CoinTracker raises $1.5M to make tracking cryptocurrency investments easy(techcrunch.com)
techcrunch.com
CoinTracker raises $1.5M to make tracking cryptocurrency investments easy
https://techcrunch.com/2018/04/10/cointracker-raises-1-5m/
93 comments
Investments? When you buy a crypto currency, what are you investing in?
Thank you for saying so. As far as I'm concerned, it's speculation, not investment. Investment has some sort of underlying productive asset which one gets a part of and that then hopefully pays returns. Speculation is betting money on price movements.
As long as we're trying to rehabilitate financial terms, cryptocurrencies don't have "market caps". Stocks do, because they represent companies which could plausibly be purchased in one go for something near that number. But currencies and commodities don't have market caps, because buying up an entire currency a) doesn't make any sense (the value of a currency is in its continued circulation), and b) would wildly distort the price if even a fraction of the total were purchased.
As long as we're trying to rehabilitate financial terms, cryptocurrencies don't have "market caps". Stocks do, because they represent companies which could plausibly be purchased in one go for something near that number. But currencies and commodities don't have market caps, because buying up an entire currency a) doesn't make any sense (the value of a currency is in its continued circulation), and b) would wildly distort the price if even a fraction of the total were purchased.
In case of some of the any currency - the volume that flows through it.
If Ethereum is a go-to place to do equity crowdfunding in the future, and we estimate the volume of such operations at $120B a year, then - assuming it takes a month from the moment someone buys ETH to invest in an ETO, to the moment a startup sells it for a fiat money, Ethereum's market cap will need to be at least $10B to fulfil that need, and that would be a cap bottom then.
On top of that, there will be other uses, and of course speculation/hype factor, which you can count in as well.
Now, with the advent of stable coins, it's possible that most of the ETOs won't be funded using Eth, but a dollar derivative (e.g. MakerDAO), or a token represented by a locked-up asset (e.g. Digix). Right now MakerDAO uses Eth as a backing, so it doesn't change the math, but if the Digix model proves successful, it affect this calculations.
Another line of reasoning for Eth is that you have transaction fees, and here again you can easily calculate the money velocity, and a potential volume flowing through the system.
Finally, when PoS arrives, Eth will yield de facto dividends - that's planned to happen within a year, although it has been postponed a few times already.
For other cryptocurrencies - MakerDAO, Digix, or Ocean have economies that can be calculated in a similar way. A plenty of other ones to.
Now, if you say that there is a low chance of such projects being successful - keep in mind that all these projects aim high. If there is 1% probability that BananaCoin will really help people grow bananas, it will deserve a $100M valuation, since it will be worth $10B in case of success.
Oh oh, in case of some projects, if not most, their book to equity rate is very high by Wall Street's standards. Golem may seem overpriced with their $200M valuation (that is - you believe they either have <1% of success, or their target market cap is <$10B), until you realise they have around $100M-$150M in assets after their ICO. That's a lot of money they can spend to deliver the value.
If Ethereum is a go-to place to do equity crowdfunding in the future, and we estimate the volume of such operations at $120B a year, then - assuming it takes a month from the moment someone buys ETH to invest in an ETO, to the moment a startup sells it for a fiat money, Ethereum's market cap will need to be at least $10B to fulfil that need, and that would be a cap bottom then.
On top of that, there will be other uses, and of course speculation/hype factor, which you can count in as well.
Now, with the advent of stable coins, it's possible that most of the ETOs won't be funded using Eth, but a dollar derivative (e.g. MakerDAO), or a token represented by a locked-up asset (e.g. Digix). Right now MakerDAO uses Eth as a backing, so it doesn't change the math, but if the Digix model proves successful, it affect this calculations.
Another line of reasoning for Eth is that you have transaction fees, and here again you can easily calculate the money velocity, and a potential volume flowing through the system.
Finally, when PoS arrives, Eth will yield de facto dividends - that's planned to happen within a year, although it has been postponed a few times already.
For other cryptocurrencies - MakerDAO, Digix, or Ocean have economies that can be calculated in a similar way. A plenty of other ones to.
Now, if you say that there is a low chance of such projects being successful - keep in mind that all these projects aim high. If there is 1% probability that BananaCoin will really help people grow bananas, it will deserve a $100M valuation, since it will be worth $10B in case of success.
Oh oh, in case of some projects, if not most, their book to equity rate is very high by Wall Street's standards. Golem may seem overpriced with their $200M valuation (that is - you believe they either have <1% of success, or their target market cap is <$10B), until you realise they have around $100M-$150M in assets after their ICO. That's a lot of money they can spend to deliver the value.
isn't most investing speculative though?
