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You can also use market cap to take snapshots of company or cryptocurrency groupings. That gives you the market cap for that sector. Similarly, do the same for a group of cryptocurrencies. Take the privacy coins, for instance, calculate their market caps, and add them all together. That number gives you a picture of the value of the privacy coin space. You can use the sum of individual market caps to estimate the market caps of an entire sector.
However, these cryptocurrencies also potentially have more room for growth. Your challenge is to determine which of these low-cap coins could bring as much value to the world or close to as much value as Bitcoin has. Another aspect of cryptocurrency market capitalization to consider involves market manipulation. Small market caps lend themselves to price manipulation more readily than large caps.
Bad actors exploit small market cap coins by controlling enough of the total supply to create large price movements in one direction or another. Cryptocurrency market capitalization provides no information regarding the future direction the price will take.
No part of the equation determines the future coin supply. Instead, the code defines whether the system will mint future coins. And If so, at what pace. Some cryptocurrencies cap the total supply of coins while others create an infinite supply. The Bitcoin network caps the total number of bitcoins at 21 million. As for Ethereum, Vitalik Buterin speaks favorably of a system where existing Ether gets burned out of the available supply to avoid inflation.
Not all rare books command a high price. A capped supply guarantees one thing: all the variation in the market cap comes from price since supply remains fixed. Market cap in and of itself tells us nothing about the velocity or direction of the coin, whether explosive growth or gradual decline.
But, calculating market cap over a period of time could reveal trends. For crypto, the number of dead coins is a unique factor that also influences the market cap. Some people lose their wallet. Bugs in the code also cause lost coins.
Hackers steal crypto, and in some cases may not be able to redeem the coins. The market cap approach belongs to the fundamental analysis field of stock market investing. Fundamental analysis seeks to calculate the value of a company to determine future rewards. This strategy involves long-term thinking and looks for growth in value over time. On the other end of the spectrum, technical analysis focuses on short-term trends, and price fluctuations play a more important role than long-term valuation.
If an investor using technical analysis believes the price of a stock or cryptocurrency will skyrocket over the next week, that constitutes a good short-term investment regardless of market cap. The value could sink to zero next year, but a short-term investor would not care. Limitations to using traditional stock market analysis like market cap arise when you realize these techniques serve to analyze companies. Bitcoin exists as a software system to enact financial transactions in a decentralized context, not as a company.
Similarly, Ethereum provides developers with a platform to create decentralized applications and organizations. Ethereum helps to create companies, but its own central mission does not involve seeking profit and increasing its revenue.
When people invest in Bitcoin, to a large extent, they bet on a particular vision of the future. They believe the world will move to crypto, and Bitcoin appears to hold the strongest claim on that version of the future. And something that I think is worth noting is that everything you see on nomics.
So there's no back doors, there's no hidden in points. We're consuming this exactly like a customer is. So we're a big believer in dog fooding and being a customer of our own products. And that was one of the rules that we put in place from day one, is that we couldn't do anything with our app that our customers couldn't do with the free version of our product. Brian Krogsgard: Nice. So at a baseline you are providing data specifically around coin data at a high level and then very specific data in terms of pricing on a daily basis, and I think an hourly basis at a core.
I think what I actually asked you all about in that thing was whether y'all could do So that was something else that y'all were looking to add and now people can use this to build something just like nomics. Brian Krogsgard: This is essentially just a massive data feed, but instead of me going and saying, "Hey, I want this data from a Poloniex. Your dealing with all the hassles of getting data off an exchange, so that I don't have to integrate with every single exchange in the world and instead I integrate with Nomics and I'm good to go.
So I think you summarized that correctly. I think kind of accompany that were similar to is a company called You know what actually, I won't get too much into that. So basically, one of the The problem that we're solving for is a problem that kind of came up a lot in conversations when we were talking to hedge funds and family offices and institutional investors, which was, they'd hire a pretty fancy developer to do data science work, to find edge and opportunities in the data sets.
