of the testing unit, which consists of:

Start date — select the start date of the test.

End date — select the end date of the test.

Add amount — allows you to choose a starting balance of $ to start testing.

Rebalancing options — allows to choose a strategy for rebalancing cryptocurrencies. Rebalancing strategies include a choice between threshold and periodic rebalancing.

Load portfolio — select early saved portfolios.

Read more about rebalancing strategies here: https://docs.holderlab.io/knowledge-base/threshold-rebalancing-assets/

Cryptocurrency backtesting software

Let’s test an example of a cryptocurrency portfolio and look at the results.

1. Choose assets, as an example we will take the first four cryptocurrencies: BTC, ETH, XRP, BCH. The amount of assets should be equal to 100%.

2. Select the test parameters, the initial deposit and the strategy of periodic rebalancing. In the example, rebalancing is selected 1 time per week and 5% threshold.

Cryptocurrency backtesting results

Test results are expressed graphically with the ability to switch between USD and BTC.

The module illustrates the deviation of each crypto asset in%.

The final test results and detailed parameters for each cryptocurrency.

Don’t forget to give us your 👏 !

How to backtest a cryptocurrency portfolio? was originally published in Crypto Currency Hub on Medium, where people are continuing the conversation by highlighting and responding to this story.

NEO cryptocurrency

• What is NEO?
• NEO price
• Where to buy NEO cryptocurrency?
• NEO GAS calculator

EOS crypto

• EOS cryptocurrency
• How to buy EOS?
• EOS price
• EOS blockchain

What is NEO?

NEO is a cryptocurrency smart asset platform one of the first blockchain projects from China, the progenitor of which was the Antshares platform.

The NEO cryptocurrency is really a large blockchain project that works on the basis of a smart economy. Users who using the NEO blockchain and digital identification can register, program and trade several types of assets.

NEO price

График NEOUSD предоставлен TradingView

You can choose any pair to NEO, including Bitcoin NEO / BTC, NEO / ETH and various fiat.

Where to buy NEO cryptocurrency?

Basically, a NEO coin can be bought on cryptocurrency exchanges such as: Binance, OKEX, Bitfinex, Kucoin, Poloniex, Bittrex, HitBTC, Bibox. Easy to analyze the portfolio including NEO with Holderlab.io.

NEO GAS calculator

Direct mining of NEO is not possible, and the issue of NEO is limited to 100 million coins. 50 million coins frozen and will be used to develop the NEO system.

The remaining 50 million were distributed among ICO participants, so new NEO coins will not be issued.

In this regard, the GAS cryptocurrency was developed, which is a cryptocurrency inside the NEO system and which is subject to emission. GAS itself is built on the principle of Proof of Stake, all participants of the NEO system receive the bonus from the conducted transactions in the form of GAS tokens. Therefore, in order to receive GAS, you must store NEO in your official wallet.

You can check the reward as the amount of GAS on official sites.

EOS cryptocurrency

EOS is a platform for developing decentralized applications with a very high transaction processing speed. More than 100,000 transactions per second). EOS token is included in the top 10 cryptocurrencies by capitalization. Cryptocurrency EOS uses the Ethereum-based ERC-20 protocol. EOS mining is not possible. The protocol DPoS (Delegated Proof of Stake) was introduced here very reliable and democratic

How to buy EOS?

You can become the owner of tokens only by purchasing them on the exchange. EOS highly liquid coin. Can be exchanged for fiat and other cryptocurrencies on most crypto exchanges.

• Binance
• Huobi Global
• OKEx
• Bitfinex
• HitBTC
• Kucoin
• Kraken
• Poloniex
• Bibox
• Bittrex

Since EOS uses the ERC-20 protocol, it is possible to store cryptocurrencies on universal wallets. For example Exodus, MyEtherWallet or hardware Ledger Nano S.

EOS price

График EOSBTC предоставлен TradingView

EOS is mainly traded in pairs such as: EOS / BTC, EOS / USDT, EOS / ETH.

EOS Blockchain

Cryptocurrency EOS uses an efficient and fairly reliable consensus algorithm on the Blockchain-DPoS network. Delegated Proof of Stake is different from Proof of Stake. They work in completely different ways. The general principle of work is directly related to voting, those who own the EOS have the right to vote. It affects the choice of “witnesses”, who then verify transactions and block validation. In simple terms, DPoS is a democratic and truly decentralized system. DPoS used in Steem, Bitshares too.

