Author Topic: BIT20 Smartcoin, top 20 cryptos weighted index (ETF like)  (Read 13182 times)

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Offline EstefanTT

BIT20 Smartcoin, top 20 cryptos weighted index (ETF like)
« on: March 21, 2016, 05:12:28 pm »

In july, with a friend, we made an index (BIT20) composed by the top 20 crypto currencies by MC. Every crypto in the basket is weighted in the same way popular indexes like the CAC40 are. This way, Bitcoin doesn't move strongly the value of the index and the last of the top 20 have an impact on the index if its value grow. We also created an other index called FIAT10 who is made in the same way to represent the top 10 FIAT. So we have been able to compare BIT20 to FIAT10 and see the globale evolution of the crypto sphere Vs the FIAT money since July 2015.

The unofficial beta web site is only made in french at the moment but you can easily take a look at the graphs and the way the 20 cryptos are weighted.

Home page with BIT20 Vs FIAT10 : http://www.bitsharesfcx.com/bit20/homepage_fr.php
Individual crypto Vs the basket BIT20 : http://www.bitsharesfcx.com/bit20/graph_fr_4.php

A recent thread ( https://bitsharestalk.org/index.php/topic,21955.0/all.html ) open our eyes on the fact that it wasn't that complicated to create a BitShares smartcoin based on what we already have working flawlessly since july 2015.

After some reflexions we are decided to continue and push the idea forwards.

The next steps we have in mind are :

# review and re-review our code and make it flawless and bullet proof
# learn how to create the smartcoin and provide the pricefeed in a decentralised way in graphene (I'm already in touch with Xeroc who kindly propose his help)
# revamp the web site in something more proffesssional (only in english for the release), I'm already looking for a nice CSS template.
# get the maximum opinions, reflexion and feedback on the project from the community so we can do it in a smart way
# Officially launch the web site, create the smartcoin and commercialise it.

After this minimum viable release of the web site and smartcoin, we are considering to make the website available in several lenguages and add it other kind of crypto economical informations and graphs.

Anyone wanting to join the team is very welcome, PM me.

Number of users in here beleive that a well done index representing the global evolution of the crypto currencies could grow quickly. There is probbaly lots of investors looking for something like that so they don't have to read 50 forum everyday to know where to invest. I completely agree with them and think that could also bring value to BitShares itself. Let's imagine for a second that this index would grow to be a very liquid, deep market, well-known basket or index in which you can invest in the global evolution of crypto currencies ... BitShares would sky rocket !

The project is moving forward right now and will be done probably sooner rather than later.

The quality of the smartcoin and the website will depend in big part of the feedback and brainstorming we will have in this thread.
There is a lot to discuss. Things like the best options and permissions of the smartcoin, with what we'll back it or what could we have in the website besides what we already have in the beta version (Poloniex troll box, BitShares tweeter feed news, ... ?)
Even the name BIT20 has to be change because numbers are not allow for the smartcoins ... any ideas ?

As this could bring value not only to the smartcoin itself but also to BitShares, I hope we can all join our mind to come with a great index all together.

 



Bit20, the cryptocurrency index fund http://www.bittwenty.com
(BitShares French ConneXion - www.bitsharesfcx.com)

Offline tonyk

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Re: BIT20 Smartcoin, top 20 cryptos weighted index (ETF like)
« Reply #1 on: March 21, 2016, 05:56:52 pm »
First + 1 + 1 + 1  for going ahead with this.


 I definitely think you should use bitBTC as collateral. This also means btc should not be part of the index. [Using bitUSD is the only thing better but you will just not find people (in crypto space) believing that all/top crypto will go down against fiat, so no shorters..]

Why bitBTC :
- it is easy to bet on BTC as it is- you just hold btc. And 99.9% of the people already hold btc before even coming into BTS.
- you will have much more people interested in betting on top 20 cryptos against BTC (as opposed to against BTS)
- for the shorters - being short the index against BTS as easy as pie - you short bitBTC to yourself and use the bitBTC to short the bitTop20

I am absolutely positive going with BTS as collateral will be a big mistake. Drop me PM if you do not understand/want me to expand on the reasoning above.
« Last Edit: March 21, 2016, 05:59:21 pm by tonyk »
Lack of arbitrage is the problem, isn't it. And this 'should' solves it.