And their developer that they'd hired for that purpose would end up spending much of their time rather than finding opportunities in the data set, just maintaining those data sets. So if you spend much time at all ingesting data from these exchanges, you'll find that ticker symbols change from exchange to exchange, and then the exchanges themselves will change a ticker symbols. They'll change their data schemas without telling you, their data feeds will turn off and then they'll come back on again, there's lots of downtime.
Clay Collins: And so if you're just ingesting data from one of these exchanges and you're okay with dealing with just a bunch of friction, then I think it's probably okay. The second you want to ingest data from multiple exchanges, things get a lot trickier. And when we started in this business, we just Clay Collins: Exactly, exactly. So you're having to integrate with more and more of these exchanges to get an accurate picture of what's happening-.
Brian Krogsgard: So the long tail The long tail of a global trading is getting larger basically. Clay Collins: Yep, exactly. So there's lots of just real oddities when integrating with these exchanges. For example, some exchanges when their APIs go down because of the way they're cashing works, they just persist the last candle. So they'll give Other exchanges do things like We were looking at an exchange the other day that had a market called USD Like what the hell is going on here?
There's just a lot of bizarre stuff happening in this space. So we wanted to create a super professional lightening fast API and that's what we're solving-. Brian Krogsgard: Out of of curiosity on that exact pair, were they basically seeking to provide a trading pair between to different stable coins in order to smooth the market on their own platform? Clay Collins: So one of those was the [inaudible ] market and one of those was a stable code. You just didn't know which-. Clay Collins: Because The blend of stable coins is super interesting to me, like the way And trying to find out like what's gonna be supported, how do we measure stuff like that.
I even saw one the other day where So they are creating kinda index funds on the go and one of their funds is actually a stable coin blend. So if you buy their stable coin blend, I guess their whole point is like you're buying the average of all the stable coins so that it will be stabilized to stable coin mix to be even closer to a dollar.
Brian Krogsgard: There's just a lot of effort going into people trying to call a dollar a dollar in crypto, which I And I think it's perhaps just a bit of a signal for how difficult data is in not only this space, but pretty much any space.
And I'm fascinated by this play because there's so much opportunity I think as the ecosystem grows and I never had heard what you said earlier about just how much trading is going on on the long tail. Because when you think about like, "Hey, where are people trading crypto? You hear that they're on Binance and that they're on Coinbase and to a lesser degree, Bittrex and Poloniex, and then you've got some Asian exchanges that are doing a lot of trading, but you don't actually know if it's real for some of them.
Brian Krogsgard: And keeping track of all of it is really difficult. I come from a development background. You come from a web background. I actually knew who you were in your prior company, which is Leadpages by the way, for anyone listening from the web space. So how did you transition from building a big company So that's a great question.
So to speak to my previous history or what I was doing before this, my first software company was a company called Leadpages that was started in January of From to , we grew that to about 50, paying customers. We raised 38 million in venture capital, hired hundreds of people, had a really good go there.
Something I realized about myself is that I think I cap out at around people in terms of company size and my ability to manage at scale. At some point you're managing people and then you're managing people who manage people and then you're managing the people who manage people who manage people. And I really liked that spot of like between 80 people to people.
So perhaps I can scale beyond that with my second software company, but at some point I just kinda went to the board and said, "Hey. I think we should hire a CEO and I can stay on the board. So I started-. Brian Krogsgard: So you're on the board of Leadpages today and Clay Collins: Exactly, yeah.
I'm not going into the office and I mean I'm officially chairman of the board, but that's kind of a nice honorary title. I asked for it. Clay Collins: They were nice enough to me. So one of the things that I saw in the marketing tech space, which was really fascinating, was just how a data got So when you first started using marketing tech in the space, someone would use something like Infusionsoft or HubSpot or Salesforce and everything would be in one place.
But then as the space exploded about every single year, the number of martech companies doubled. So folks found themselves sort of originating a place where everything was in their CRM or everything was in their email service provider, to a space where they had to open And then they had information about who attended what webinars in a place like Zoom or GoToWebinar. And then they had They had payment data in something like Stripe and they had information about what webpages people are visiting in a place like Google Analytics.
Clay Collins: And over time, the data just got more and more distributed and it became harder to know what was actually happening in terms of the view of the customer and what they were doing across all these different SAS products that you were using to run your business. And as that happened, there became a real desire to integrate all these different systems and that became a real challenge.
