2. Background

2.1 Cryptocurrency investing today is guesswork

A disjointed cryptocurrency market

Cryptocurrencies have been on the market for more than a decade since the creation of Bitcoin in 2009. With countless different cryptocurrencies and various blockchain platforms in the market today, however, there is little information available to support informed decisions on where and how to invest.
Independent financial analysis of a new investment asset class such as cryptocurrencies and cryptocurrency-denominated assets is one requirement for broader acceptance of cryptocurrencies and cryptocurrency-denominated assets as a legitimate investment class.
Additionally, information on the cryptocurrency market is spread out across multiple unaffiliated websites with varying degrees of quality. There is no reliable source of accurate information for crypto markets that adequately addresses the needs of professional or retail investors by aggregating critical information into one portal. SafeNFT will solve this problem.

A gap that needs to be filled

We will establish the media platform that maximizes the number of leads we attract through a website that offers free content on cryptocurrency, blockchain, and IDO-related subjects. The site will serve as a source of revenues from advertising and user-prepared content, and a source of leads for the NFT Marketplace and other advisory services.
Anyone who registers on the site and creates a profile may begin purchasing our independent research, which will be based on unbiased quantitative and qualitative analysis that can withstand the scrutiny of experienced investment professionals worldwide (similar to institutional research purchased by banks and funds). We will also offer customized research for institutional clients.
Our business model will evolve to become a decentralized autonomous organization (DAO) that identifies and validates new and promising researchers who can contribute their own monetizable research to the platform, further increasing our value.
All SNFT Token holders will also have in aggregate five percent (5%) ownership of the company.

2.2 The state of the investment research marketplace

Independent research firms are on the rise

Historically, investors received equity research directly from banks through the mail. With the rise of the internet in the mid-1990’s, email took the place of regular mail, which itself was replaced by internet-based providers.
Investment letters available through paid subscription have followed the same evolution with a clickthrough to a members-only website with proprietary analyses and reports. Institutional investors may also receive their research through professional portals, such as Bloomberg terminals, which dominate the business-to-business (B2B) research market today.
According to most recent estimates, aggregate spending on investment research in 2017 approached $16 billion with over 40,000 pieces of research content emailed each week by investment banks and brokerages.
Those figures are likely to fall with the implementation this year of the Markets in Financial Instrument Directive (MiFID II) in the European Union, which requires asset managers to pay for research directly rather than having the cost included in their trading commissions. A recent poll by Quinlan & Associates indicates that asset managers are expected to reduce budgets for sell-side research by as much as 30%with the implementation of MiFID II.
The net effect of these trends will deprive small to medium-size investors of research that they cannot afford to replicate on their own and will increase the market for independent investment research firms, which have the scale to justify the cost of preparing proprietary research for a broad base of customers.
Growth in the market for independently produced research is expected to accelerate as MiFID II is implemented through the end of 2018. With current trends, an increasing share of investment research will migrate to independent providers like CreditSights and Visible Alpha, a company launched commercially in 2017 with investors that include Morgan Stanley, Jeffries, Citi, UBS, and Bank of America.
A key element of the SafeNFT business model is to create an affordable, democratized NFT-based research platform for cryptocurrency investors. Data NFT can be bought once and resold multiple times with no worry of circulation of cloned copies.

Lack of professional investment research in the cryptocurrency market

A lack of professional investment research, limited transparency among IDOs, and the proliferation of misinformation has created the speculative valuations, high levels of volatility, and opportunities for fraud in the cryptocurrency market today.
SafeNFT seeks to provide accurate, timely information to investors on cryptocurrency markets. Reliable research is particularly important for cryptocurrency and blockchain investors, who lack professional guidance on which investments are most appropriate for their portfolios.
Current market value of cryptocurrencies is less than $1.71 trillion, with more than $700 billion attributable to Bitcoin alone. By comparison, global equity markets account for over $109.2 trillion β€”nearly 64 times greater.
Cryptocurrency valuations are generally poorly understood, easy to manipulate, often feature opaque business models, and trade at valuations based more on word-of-mouth hype than business fundamentals. Investors around the world have been hurt by market manipulation through pump-and-dumps and exit schemes long before the crypto market crashed in early 2018. They are especially vulnerable during bear market cycles in 2021 when scams, attacks, hacks, and exploits are almost non-stop.
Volatility in cryptocurrencies has reached extreme levels, making it difficult to realize the quoted market price for investors seeking to build or liquidate positions in any given token. In the chart below, the annualized 30-day rolling volatility of an equal-weighted index of the top 3 tokens by current market value (Bitcoin, Ethereum, and Ripple) dwarfs the same volatility of the S7P 500 Index by an average factor of almost 10 times.
Volatility of Cryptocurrency Daily Index Prices Versus S&P 500
(July 2016 - May 2018)
Token holders and institutional investors with a background in traditional investments have little to no information to support informed investment decisions, aside from general cryptocurrency news sites such as CoinDesk and aggregate IDO tracker sites such as IDOHunt.
At the same time, institutions are increasingly more active in cryptocurrencies and in need of research.
Professionally produced investment research provides investors with the background information, data, and guidance required to make reasoned decisions on security selection and investment timing.
SafeNFT seeks to provide the professional resources needed to support sustainable investment decisions and broader participation in cryptocurrency markets by institutional and retail investors worldwide.
Last modified 5mo ago