Offline EstefanTT

Re: BIT20 Smartcoin, top 20 cryptos weighted index (ETF like)
« Reply #2 on: March 21, 2016, 06:16:18 pm »
First + 1 + 1 + 1  for going ahead with this.


 I definitely think you should use bitBTC as collateral. This also means btc should not be part of the index. [Using bitUSD is the only thing better but you will just not find people (in crypto space) believing that all/top crypto will go down against fiat, so no shorters..]

Why bitBTC :
- it is easy to bet on BTC as it is- you just hold btc. And 99.9% of the people already hold btc before even coming into BTS.
- you will have much more people interested in betting on top 20 cryptos against BTC (as opposed to against BTS)
- for the shorters - being short the index against BTS as easy as pie - you short bitBTC to yourself and use the bitBTC to short the bitTop20

I am absolutely positive going with BTS as collateral will be a big mistake. Drop me PM if you do not understand/want me to expand on the reasoning above.

I would prefer to create the debate in this thread than move it in a private channel.

Don't you think that we lack of liquidity in the BitShares BTC market to really kick off the Bit20 ?  Maybe if we had already the sidechain in place ... I don't want to wait we reach high liquidity in all our major smartcoins market to see grow the BIT20 but rather be able to start creating liquidity since the very first day.

I thought BTS was a good choice but the debate is pretty much alive !!

BTS has higher volatility than BTC, so more oportunities to make a profit will arise for buyers, sellers and shorters as the price spikes up and down.
That's also basically why I though BitUSD wouldn't be a great choice, I don't see anyone in his right mind shorting BIT20 Vs BitUSD.
Bit20, the cryptocurrency index fund http://www.bittwenty.com
(BitShares French ConneXion - www.bitsharesfcx.com)

Offline tonyk

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Re: BIT20 Smartcoin, top 20 cryptos weighted index (ETF like)
« Reply #3 on: March 21, 2016, 06:19:36 pm »
forgot to mention - for those interested in all top 20 crypto including BTC - you just calculate and post on the website what percent of BTC they should keep . say the calculation says 15% in btc, so they use (1- 15%)  = 85% of their BTC to buy the index and keep 15% in BTC.
Lack of arbitrage is the problem, isn't it. And this 'should' solves it.

Offline tonyk

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Re: BIT20 Smartcoin, top 20 cryptos weighted index (ETF like)
« Reply #4 on: March 21, 2016, 06:24:06 pm »
First + 1 + 1 + 1  for going ahead with this.


 I definitely think you should use bitBTC as collateral. This also means btc should not be part of the index. [Using bitUSD is the only thing better but you will just not find people (in crypto space) believing that all/top crypto will go down against fiat, so no shorters..]

Why bitBTC :
- it is easy to bet on BTC as it is- you just hold btc. And 99.9% of the people already hold btc before even coming into BTS.
- you will have much more people interested in betting on top 20 cryptos against BTC (as opposed to against BTS)
- for the shorters - being short the index against BTS as easy as pie - you short bitBTC to yourself and use the bitBTC to short the bitTop20

I am absolutely positive going with BTS as collateral will be a big mistake. Drop me PM if you do not understand/want me to expand on the reasoning above.

I would prefer to create the debate in this thread than move it in a private channel.

Don't you think that we lack of liquidity in the BitShares BTC market to really kick off the Bit20 ? Maybe if we had already the sidechain in place ... I don't want to wait we reach high liquidity in all our major smartcoins market to see grow the BIT20 but rather be able to start creating liquidity since the very first day.

I thought BTS was a good choice but the debate is pretty much alive !!

BTS has higher volatility than BTC, so more oportunities to make a profit will arise for buyers, sellers and shorters as the price spikes up and down.
That's also basically why I though BitUSD wouldn't be a great choice, I don't see anyone in his right mind shorting BIT20 Vs BitUSD.