And at that time, I got really interested in data platforms and customer data platforms where Brian Krogsgard: So essentially, you have your customers in all these different places and then the hard part is saying, "Well this singular customer data over here and this singular customer data over here, we want to bring those together so we can get the profile of who this customer was, both in terms of what they've bought. But also how they've interacted with our website or app.
And then also like how they treat our emails and stuff. Clay Collins: Yeah, yeah. What pages they visited, what emails they've opened, what webinars they've attended, what You know. Clay Collins: All that stuff and tracking their behavior before you even have an email address or some sort of identifier. So while they're anonymous users onto So all this sort of post-purchase information and stitching together a unified customer timeline of everything they did across this timeline.
And I saw the same thing happening in the crypto space, again with lots of consolidation in data. At first there was just a handful of exchanges that had most of the volume and then over time, that data being more and more distributed. And hearing from developers that every time they add a new integration to the system, it made the system exponentially more complex because they had to deal with these different systems going up and down in the interaction between systems and maintaining the integrations and all that.
Clay Collins: So we are not a blockchain company. We're not issuing a token. This is an API business. This is a really kind of "boring business", but I think that's kind of in my DNA. I'm a product person and I'm in this for the long haul.
And it's kind of these companies that other people find boring, I find immensely interesting. Almost these online utility companies that charge on a metered basis, that's kind of my sweet spot and where I derive the most amount of interest. And I think the opportunity for us is that these are often things that most people just aren't interested in because they find them to boring. And there's a lot of What do you You probably know the term for this, but like where degradation and data over time.
So I like to use the example of metal just 'cause it's one I remember of being listed on Bittrex and then listed on Binance later and then de-listed on Bittrex, but it's still on Binance. And this is only over the course of whatever the last year that it's existed. We have no idea how this data might happen for an open source Brian Krogsgard: So I've seen people I say metal because that's the example I know where it has this history of Bittrex and it was way higher than it ever showed on Binance and I've seen people show a chart of metal on Binance and they're like, "Wow.
This thing is so destroyed, like it's so far off the top. But people are essentially lacking information to then make a decision because they don't have all of that aggregated. So one of the things that y'all do, because you're pulling it from Bittrex and Binance, you're piling that into your global average over time and you're essentially providing data security for this asset and every other. For as long as you exist, you have that central source of truth if someone can use for making decisions.
Clay Collins: Yep. And you know, one question we get from folks who don't spend a lot of time looking at data is, "Doesn't QuidMarket cap have this data? Don't other sites like maybe Live Coin Watch have this data? They don't have candlestick data. For the most part, those services are just ingesting live tickers as the data comes in. They don't have historical trade data. They don't have the kind of data that a real trader would want to observe if they're going to create a bot for example.
They may have I've actually poked around several of the APIs that are out there. CoinMarketCap in particular, if you're building something really baseline where you're okay being somewhat right limited and you're gonna go cash all that, you can get stuff like 24 hour volume on a coin or you can get like current price or the percentage of the supply that's out, stuff like that. But getting detailed data of everything that's happened over the past or lifetime of the coin, like several years sometimes, it gets a lot more challenging with anything.
And then also just the quirks between all the dIfferent exchanges and everything that they support, and that seems to be kind of where y'all are attacking this. So I'm super interested in this, but what I am What is hard to figure out is where the heck are you gonna make money and why are you doing this 'cause the Everything you do on nomics. I'm not necessarily trading based on what you have there. So where do you start to make money? Who do What kind of people do you charge if I can build something like nomics.
Clay Collins They're mostly institutional traders, quantitative hedge funds. Folks like that. What they're paying for is the raw trade data. When you want every individual trade, then you have to pay us or if you want some custom integrations or if you want SLAs and high level support or you want us to do some custom development work for you-. You're saying you'll be up We don't persist the last candle if their API is down even though they're doing it. We'll just mark it as a zero and then we'll backfill it.
If you're just consuming the live data feeds, they don't repair their data. We go back in and we get after the fact. Those are the folks that pay us. What that allows you to do is it allows you to create your own candles. If you decide you want 38 second candles, you can do it because you have the raw trades. You can construct everything. Something that some folks want are like volume candles.