Summary NEO vs EOS

NEO is a big threat to ETH, as it enjoys the support of the Chinese government. Cryptocurrency NEO developers can use such popular programming languages as Java, C ++. NEO has an internal GAS cryptocurrency that users can earn or use for other needs.

EOS uses one of the reliable systems on the blockchain, the Delegated Evidence System (DPoS). Cryptocurrency EOS is fast in network transactions. EOS also has more significant market capitalization, than NEO.

Check the correlation between EOS and NEO using the free cryptocurrency correlation matrix in Holderlab.io

Correlation between EOS and NEO

The correlation at the 2-year distance between NEO and EOS is quite high.

Thus, both NEO vs EOS have their own advantages and disadvantages, so our verdict is a draw. Two of these cryptocurrencies deserve the right to be in the portfolio.

NEO vs EOS was originally published in holderlab.io on Medium, where people are continuing the conversation by highlighting and responding to this story.

Cryptocurrency investment decisions

Firstly, one of the biggest gifts that an investor can afford is a strategy that can eliminate emotions from investment decisions. Such a strategy is to rebalance the crypto portfolio.

Secondly, it is worth noting that for rebalancing, the distance or horizon of investment and the degree of risk tolerance are important.

Cryptocurrency investment horizon

By investment horizon I mean a period, it can be 1 year, 3 years or more. An investor, first of all, needs to decide and follow his investment period, since in most cases rebalancing will not give the desired effect over a short distance. However, the cryptocurrency portfolio, in view of its high volatility, can show good results at a distance of 1 month, therefore it is important to monitor and monitor your cryptocurrency portfolio.

Also read: The Best Crypto Trading Bots

Why rebalancing a crypto portfolio?

So what does rebalancing do with the portfolio? Rebalancing is the restoration of the original structure of a crypto portfolio. Let’s look at an example of rebalancing a cryptocurrency portfolio.

Rebalancing smooths the profitability of our crypto investments, forcing us to buy low and sell high. Rebalancing a cryptocurrency portfolio is a tactical tool that allows you to bring the shares of cryptocurrencies in a portfolio to their original allocation. Rebalance is not a goal, it is just a mechanical tool. In Holderlab, we implemented manual and automatic rebalancing by period and threshold; we will talk about this further.

What types of rebalancing of the cryptocurrency portfolio exist?

Manual balancing. You decide when you need to restore balance if you think the time has come or there are enough deviations. Unfortunately, we must exclude emotions and adhere to clear rules when making investment decisions. Let us consider in more detail two other types of rebalancing — threshold and periodic.

Threshold rebalancing of the cryptocurrency portfolio

The threshold rebalancing of cryptocurrencies represents the moment when one of the cryptocurrencies in the portfolio reached a certain level of growth, for example, at the level of 5%, and we rebalance this crypto portfolio.

Let’s look at the test result of the above distribution of cryptocurrencies:

5% threshold rebalance

Result: P&L — 117.68%, Max.drawdown — 79.87% (due to the fact that our test portfolio is not too diversified)

Further, we suggest looking at a chart of all possible distributions of threshold rebalancing and their profitability and maximum drawdown.

As we can see from the distribution diagram of the threshold rebalancing, we did not begin to calculate the rebalancing beyond the threshold of 6%, since the drawdown of the portfolio became more than 95%. Obviously, we will not be able to allow such a drawdown value and this is also probably due to the diversification of our portfolio and correlation.

Look at the correlation of this crypto portfolio.

Correlation estimate for 1 year. We see that three of our four assets are highly correlated with each other. Which, as a result, affects the size of our drawdown.

Periodic rebalancing of the cryptocurrency portfolio

Periodic rebalancing is a strategy when you need to rebalance your portfolio at different times, for example, once a week or once every 5 hours.

As we see the return of the portfolio is quite restrained with an increase in the hourly period of rebalancing. Portfolio drawdown does not grow exponentially, as is the case with threshold rebalancing. The decrease in profitability and the increase in drawdown, as we see, occurs starting from the 8 hour rebalancing period.

Daily and weekly periodic rebalancing

As we see, the drawdown has increased significantly compared to the hourly periods, while the risk and profitability are comparable to the threshold rebalancing values.

Summary

In this article, we examined the principles of rebalancing and the need for its use. Our test portfolio was not very diversified, and part of the assets correlated strongly with each other. In the following articles, we will look at the diversification of crypto portfolios and their relationship with risk and profitability.