I think this:
- for the shorters - being short the index against BTS as easy as pie - you short bitBTC to yourself and use the bitBTC to short the bitTop20
So in other words -  in reality the lack of liquidity in bitBTC does not matter much. You do that to open a short position in bittop20 without needing any bitBTC on the market. Same goes to closing it - you free your bitBTC from the collateral and close your short bitBTC with them.
« Last Edit: March 21, 2016, 06:25:47 pm by tonyk »
Lack of arbitrage is the problem, isn't it. And this 'should' solves it.

Offline yvv

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Re: BIT20 Smartcoin, top 20 cryptos weighted index (ETF like)
« Reply #5 on: March 21, 2016, 06:49:37 pm »
This is great! Bit20 and fiat10 is a dream of investor. Make BTS as collateral.

Edit: Don't worry about web site, translations and other farts and whistles for now. Just make your tokens and let us trade.
 
« Last Edit: March 21, 2016, 06:52:07 pm by yvv »

Offline hcf27

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Re: BIT20 Smartcoin, top 20 cryptos weighted index (ETF like)
« Reply #6 on: March 21, 2016, 07:25:18 pm »
First + 1 + 1 + 1  for going ahead with this.


 I definitely think you should use bitBTC as collateral. This also means btc should not be part of the index. [Using bitUSD is the only thing better but you will just not find people (in crypto space) believing that all/top crypto will go down against fiat, so no shorters..]

Why bitBTC :
- it is easy to bet on BTC as it is- you just hold btc. And 99.9% of the people already hold btc before even coming into BTS.
- you will have much more people interested in betting on top 20 cryptos against BTC (as opposed to against BTS)
- for the shorters - being short the index against BTS as easy as pie - you short bitBTC to yourself and use the bitBTC to short the bitTop20

I am absolutely positive going with BTS as collateral will be a big mistake. Drop me PM if you do not understand/want me to expand on the reasoning above.

I would prefer to create the debate in this thread than move it in a private channel.

Don't you think that we lack of liquidity in the BitShares BTC market to really kick off the Bit20 ?  Maybe if we had already the sidechain in place ... I don't want to wait we reach high liquidity in all our major smartcoins market to see grow the BIT20 but rather be able to start creating liquidity since the very first day.

I thought BTS was a good choice but the debate is pretty much alive !!

BTS has higher volatility than BTC, so more oportunities to make a profit will arise for buyers, sellers and shorters as the price spikes up and down.
That's also basically why I though BitUSD wouldn't be a great choice, I don't see anyone in his right mind shorting BIT20 Vs BitUSD.

Hello,

I am glad this project is going forward, count with me for anything you need, as I have said in several occasions I think this is a great idea.

I think collateral should be BTS, its just way simpler, most people dont even understand what BitBTC is... its like BTC but then its not... so if we used BitBTC we would be like shorting twice, you short bts to get bitBTC and then you short BitBTC to get Bit20, its just makes things really complicated for newbies IMO.

I love the name bit20 and the logo you have made, since we cant have number I would say  bitTWENTY so we can keep the logo with the numbers.

I agree that we should create the token and then start doing some marketing to get liquidity, I am sure people would love it.


 

Offline EstefanTT

Re: BIT20 Smartcoin, top 20 cryptos weighted index (ETF like)
« Reply #7 on: March 21, 2016, 09:34:13 pm »
Well, we still have to understand the process of providing the price feed in graphene and test it so it will work properly.
I'll have time to work on a basic but serious web site at the same time we complete the smartcoin techy part.

Off course, when we are ready to create the smartcoin, even if the web site is not ready, we will do it without waiting ! The web site can come later.

BITTWENTY o BITWENTY could be a good name. We are still thinking about it. Any idea is welcome !
Bit20, the cryptocurrency index fund http://www.bittwenty.com
(BitShares French ConneXion - www.bitsharesfcx.com)

Offline hcf27

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Re: BIT20 Smartcoin, top 20 cryptos weighted index (ETF like)
« Reply #8 on: March 21, 2016, 09:37:17 pm »
Oh yeah, something else:

I also think a ETF Share token should be issued so that contributors get some sort of reward, [member=32961]EstefanTT[/member] mentioned an idea like this on a previous thread and I thought it was quite incentive and a perfect way to do some crowdfunding too.