They don't want candles based on like every hour or every four hours. They want million dollar candles. Actually they're doing a lot of the stuff that they won't even tell us. Clay Collins: I'm a product person, so when someone buys our product, I'll go in and ask them, "What are you doing with this data? Sometimes we get a little insight when we do onsite visits and stuff like that. Pretty cheap in the scheme of things given the size of folk's data budgets.
We'll probably move to a metered plan in the future. Brian Krogsgard: Okay. What would a metered plan look like? Would that be from there and higher or lower the bar? Clay Collins: It would be like it's just sort of pay as you go. Ala carte. If you want to make a lot more calls, then you'll pay for those additional exposure to data. Brian Krogsgard: How do you bring exchanges on to participate to this?
We've got about a dozen. The reason why we only have a dozen right now versus having a lot more is for kicking things off, we only wanted to work with exchanges that give us raw trade data. That allows us to calculate our own candles versus us believing their candles. We've just found fraud. I can talk about that for a second.
I'm not going to name an exchange, but the kind of fraud that we see most frequently occurring is when trades happen like far above the spot price. You've got the bid ask spread. You've got the spot price, which would be a market order. It would be the bid jump way across the ask and purchase something like way over here.
Clay Collins: So if you see those charts it's like jumping across the gap. So they'll be really paying some absurd amount for bitcoin, or whatever the crypto asset is, but buying a tiny amount of it at some insane price, and we're like there's no way an order book should let this happen. So that's what we see most frequently. Brian Krogsgard: I've seen that specifically when people list a coin.
They do that weird stuff and you see the massive first bar for some unknown reason. Then two other scenarios I've seen, one was when Binance had the Syscoin hack and shenanigans that they did recently, someone stole 11 Syscoin for 96 BTC each. I don't know if they skipped through the entire order book, like if it was just thin so that they spiked it to that level or what.
But then the other scenario that I've heard that's fascinating to me is sometimes you can do that through exchange APIs because a lot of times the way you show an order book in a RESTful API is actually it shows every single one and then you can pluck the individual order. Brian Krogsgard: So it allows you to essentially skip the order book, whereas typically a limit order's going to choose the lowest one or a market order is going to pull from the bottom or whatever.
But I've heard there's some exchanges where they have funkiness in their API that would also allow something like that. If you have really thin markets and you put in a market order then it could just be that it blew past all the sell orders and jumped to some super high price. But I can see what you're talking about with the APIs. You can pluck a specific order, although I don't know why someone would do that.
That would just make no sense. So it could just be a crappy programmer somewhere. But I don't know why a crappy programmer at a hedge fund is buying Syscoin for several bitcoin each. I just can't see any-. Brian Krogsgard: Yeah, I think in that example it was something related to the hack that they had and it was just a hot mess.
Brian Krogsgard: I am curious. Y'all have a ton of data between the pricing data, candle data, exchange rates I'm just looking through some of your documentation right now. Since you came from a marketing background, how did you even know like here's the data that we need to put into this API? How do you know what to provide and how to build it? Clay Collins: Yeah, so I'm a product person first and foremost.
So we get it by talking with customers. But we're also traders ourselves. So we know it from that perspective and we create stuff that we want to dog food ourselves. It's really about talking to customers a lot, doing stuff like we did with you on Twitter where you asked for a feature and like okay, we're going to build it. Or when we're talking to customers sometimes they'll say "Hey, we want this, but in order for this to really work for us we need you to add this additional thing.
Clay Collins: So it's just about talking with the customers all the time and I'm on the phone multiple times per week with institutional traders, developers and trying to learn everything I can about making a solid product. I think kind of the DNA you have to have to make this kind of product is very different from the average product in this space. There's a lot of hackathon developers. There's a lot of kind of young dudes in their 20s spitting stuff up over the weekend.
And to create a data product and a data platform I think it requires a certain level of discipline. So every single line of code has a unit test that covers that code. Brian Krogsgard: Which means, for non-programmers, that means that what he says is going to happen has been tested via a whole nother slate of programming tools to verify that that's what happens, because he said it was going to happen.