Attribution

This article is contributed by Holderlab.io, with the help of Holderlab, you can automate your strategy for automatically rebalancing the cryptocurrency portfolio. You can choose manual, periodic or threshold rebalancing of the near-currency portfolio. Rebalance your crypto portfolio for free now.

This article is not a recommendation for investment or investment in cryptocurrency, as well as perceived as investment advice. Be careful, because investing in cryptocurrencies is very risky and you need to consult with your financial advisor. Past earnings do not guarantee future earnings.

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Rebalancing Strategy For Your Crypto Portfolio was originally published in Coinmonks on Medium, where people are continuing the conversation by highlighting and responding to this story.

What is an optimal crypto portfolio?

This portfolio is balanced in terms of risk and return with a maximum Sharpe ratio. The Sharpe ratio is an indicator of the effectiveness of the investment portfolio, the higher it is, the more the portfolio will bring a return on investment.

We at Holderlab.io automated the process of structuring the portfolio and optimizing it using the effective frontier method, for which the author of the method, Harry Markowitz, received the Nobel Prize. This method is widely used by portfolio managers, hedge funds.

However, we use a not quite classical method. We analyze from 5,000 portfolios, the purpose of which is to find the minimum volatile portfolio, the most volatile portfolio and one the most optimal one.

How do crypto investors structure their crypto portfolio?

Often weights are distributed proportionally.

Example A: Bitcoin — 20%, Ethereum— 20%, XRP—20%, Bitcoin Cash— 20%, USDC — 20%

Or preferring top cryptocurrency.

Example B: Bitcoin — 40%, Ethereum— 20%, XRP — 20%, Bitcoin Cash — 10%, USDC — 10%

We will test that two crypto portfolio using the backtest module in Holderlab and look at the results.

Testing parameters: Start date: 01/01/2019; End date: 31/12/2019; threshold rebalance: 3%

Results of example A with proportional portfolio:

Results: P&L — 11.82%, Max. drawdown — 37.26%

Results of example B with proportional portfolio:

Results: P&L — 26.03%, Max. drawdown — 36.38%

Now we will optimize our portfolio using the effecient frontier. Holderlab analyzes over 5,000 portfolio variation to find the best portfolio with the highest Sharpe ratio. We carry out the analysis using the optimization tool on the Holderlab.io

Portfolio distribution weights is

After optimization, our allocation became as follows: Bitcoin — 69.8%, Ethereum — 1.51%, XRP — 0.34%, Bitcoin Cash — 26.78%, USDC — 1.57%

The allocation of XRP turned out to be extremely small and we will not consider it further, we will allocate XRP proportionally to the entire portfolio. Also, when rebalancing, small allocations will cause an error.

Let’s look at the test results.

Results: P&L — 69.66%, Max. drawdown — 35.2%

As we see the result of the crypto portfolio increased by 57.84% and the drawdown decreased by 2.06% not so much, but as we see our test portfolio was weakly diversified.

Bitcoin brought us the greatest return in 2019.

We have developed a crypto portfolio optimization tool so that you have the opportunity to maximize the Sharpe ratio of your crypto portfolio in 2020. Try it now for free in Holderlab.io

Follow Holderlab.io on

Twitter: https://www.twitter.com/gotoholderlab
Facebook: https://www.facebook.com/holderlab/
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Our blog: https://www.blog.holderlab.io/
Website: https://www.holderlab.io

However, we cannot predict with sufficient accuracy the risk and profitability of such a portfolio. But what can we do to make our crypto portfolio optimal for holders?

What does an optimal crypto portfolio mean?

This portfolio is balanced by risk and return. This is when the optimal combination of each asset in the portfolio affects the improvement of profitability and risk reduction in the portfolio.

We at Holderlab.io created a tool that automates the process of structuring a crypto portfolio.
One of the main methods of portfolio optimization was the method of modern portfolio theory of Harry Markowitz. This method is used by most portfolio managers, institutional investors and hedge funds.

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However, we decided to increase the number of analyzed portfolio groups from 5,000 to 50,000 options for possible portfolios in order to find the best one.

Let’s start optimizing our crypto portfolios

First, let’s look at an example with a proportional distribution of cryptocurrencies in a portfolio.