Not really, except in a sense that's pretty close to wordplay.
Investing is about looking at the fundamental value of something, its economic productivity. Speculation is betting on fluctuation. If I put my retirement money in an index fund, I am indeed thinking about the future in a way that could be called speculative. But in the financial world, speculation has a specific meaning that is distinct from investing:
https://en.wikipedia.org/wiki/Speculation
Investing is about looking at the fundamental value of something, its economic productivity. Speculation is betting on fluctuation. If I put my retirement money in an index fund, I am indeed thinking about the future in a way that could be called speculative. But in the financial world, speculation has a specific meaning that is distinct from investing:
https://en.wikipedia.org/wiki/Speculation
All financial instruments are speculative. The fundamental value is only ever part of the question, because fundamental value divorced from resale value would likely never pay itself off for most investments in most people's lifetimes. Even Warren Buffet speculates on price, because he takes a bet on fundamental value relative to market value.
You think cryptocurrencies are not investments because they aren't economic producers. Cryptocurrency is not an economic producer, because currency is not an economic producer. It is an economic enabler though, and currencies have intrinsic values related to their various properties that affect how they enable economies: backed by gold, backed by government trust, backed by cryptography, identity and trust in the controller of money supply, anonymity vs transparent identity, transaction speed, liquidity, legal legitimacy, etc.
The best historic analogy for the investment profile of the cryptocurrency craze right now is war bonds. With war bonds, you are investing in the success of the nation issuing them. Failure of that nation means default. Success means that bond is convertible to national currency that has a liquid marketable value. Right now the utility of those cryptocurrencies is low: transaction volumes are low, liquidity is low, acceptance is low. But by speculating on cryptocurrencies, you are betting on their future utility, with the caveat that most will likely fail and be completely worthless in the long run. Yes, it's speculative...just like every other investment out there.
You think cryptocurrencies are not investments because they aren't economic producers. Cryptocurrency is not an economic producer, because currency is not an economic producer. It is an economic enabler though, and currencies have intrinsic values related to their various properties that affect how they enable economies: backed by gold, backed by government trust, backed by cryptography, identity and trust in the controller of money supply, anonymity vs transparent identity, transaction speed, liquidity, legal legitimacy, etc.
The best historic analogy for the investment profile of the cryptocurrency craze right now is war bonds. With war bonds, you are investing in the success of the nation issuing them. Failure of that nation means default. Success means that bond is convertible to national currency that has a liquid marketable value. Right now the utility of those cryptocurrencies is low: transaction volumes are low, liquidity is low, acceptance is low. But by speculating on cryptocurrencies, you are betting on their future utility, with the caveat that most will likely fail and be completely worthless in the long run. Yes, it's speculative...just like every other investment out there.
Yes, that's the sense that's close to wordplay.
Betting on any currency is speculation, not investment. And although currencies may be useful, that doesn't mean that buying more currency than you need for practical purposes is going to turn you a profit.
Indeed, the opposite often applies. A good currency has low volatilty and is easily exchanged for other things. The US dollar has been a great currency for decades, but buying lots of dollars wouldn't have made you rich, because dollars are not productive assets. They just sit there. No serious investor parks lots of money for long periods in currencies; it's better to buy productive assets (e.g., stock index shares) in that currency.
If Bitcoin ever becomes a good currency, it too will be a bad choice for speculation. A financial company with Bitcoin infrastructure might be a good investment. But Bitcoin's high volatility, which makes it great for speculation, will have to vanish if it ever becomes a decent currency.
Betting on any currency is speculation, not investment. And although currencies may be useful, that doesn't mean that buying more currency than you need for practical purposes is going to turn you a profit.
Indeed, the opposite often applies. A good currency has low volatilty and is easily exchanged for other things. The US dollar has been a great currency for decades, but buying lots of dollars wouldn't have made you rich, because dollars are not productive assets. They just sit there. No serious investor parks lots of money for long periods in currencies; it's better to buy productive assets (e.g., stock index shares) in that currency.
If Bitcoin ever becomes a good currency, it too will be a bad choice for speculation. A financial company with Bitcoin infrastructure might be a good investment. But Bitcoin's high volatility, which makes it great for speculation, will have to vanish if it ever becomes a decent currency.
Normally there's some sort of external factor that you're indirectly speculating on -- the success (or failure) of the company issuing a stock, for instance. With most cryptocurrencies, though, there's no economic fundamental underlying the price; speculation is the primary (and, in many cases, only) thing controlling the price.
The fact that cryptocurrency markets aren't regulated -- and, in fact, are frequently manipulated by schemes that would be illegal in any other marketplace -- doesn't help, either...