I don't know if that described that well. Clay Collins: Yeah, we have just as much code testing the app, as the app itself. Which means that myself as a non-developer, my CTO or someone else on the team will often send me a version of the app and I'll log into GitHub and deploy to production without anyone manually testing it. So it's just a certain level of rigor. It's not something that most people have the stomach for because it's slower at first, but it pays off in spades down the road.
Brian Krogsgard: Let's take a break, say thank you to our partner for this episode, Delta. Go ledgerstatus. This is the best way to track your portfolio in crypto, bar none, guaranteed. And you know they've got some great new features. The last two releases have just been chock full of stuff. Live order books and depth charts, number one on the request list for people that I've talked to who said that they like Delta but they want more.
That's the biggest thing they've wanted. You've got that now. Brian Krogsgard: I think they support like a dozen exchanges so that you can see the actual order book, the depth charts, recent trades, all that stuff, right there in the app. It's really great.
They've just released portfolio analytics as well and I've thought this was really cool because I can go back and it'll actually tell me, if I'm a pro user it tells me even more, but it tells me stuff like what exchange are my coins on or what wallet is it in and it gives me these really nice graphs with all of that information, with a lot of analytical data.
It also even tells me what's a good trade or a bad trade. So if I sold something and it's gone down since then it'll tell me hey that was a good sell because it's gone down since then. Brian Krogsgard: It gives you some insights on your past decision making to let you know if you've done a good thing or a bad thing with that trade.
Just give you a little more information about your trading and so that you can learn more to be a better trader. Brian Krogsgard: Delta's really awesome. They're always working on cool stuff. Somebody may be listening to this and they might just say okay, so you want to provide data for hedge funds or for traders or people that want to build something like nomics. You have to be dreaming up more that this will be, in terms of the entire market, beyond a whole bunch of weird crypto assets that most should die.
Other than Bitcoin, Ethereum, and some large caps, do we really need this data? What else do you imagine in terms of being able to fit into your ecosystem? You have a grand vision of the future it seems.
Clay Collins: Yeah, totally, totally. There's a couple of functions that we want to serve. One is want to be like the internet archive of the new financial system. So archiving all of these dead coins, all of these markets that have expired, we want to tell the story and the history of what was happening when all of this started to come onto the scene. I think a second thing is that Perhaps this is overkill for what we have right now, but what we're intending to build is the data backbone for the new financial world, for the open financial system.
Clay Collins: And we take that very seriously. Also, the think right now there's not a lot of data. Perhaps there is. We've indexed billions of trades. And multiple versions of local bitcoins that are reporting their data. Then OTC desks. And then add to that security token exchanges. Clay Collins: So imagine someday every single local coffee shop, pizza shop, anyone who wants to fundraise in this way, every single building in your city has a token and that token is perhaps traded on some kind of local exchange, there's just going to be an explosion of exchanges.
And then add to that order book data. So data for orders that haven't been filled or have been canceled or maybe the order's been placed and that order converts to an actual trade and then add to that blockchain data and you have a huge undertaking in terms of-.
Brian Krogsgard: And that's all underlying physical product. That's the asset itself. That doesn't even get into a future where there's derivative products or futures or options. There's a whole nother set of trades and orders and everything. So y'all want to support all of that someday right? Clay Collins: Oh, no, and we are. And we have specs to handle that right now. So if you're from a blockchain project, if you're from an exchange, if you're from an OTC desk and you want to integrate your data with us, let us know.
We have specs for you to write to. If you can stand up three endpoints, pretty simple endpoints, we can give you a heck of a lot of exposure. So yeah, we're doing all of that and then add to that different indexes. So each of those bots are going to have their own rankings.
There's quite a future. Brian Krogsgard: This seems like an exponential explosion of data that's going to be on your ecosystem. How are you looking to be able to scale that? Like is this built on just a regular old database?
I mean what's this look like? Clay Collins: So kind of the latest is using Kafka and Cassandra and that's what we're building on. We're not using Microsoft Access. Clay Collins: Kind of these large nonrelationable wide column store databases that can handle trillions upon trillions of data points. That's how you got to do it. Brian Krogsgard: And then I don't want to get too much in the weeds. There's no rate limiting. So we cache the hell out of our endpoints.