Our test portfolio:

Bitcoin — 60%

Ethereum — 10%

XRP - 10%

Bitcoin Cash — 10%

USDC — 10%

Testing parameters: Start date: 01/01/2019 End: 20/11/2019; Test balance — $ 1000; Rebalancing — 5% threshold rebalancing Let’s test.

Results: P&L — 74.47%, Max. drawdown — 47.33%

Now let’s look at the results with portfolio optimization. We are looking for the perfect balance between risk and return, in accordance with Markowitz theory, which results in optimal asset weights. This tool automatically calculates the weight in the portfolio and selects the best among more than 5000 portfolios.

And this is our crypto asset allocation.

Now we have our optimal weights and let’s test it the same period.

Results: P&L — 89.43%, Max. drawdown — 43.95%

As we see the result of the crypto portfolio increased by 14.96% and the drawdown decreased by 3.38% not so much, but as we see our test portfolio was weakly diversified.

Let’s look at detailed optimal portfolio:

Bitcoin brought us the greatest return. Stablecoin also allowed us to reduce drawdown.

Summary

We have developed a tool that allows you to find the maximum sharpe ratio and collect optimal portfolios. You can optimize your portfolio for free in Holderlab

Follow Holderlab.io on

Twitter: https://www.twitter.com/gotoholderlab
Facebook: https://www.facebook.com/holderlab/
Telegram: https://t.me/holderlab
Our blog: https://www.blog.holderlab.io/
Website: https://www.holderlab.io

Don’t forget to give us your 👏 !

How we will diversify the crypto portfolio in 2020? was originally published in Crypto Currency Hub on Medium, where people are continuing the conversation by highlighting and responding to this story.

Every one of these exchanges for quite a long while involve a main position and figured out how to acquire the regard of a huge number of clients.

Binance exchange

Binance cryptocurrency exchange appeared in 2017 and is a moderately new player among other market participants. Despite the fact that the site is young, due to a well-coordinated team and flexible development, the cryptocurrency market immediately received one of the market leaders. As indicated on the CoinMarketCap website, Binance is by and large the most flexible and most liquid exchange and pioneer in the entire cryptocurrency volume.

The organization’s central command is located in Hong Kong, and even now it is much more legally reliable than its American partners. The trade commission is moderately low — 0.1% of the exchange. A separate BNB coin was made separately, which allows to further reduce actually small commissions. An easy to use interface is available in many languages, including Russian, English, Spanish and French.

Binance decentralization exchange

Despite the principle of the best cryptocurrency trading, there are various platforms in Binance, one of which is the decentralized cryptographic cryptocurrency trading Binance DEX, a fully autonomous Binance Chain blockchain in which the BNB token acts as the main installment block. Although its liquidity is not high, the trade itself was launched only this year. There are also Binance products operating in different countries, such as Binance Jersey, Binance US and Binance Singapore. Binance is the foundation on which Binance Lab is based. The goal of this division is to distribute blockchain extensions and increase the capabilities of existing products.

Kraken exchange

The most famous trade in digital currency in this brief overview is Kraken, which appeared in stock in 2011. The historical background of the development of trade is rightfully identified with the absorption of various transactions, including uncontrolled ones. To this day, the kraken is highly respected in the cryptocurrency market.

The crypto trade offers cryptocurrency exchanging with more than 107 instruments. Notwithstanding, you can be certain that if any coin jumped on this trade — all is well with it, in light of the fact that before you get into Kraken, the makers of the coin must experience an exhaustive check. Kraken bolsters fiat monetary standards of EUR, USD, GBP, JPY, CAD and stablecoins USDT and DAI.

Kraken is gone for both a wide group of spectators and huge players with the help of OTC digital money exchanging.

Huobi exchange

Speaking about the best cryptocurrency exchange, one cannot but notice the mammoth — Huobi. Appearing in 2013, trade has increased widespread distribution for the most part among Chinese users. In 2017–2018, Huobi immediately entered the global market and figured out how to win a large number of customers around the world.

Day by day exchanging volume surpasses one billion dollars, because of which the trade positions second as far as exchanging volumes, which demonstrates high liquidity. Huobi is additionally one of the pioneers in the quantity of cryptocurrencies — their number is 540. For the comfort of clients, its own HT-token was created. HT-token aides in the advancement of the trade, yet additionally decreases the commission for exchanging activities

Trading in Huobi is well known for its high level of security, which means that you need to make a lot of efforts to get confirmation and crediting. In any case, after passing the verification, a large number of exchange options will become available to you immediately, including the useful universal mobile application.

