People usually rate cryptocurrencies by their prices, but have you ever wondered how analysts create their grades? Today we’ll talk a bit about what goes into those high-grade investment reports. The Weiss crypto rating agency recently published its entire methodology, and it turns out they have some pretty strong opinions about it.
Back to Weiss Ratings. It all starts with collecting thousands of data points and passing them through a complex set of yes or no questions. Each coin is graded in the same standardized way, allowing to compare any kind of asset with each other.
The analysis is based on factors like decentralization, technology and adoption levels, and they try to stick to hard numbers as much as possible. They also consider the risk posed to investors.
For example, Bitcoin was originally graded C+, just because of the volatility of the market. Without this factor, it gets an A for its very strong adoption.
For example, the latest report, EOS, XRP, and Ethereum sit together with Bitcoin in the top 4, when they’re graded for technology and adoption. These four coins all have fairly big communities, giving them grades of A or A-minus.
But those grades change if we consider risk. Most grades are lower, and BNB suddenly rises to the top and takes Ethereum’s place due to its lower risk rating.
In all of this Weiss still remains positive about the market, which has grown in use tremendously over the last 12 months.
As you may know we at Cryptobriefing also have our own analytic reports and rating system. You can find an explanation under each and every report, which we give for free on our website.
These reports are just as rigorous, and they focus on everything ranging from the addressable market to the team and technology potential. Each of the 7 factors is then summed to come up for the final grade, which is updated regularly as new developments come to light.
Now I’d like to hear from you. How do you analyze the crypto market? After you subscribed, head over to the comment section, give me a shoutout and let me know.
Remember that a s the 4th point of the IDDA technique, you must calculate your risk tolerance before deciding on the investment strategy that is suitable for your portfolio. Don’t forget to complete your risk management due-diligence before developing your investment strategy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of NASDAQ, Inc.