So you can hit us as hard as you want. We don't care. Go nuts. A lot of people charge quite a bit for these sort of uncapped non rate limited APIs, but yeah we won't rate limit. That's another thing that no one else will do that we do is we don't rate limit. Brian Krogsgard: And you're just assuming either that it's worth eating the cost for now or the cost is somewhat nominal for now. Do you expect your pay customers will be able to absorb that function for the long haul? Clay Collins: So a couple things, one, we're really good at caching.
Second, we just want to win in the short term. So we want people to feel comfortable using us and third, I'm funding this myself. In the long term, the way we're modeled the big cost is not that we're not rate limiting it here, it's engineers. Brian Krogsgard: Right. We probably could have led with this but I think people have probably gotten the picture by now, but this is a centralized business with a open API and there's no token.
There's none of that stuff. You're not a crypto project. Unless someday maybe you tokenize nomics. But this is a normal old business, not like a blockchain project itself. It's not token based or anything like that. Clay Collins: Right.
Yeah, so we're using centralized databases. We're a centralized company. I'm a big believer in that not everything needs to be decentralized or run on a blockchain and I actually think that what we're doing is kind of a horrible candidate for the blockchain. It's a terrible blockchain use case. You want millisecond response times on APIs. Yeah, you probably don't want to use a blockchain. So yeah, at some point maybe we'll tokenize equity of the company and let people buy a piece of what we're doing.
But for now this is kind of We want to be really good at the boring basics. And that's what we're focused on. Brian Krogsgard: In addition to all of this you're doing a podcast called Flippening. I just listened to a three part series that y'all put out about security tokens and probably tripled my knowledge of not only I kind of had an idea of what security tokens potential was, but more about who are the players within the security token landscape and what do they envision and how do they differ from each other.
So people might hear of Polymath because it has a token, but people should also be aware of something like Harbor and they provide a different type of service than what poly does. Bruce Fenton was on your show, who's a big Ravencoin guy.
Brian Krogsgard: And they're going to have stuff on top of a platform on Ravencoin, but he created a security token for his company on Counterparty through bitcoin. There's already all these tools for security tokens, so you just did this huge deep dive, why are you spending I thought about how much time Clay must have spent making this podcast, because each episode's got half a dozen guests, edited down into the questions.
How much time are you spending on this stuff and why? What's your basis for doing such an in depth series like that? Clay Collins: All in, that was at least hours. I'm embarrassed how much time that series took. Yeah, so that was just one of these stupid ideas where I was like I want to do an audio documentary.
I had heard a really good audio documentary about cryptocurrencies and there was a part of me as a product person that respects the craftsmanship that said to myself I want to create something that is like planet money level content for the cryptocurrency space about security tokens. Clay Collins: And kind of the genesis of that was I interviewed one company. I interviewed Polymath about security tokens and I got just this fraction of a picture of what was happening and then I realized there's exchanges, and there are issuers, and there were just so many regulatory bodies and there was so many different components to this.
Because there's already a pretty mature financial system that deals with securities already, so I couldn't do just one interview. So I started booking all these interviews and then I realized that it was too late. Once I interviewed the people now I had a commitment to publish them, but it didn't make sense to publish all these interviews by themselves because they really didn't stand on their own.
I needed to weave a narrative through it and then I need to write a narrative, which means I need-. Clay Collins: -storyboard out the whole thing. It was really a pain in the ass, but the interesting thing is, after I finished that, I figured out what my workflow was for creating these, and I've realized I kind of figured out how I could do one in a third of the time next time, so I'm probably going to be doing another stupid one here in the future. Brian Krogsgard: So, is the purpose behind these that you just want to share what you're learning and traditional podcast stuff?
Or is this marketing for Nomics? Clay Collins: Yeah, it's marketing for Nomics. It's really the only podcast for institutional crypto-investors. There's no podcast that has more listenership and more coverage from the institutional crowd than Flippening. That's exactly who our target audience is. Everyone who's paid for the API so far has [inaudible ] the podcast. Clay Collins: Because I don't have a big content marketing team, we can't churn out a bunch of thought pieces or tutorials.