Kucoin exchange

In 2017, a new exchange was founded, like Binance. Among the applicants, Kucoin is different, most importantly, with a large selection of cryptocurrencies — there are more than 400 in trading them. The second, in addition to this, is quick access to the market — you must register, but there is no need for confirmation, in any case, if you do not plan to exchange large volumes.

Customers note that a huge number of people regularly engage in trade development. This is observed with the technical update of the exchange and the absence of any special errors and trading stops.

Poloniex exchange

Just a couple of years ago, this cryptocurrency exchange was the most popular for buying and selling cryptocurrencies, but after a while, applicants slightly replaced it from an initiative position.

A huge number of exchange sets and low fees attract customers. Poloniex effectively suppressed hacker attacks and successfully resisted numerous hacks.

Trading Poloniex has a nice and convenient basic interface. Indeed, even an inexperienced young man can understand how to use trading instruments in just a couple of minutes. In addition, if suddenly something remains unclear to you — usually you can turn to specialized help, unfortunately, only in English. The Poloniex team has also resumed the popular Trollbox group chat.

Coinbase Pro exchange

A really old and well-known cryptocurrency exchange is becoming more convenient for customers who are going to buy and store cryptocurrency. Only 7 cryptocurrency options and 1 stable coin are available to customers: BTC, ETH, BCH, BAT, ETC, LTC, ZRX, USDC. Read more about top 10 cryptocurrencies for investing in 2019

One of the fundamental favorable circumstances of Coinbase Pro is the withdrawal of funds in US dollars, euros and pounds sterling.

One of Coinbase’s goals is to turn cryptocurrencies into a payment gateway. In 2018, they received permission to work with cryptocurrencies, just like they plan to acquire a banking license. Trade gives protection assets in dollar accounts of up to $ 250,000. Coinbase also excels in quality help.

Bitfinex exchange

Hong Kong trading Bitfinex is suitable for beginners in the field of cryptocurrency trading. Bitfinex is genuinely engaged in producing a wealth of instructional tips. In addition, continuous specialized assistance is available to all customers who are ready to clarify all the difficulties of working with trade.

Trading offers traders a huge number of pointers that greatly encourage exchange. Read here about the best incredibly working cryptocurrency trading strategies in 2019.

A huge number of paper currency exchange kits are on offer.

OKEX exchange

Cryptocurrency trading in OKEX now ranks fourth in terms of exchange volume. During a peak period of time, a normal day to day volume reaches two billion dollars. Like Binance, OKEX issued its own token to pay commissions within the transaction.

The security audit framework includes several levels. In order to withdraw funds, you must be at an entry level, but in order to work with Fiat, you must provide more information.

Trading fees range from 0.01% to 0.15%. In total, more than 470 cryptocurrencies are registered on the exchange.

HitBTC exchange

Another Hong Kong exchange, which is in the top 10 cryptocurrency exchanges, which means that trade has huge volumes of exchange and high liquidity. From favorable circumstances, convenient tools and, accordingly, favorable trading conditions can be noted. The site has a profitable and instinctive interface.

A huge number of tools are available to customers, with the exception of operations with fiat. The platform is in demand among the main positions of cryptocurrencies using ICO and IEO.

Bittrex exchange

Bittrex is rightfully among the top ten due to its high level of security and large volume of exchange. Of the pluses, it is important to note the possibility of storing and recovering assets in US dollars, in countless cryptocurrencies, there are more than 200 of them.

The exchange is governed by US law, and there are certain requirements regarding finances and especially cryptocurrencies. Thanks to this, all customers can be sure of the safety and well-being of their assets on the Bittrex exchange.

Best cryptocurrency exchange

These are 10 best cryptocurrency exchanges in our opinion, but this does not mean at all that only their services are worth using. All these exchanges are connected to the holderlab.io service, which allows to automatically compose a crypto portfolio and rebalance the portfolio at once on several crypto sites. Opening an investment portfolio, you can choose any suitable option, having considered other options. Be careful, as investments in cryptocurrencies carry certain risks

Top 10 cryptocurrency exchanges was originally published in holderlab.io on Medium, where people are continuing the conversation by highlighting and responding to this story.

Trezor provide “cold” storage of cryptocurrency and practically eliminate the risk of hacking.

In addition, there are lighter web versions of cryptocurrency wallets.

For example, Blockchain.com wallet, which does not require blockchain downloads and is easy to use.