Offline EstefanTT

Re: BIT20 Smartcoin, top 20 cryptos weighted index (ETF like)
« Reply #9 on: March 21, 2016, 09:48:26 pm »
Oh yeah, something else:

I also think a ETF Share token should be issued so that contributors get some sort of reward, [member=32961]EstefanTT[/member] mentioned an idea like this on a previous thread and I thought it was quite incentive and a perfect way to do some crowdfunding too.
I mentioned it in the other thread. I have been thinking about creating a UIA that would represent 100% of the benefits coming from the 0.1% cut taking on the trades of the index.
That would allow us to reward easily anyone helping in the project.
I will probably create the UIA when I create the smartcoin and a buyback or dividend system would be use.
Bit20, the cryptocurrency index fund http://www.bittwenty.com
(BitShares French ConneXion - www.bitsharesfcx.com)

Offline hcf27

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Re: BIT20 Smartcoin, top 20 cryptos weighted index (ETF like)
« Reply #10 on: March 21, 2016, 09:50:59 pm »
Oh yeah, something else:

I also think a ETF Share token should be issued so that contributors get some sort of reward, [member=32961]EstefanTT[/member] mentioned an idea like this on a previous thread and I thought it was quite incentive and a perfect way to do some crowdfunding too.
I mentioned it in the other thread. I have been thinking about creating a UIA that would represent 100% of the benefits coming from the 0.1% cut taking on the trades of the index.
That would allow us to reward easily anyone helping in the project.
I will probably create the UIA when I create the smartcoin and a buyback or dividend system would be use.
+5%

Offline puppies

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Re: BIT20 Smartcoin, top 20 cryptos weighted index (ETF like)
« Reply #11 on: March 21, 2016, 10:26:33 pm »
Great initiative.  Let me know if there is any way I can assist. 
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Offline liondani

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Re: BIT20 Smartcoin, top 20 cryptos weighted index (ETF like)
« Reply #12 on: March 21, 2016, 10:32:22 pm »
 +5% +5% +5%  for the initiative !!!


some thoughts...

I think if you want to stick to the "best" 20 crypto's you should use the first 20 with the biggest volume NOT the 20 with the  biggest marketcap.... because we will see many shitcoins on the list very often....
if bit20 is depended from marketcap only it will be very misleading...  And not only use the 24h volume of course... we can use the top 20 crypto with the biggest weekly or monthly volume....

if you want to stick only with the marketacap then I prefer a bit10 index instead of the bit20 so that crap coins get out-filtered... 

Offline EstefanTT

Re: BIT20 Smartcoin, top 20 cryptos weighted index (ETF like)
« Reply #13 on: March 21, 2016, 10:40:20 pm »
Great initiative.  Let me know if there is any way I can assist.
I will ! This thread is also a way to know people interested in the project ;)
Bit20, the cryptocurrency index fund http://www.bittwenty.com
(BitShares French ConneXion - www.bitsharesfcx.com)

Offline yvv

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Re: BIT20 Smartcoin, top 20 cryptos weighted index (ETF like)
« Reply #14 on: March 21, 2016, 10:46:44 pm »
+5% +5% +5%  for the initiative !!!


some thoughts...

I think if you want to stick to the "best" 20 crypto's you should use the first 20 with the biggest volume NOT the 20 with the  biggest marketcap.... because we will see many shitcoins on the list very often....
if bit20 is depended from marketcap only it will be very misleading...  And not only use the 24h volume of course... we can use the top 20 crypto with the biggest weekly or monthly volume....

if you want to stick only with the marketacap then I prefer a bit10 index instead of the bit20 so that crap coins get out-filtered...

I support this point. Market cap is a bad measure of performance. Issue trillions of shit coins and get #1 market cap. Look at ripple for example. Trade volume is the only good way to evaluate crypto token performance.