By Nathaniel Whittemore & Clay Collins

Introduction

The crypto space is a peculiar mixture of idealists and opportunists; of true believers and rampant speculators; of HODLers and traders. What these groups have in common is the business of belief. Those low time preference folks who care about building the financial infrastructure for a new age need the speculators to provide capital to help networks grow. The speculators need the narratives, the memes, and the long-term vision of the other group to make their bets pay off. 

For all their differences, these groups share a common infrastructure in the exchanges. Cryptocurrency exchanges were the first and remain the most important businesses built around crypto protocols. Their job is to make the business model of belief work. Yet they are more than just utility platforms for acquiring, selling, and gambling with crypto. Exchanges represent some of the most iconic brands in the crypto space and are led by some of the best known and most debated figures in the industry. 

What it means to be a crypto exchange has changed wildly since the early days of bitcoin. In many ways, the history of crypto exchanges tells the story of the evolution of the industry as a whole. Exchanges are businesses, and opportunistic ones at that. As we watch them shift, change, and evolve, what we’re really watching is a rapid response to the changing demands of crypto markets. 

That evolution is head spinning. In the early days, exchanges were simply trying to provide the most basic infrastructure necessary for buying and selling bitcoin. Today, exchanges are locked in a rapidly evolving battle for global supremacy, competing to stand out by offering ever-greater leveraged trading (or, on the other hand, greater compliance). 

Which exchanges lead the global pack and why can be revealing. Take, for example, the shift from the long-tail ICO-era dominance of Binance to leveraged trading on BitMEX during the 2018 bear market. It wasn’t random chance that caused the shift from “When moon?” to a platform where one of the CEO’s favorite sayings is “Good traders swing both ways.” It was exchanges adapting to the needs of a different time. 

We’ve organized this history of exchanges into a set of phases. Each of these phases tells the story of what it took to compete as an exchange at that time and what cycle the larger market was in. 

We start not at Binance or Gox or even the very first exchanges like BitcoinMarket.com but back before bitcoin was even invented. 

[Read more…] about A History Of Crypto Exchanges: A Look At Our Industry’s Most Powerful Institutions

This post was last updated on September 16th, 2019 at 02:59 pm

“In God we trust; all others bring data.”

― W. Edwards Deming

“If you have a quality dataset… I’ll consider it. But when it comes to opinions, I’m going with my own.”

― Andy Grove (apocryphal)

In its short life, the cryptocurrency industry has moved from margins to mania; from something irrelevant to all but those trading illicit goods on the dark web to the hottest investment opportunity in recent history.

Today, we’re again in a phase shift in crypto, only this time, it is from diagnosis – understanding how mania seized the industry – to a new opportunity for mainstream transparency.

[Read more…] about Transparency Must Be Trustless: The Nomics Manifesto

This post was last updated on August 23rd, 2019 at 04:06 pm

Note: The purpose of this article is to explain the reasoning and backstory behind our cryptocurrency exchange ratings. If you’d rather just jump to the ratings themselves, you can go to our exchange index page.

[Read more…] about Nomics’ Exchange Transparency Ratings (And The Correlation Between Transparency & Fake Volume, and Toxic Activity)

This post was last updated on June 27th, 2019 at 12:58 pm

Note: This guest post (which is over 10K words in length) is from the brilliant Katya Kovalenko at P2P Capital. Next week we’ll be posting an interview with her on the Flippening Podcast, with an audiobook version of this article coming the following week. Enjoy this deep dive.

–Clay

Intro

This post is a private investor’s take on the smart contract space and possible ways to evaluate and invest in smart contract platforms. By no means, should this be considered as the ultimate framework or as guidance of any kind. The discussed approach and analysis are purely subjective and are not intended as investment or financial advice.

The views expressed in this post are my own and might differ from those of other partners at P2P Capital, though our general vision about the smart contract space is in alignment.

Another important disclosure is that while I mention many projects in this post, not all of them are part of our firm’s or my personal investment portfolio, and I cannot endorse or verify claims of their future performance. My analysis is based on the public information, provided by these projects, and other analytical resources available in the public space.

You can check the list of P2P Capital portfolio projects here. I personally hold Bitcoin.

[Read more…] about Investing in Smart Contract Platforms