There's just me. If I can do one thing that's going to attract the kind of audience that I want to get, what can I do? It was create this podcast because I started evaluating how much time does CoinDesk spend to put on Consensus or Consensus Invest? And it's millions of dollars. I've thrown big events before. Clay Collins: Yeah, and they make millions of dollars too. But having come from the event business, I bet they're just doing better than break even. That's my prediction.
I could be completely wrong, but I bet they're just doing better, even with how it's monetized. I bet you they're just doing a little bit better than break even. In New York, in Times Square, that's my prediction. Brian Krogsgard: Yeah, I've run small events, and it's enormous energy and very little money is what it ends up as most of the time. Yeah, so I was doing the stats on my podcast, and every single episode was getting about 50, downloads. I was like, "There was 12, people at Consensus Invest," so I bet I'm getting just as much coverage with that podcast from this very niche institutional investor crowd.
The ROI for me really made sense. Even though it's a pain in the ass that I love to do, I'm probably going to still continue doing it. Brian Krogsgard: Who do you consider an institutional investor in the space? What's an institutional investor to you?
Clay Collins: Yeah, so I define institutional as someone who raises money from other parties to invest it on their behalf. Clay Collins: Usually they've filed as a sort of a Reg D fund or they're usually regulated in some way, so they're not just playing with their own money.
A family office is technically not an institutional investor, but some of these family offices have billions under management, so it's kind of like they walk like a duck, they talk like a duck, and they have that level of rigor to what they do. They've got an entire staff and stuff.
Yeah, institutional investors are-. Brian Krogsgard: What are some of the big lessons that you've learned, based on the people you've talked to, in terms of what's most concerning to an institutional investor? And let's level that up, the higher-end ones. For instance, I know custody is an issue for real institutional investors, whereas, for a lot of people with a little less on the line, they can kind of manage custody in-house.
But if you're a regulated entity, custody becomes significantly more important. What kind of lessons for those types of people do you think you've been able to come up with? Clay Collins: Yeah, so custody is definitely the big one. That's where good OTC desks come in.
Bitcoin enjoyed a good ride prior to the holiday and enjoyed continued success as a result. Does a higher price necessarily equal value? Not necessarily. Stock market analysts use the market capitalization of companies to make informed investment decisions. Market capitalization market cap simply defines the current share price multiplied by the total number of existing shares. In cryptocurrency terms, this means the current price of a coin times the total number of coins in the market, often referred to as circulating supply.
Assume TickleCoin mints coins to where the supply now contains 2,, without any change in price. As a general rule, this shows us the amount of investment risk involved. Stocks categorize broadly as small cap, mid cap, and large cap as the market cap increases.
Small cap companies inherently present more risk because of potential company failure. However, they yield tremendous reward to early investors when they succeed. You can also use market cap to take snapshots of company or cryptocurrency groupings.
That gives you the market cap for that sector. Similarly, do the same for a group of cryptocurrencies. Take the privacy coins, for instance, calculate their market caps, and add them all together. That number gives you a picture of the value of the privacy coin space. You can use the sum of individual market caps to estimate the market caps of an entire sector. However, these cryptocurrencies also potentially have more room for growth.
Your challenge is to determine which of these low-cap coins could bring as much value to the world or close to as much value as Bitcoin has. Another aspect of cryptocurrency market capitalization to consider involves market manipulation. Small market caps lend themselves to price manipulation more readily than large caps.
Bad actors exploit small market cap coins by controlling enough of the total supply to create large price movements in one direction or another. Cryptocurrency market capitalization provides no information regarding the future direction the price will take. No part of the equation determines the future coin supply. Instead, the code defines whether the system will mint future coins.
And If so, at what pace. Some cryptocurrencies cap the total supply of coins while others create an infinite supply. The Bitcoin network caps the total number of bitcoins at 21 million. As for Ethereum, Vitalik Buterin speaks favorably of a system where existing Ether gets burned out of the available supply to avoid inflation.