Define a personal investment crypto strategy for yourself.

First, before buying cryptocurrency, you must decide on the purpose of buying bitcoins or cryptocurrencies: for long-term storage or for trading.

Secondly, cryptocurrency is best stored in a wallet. Especially when it comes to long-term storage. When you trading, the currency balance is immediately replenished.

Method 1 to buy bitcoin and crypto: peer-to-peer exchanges

It is considered the most reliable way to buy cryptocurrency.

Exchange takes place directly between users without intermediaries, and the exchange acts only as a guarantor of the transaction.

When exchanging cryptocurrency, it is transferred to the internal account of the exchange. After which it can be withdrawn to a wallet and saved.

In other words, it is suitable for long-term storage.

Pros

• Quick and easy sharing
• High level of transaction security
• No trade commission for the buyer
• Large selection of payment methods, including cash and through crypto machines
• The ability to generate income on the buy bitcoin or other cryptocurrencies and sale of cryptocurrencies

Cons

• Unprofitable exchange rate
• Additional fees for withdrawing funds

Popular P2P exchangers:

• LocalBitcoins
• Paxful
• Cryptolocator

Telegram bots:

• BTC Banker

Method 2. Crypto Exchange

Crypto exchangers provide cryptocurrency from their own reserve. Exchange time depends on the type of exchanger: manual or automatic.

Сryptocurrency exchanges conduct a transaction within 15 minutes, and manually orders can be processed up to an hour or more.

Pros

• Large selection of exchange directions: bank cards and transfers, payment systems, cash and altcoins
• Cryptocurrency arrives immediately to the wallet

Cons

• Unprofitable exchange rate and high commissions
• There are risks of fraud.
• Slow exchange

A list of the most reliable exchangers can be found at BestChange.com.

They check cryptocurrency exchangers in real time and sort offers by given criteria.

Method 3. Cryptocurrency exchanges

This method allows you to instantly convert cryptocurrencies into altcoins or fiat at the most favorable rate. It is also recommended to use crypto exchanges for exchange.

If you plan to trade cryptocurrency or store for a short period (up to several weeks).

Crypto exchanges are suitable for storing several assets that can be managed in a single cabinet and easily adjust the crypto portfolio if necessary.

Holderlab.io will help to create a balanced cryptocurrency portfolio with portfolio optimization and automatically rebalance.

The service provides work through the API with 10 popular crypto exchanges and allows you to test your portfolio on historical data.

Pros

• The most profitable course
• Low trading fees
• Fixed trading fees, which for many altcoins are a few cents or less
• The ability to earn income on the difference in rates

Cons

• Cryptocurrencies, such as Bitcoin and Ethereum, have high fixed fees. This makes exchanging small amounts unprofitable. This must be clarified in the “Trading Commission” section of your exchange.
• Funds on the exchange do not belong to users and may be lost if hacked
• Few exchanges support fiat currencies

Popular secure crypto exchanges:

• Binance
• Coinbase Pro
• Kraken
• Huobi Global
• KuCoin
• Bitfinex
• HitBTC
• Bittrex
• Poloniex

Method 4. Buying through Bitcoin ATMs

This method is not very popular, but is actively developing. Similar machines already exist in Canada and the USA.

This avoids the risks associated with traditional ATMs.

You can find the nearest Bitcoin ATM using the CryptoATMRadar service.

Pros

• Transaction Security
• The ability to buy bitcoins for cash anywhere in the world, including foreign currencies, or with a credit card
• High transaction speed

Cons

• Not the most convenient way to exchange
• ATMs are located mainly in large cities.

Method 5: Cash Purchase

The method is not a recommendation for use. You must personally know the person or trust him. This operation may carry risks.

This method allows you to buy bitcoin on individual terms without any intermediaries.

If you decide to buy Bitcoin for cash from another person. Importantly, follow simple rules to ensure safety:

• Assign a crowded meeting place: cafe, waiting room or shopping center.
• Arrange a money transfer to a bank account or card to exclude the possibility of theft of cash.
• Upon arrival, evaluate the surroundings: is there anything suspicious.

Pros

• No additional fees
• The course may be more profitable than exchangers
• Ability to track the entire transaction procedure

Cons

• Risks of fraud and theft of funds
• Inconvenient, time-consuming method of purchase
• There are no security guarantees.

5 best ways to buy bitcoin was originally published in holderlab.io on Medium, where people are continuing the conversation by highlighting and responding to this story.