Not all rare books command a high price. A capped supply guarantees one thing: all the variation in the market cap comes from price since supply remains fixed. Market cap in and of itself tells us nothing about the velocity or direction of the coin, whether explosive growth or gradual decline. But, calculating market cap over a period of time could reveal trends. For crypto, the number of dead coins is a unique factor that also influences the market cap. Some people lose their wallet.
Bugs in the code also cause lost coins. Hackers steal crypto, and in some cases may not be able to redeem the coins. The market cap approach belongs to the fundamental analysis field of stock market investing.
Kucoin is a transaction API designed to make accessing and trading on the crypto market much easier. They give you access to a wide range of different crypto currencies. They also help users by listing the more reputable and easy to use currencies before lesser-known or less valuable forms of crypto currency.
The exchange rate remains relatively stable, which also helps protect your users from some of the volatility that can plague the crypto market. However, this API does have some performance issues surrounding payments and trades getting held up. The system includes a referral bonus for users, but bonuses and other internal payments can take too long to process.
Crypto Compare is one of the best crypto API if you're looking to create something that could be used by a large corporation or an enterprise-sized organization. It's also a good choice if you're looking to create a high-use app. The API as a whole is currently handling more than trades per second, 40, calls per second, and sourcing news from 50 different reliable providers.
The API is also robust, with scalable endpoints that help you match the demands of your project to the resources used. Every transaction is secure, as are user connections to the API. They provide a free version of the API for individual use. Nomics is another very large API with access to over 66, different markets your users can access to complete their trades and to find the best possible prices for each currency.
The average response time of this API is only 51 ms, fast enough that your users will probably note the speed of the functions provided by this API. The API also allows to create a variety of additional functions beyond a simple exchange currency. Like a stock exchange app, the API also provides portfolio valuation tools to help your users know whether their portfolio is moving in the right direction.
If you choose and are looking to create a publicly available crypto currency app, you can also make this functions available to users. There is very little latency with this API, allowing for near-real-time trading. There are also no rate time limits, and the developer provides uptime guarantees for developers and users. There is a reason it gets consistently good results and high reviews.
They provide a variety of different ways to view and interpret market information and currency trends, as well as a running count of the current supply of each currency type. You can also access currency valuation at a glance, making it easier to see where each currency stands, regardless of the additional tools. This API is probably one of the biggest aggregate sources of crypto data. However, it does work as an exchange platform as well, though less effectively than some of the other API that are designed specifically for exchange purposes.
The best crypto currency APIs offer multiple different ways to access the information, as well as different representations of that information. On the other hand, there are some API that are incredibly specialized into only a single function. These are usually better than crypto currency API that only have two or three features since single function API do the one thing they do particularly well. The volume of trades usually doesn't matter for individual users, since almost no individual user will be able to overwhelm the capacity of an API.
Not to mention that those high-volume trade API also have to optimized for more up-time and to be more consistent in their overall performance or they would have a lot of frustrated users. Fortunately, crypto currency API are generally well optimized for even inexperienced users, so most are fairly easy to implement.
If an API in this niche is consistently getting bad reviews for being difficult to use, steer clear. Pricing for crypto currency API is less about the price itself, and more about matching the price to the needs and resources of your project. Historical Data is one of the single most important features for a market exchange API. The further back the historical data provided goes, the more likely it is to be a reliable source.
Crypto currency API are powerful and flexible tools that are designed to make it not only possible but easy to access the crypto market. Pay more attention to the functions you need instead of just the best rated or the most versatile options. Of course, you should also keep an eye out for highly scalable options in caser the scope of your project grows. Scalable API let you meet the needs of the project over time, without having to change to a different program and potentially lose clients in the process.
You should also consider looking into additional features, like IP Geolocation , that can add greater versatility to your project. Email Regex Guide. What is my IP Address? Website Screenshot. Time, Date, and Timezones. Company Enrichment. Get started for free. Binance API.
Use CoinMarketCap's free crypto API to get the best, most accurate real-time, historical cryptocurrency and exchange trade data for Bitcoin, Ethereum and. The CoinMarketCap API is a suite of high-performance RESTful JSON endpoints that. Use CoinMarketCap's free crypto API to get the best, most accurate real-time.