The fact that cryptocurrency markets aren't regulated -- and, in fact, are frequently manipulated by schemes that would be illegal in any other marketplace -- doesn't help, either...
In case of the top ~100 cryptos/tokens, there is usually an external factor.
Besides that, the distinction between speculation and investment is not as clear as you say.
By your definition, there is no such thing as "investing in art" - only "art speculation".
The definition of investment/speculation I prefer is whether the asset purchase is based on economic reasoning, or emotional reasoning. The latter is people buying "because the charts are growing", or "because the market is hot but will be hotter", or using technical analysis voodoo.
If you have a basis for your purchase price that is not connected to historic price charts, you're an investor.
Besides that, the distinction between speculation and investment is not as clear as you say.
By your definition, there is no such thing as "investing in art" - only "art speculation".
The definition of investment/speculation I prefer is whether the asset purchase is based on economic reasoning, or emotional reasoning. The latter is people buying "because the charts are growing", or "because the market is hot but will be hotter", or using technical analysis voodoo.
If you have a basis for your purchase price that is not connected to historic price charts, you're an investor.
You can't just make up new meanings for words. Speculation is a defined thing in the financial world: https://en.wikipedia.org/wiki/Speculation
Investing in art happens all the time. Movie companies do it reliably when they create or purchase films with the hope of generating both economic value (that is, enjoyment) and long-term profit. Music companies do it when they give a band money to make a new album. Touring art shows could also be seen as an investment where they acquire assets and then generate value (that is, viewership) with them. But yes, buying and storing paintings in hopes they will be worth more later is speculation.
Investing in art happens all the time. Movie companies do it reliably when they create or purchase films with the hope of generating both economic value (that is, enjoyment) and long-term profit. Music companies do it when they give a band money to make a new album. Touring art shows could also be seen as an investment where they acquire assets and then generate value (that is, viewership) with them. But yes, buying and storing paintings in hopes they will be worth more later is speculation.
Interesting question. I'd assume that it's not and that the Warren Buffets, pension funds and value investors outnumber significantly the day traders (which are trying to profit off the former) and speculators.
It's the same as with other investments. You're putting some money in, with the hope that the thing you buy will appreciate in the future.
When you buy stocks what exactly do you buy? Some stake in a company? Nonsense. You're just hoping that company will do well and your stock will appreciate.
Sure you can invest in commodities like oil or gold. Does that mean that an oil tank will be delivered to you door? No. You're just creating a virtual position with that commodity, hoping to close it later at a better price.
Same with crypto currencies.
When you buy stocks what exactly do you buy? Some stake in a company? Nonsense. You're just hoping that company will do well and your stock will appreciate.
Sure you can invest in commodities like oil or gold. Does that mean that an oil tank will be delivered to you door? No. You're just creating a virtual position with that commodity, hoping to close it later at a better price.
Same with crypto currencies.
If I believe that shares of stocks generally come with votes, which allow you to control the company if you have enough of them...and I believe that oil or gold futures do indeed entitle you to take physical delivery, does that mean I should not invest in cryptocurrencies, because I inhabit a different reality than those who do?
A lot of cryptos have the same thing, with "votes"
Hot air, quite literally in the case of mining pool server farm energy waste.
the ability of a consensus protocol & its associated distributed system(s) to preserve an accurate history in the face of a multi-million (or billion) dollar bug bounty and/or state-level attack. You get a price that discounts the risk of failure on that front and the failure to win mindshare / real use.
There are many strong arguments as to why that's a bad bet, but that's the bet IMO.
There are many strong arguments as to why that's a bad bet, but that's the bet IMO.
Just like any currency - the goods that can be traded for it. Not useful as a currency in places with solid currencies like the US or EU, but some countries have poorly functioning currencies where cryptocurrencies provide some benefit. Also, it has value as a transfer currency, like when your own country limits how much money you can take out of the country.
In places where you can move money easily, and the local currency is stable and generally usable, then it's basically a trading commodity like gold or oil.
In places where you can move money easily, and the local currency is stable and generally usable, then it's basically a trading commodity like gold or oil.
For platforms, I invest to get a discount on apps I intend to release. SONM falls into this category and is one of my largest holdings.
Delusional dreams of vast riches seems to be the common theme.
While you're being downvoted, I wouldn't necessarily disagree.
On the stock market (which we consider a more legitimate investment), share price is entirely driven by perception and the amount of buyers vs sellers. This resembles cryptocurrencies as well.
The difference, however, is that there is an underlying company you're betting on with a stock, and buyers often believe that a company will have more buyers in the future due to the company's performance and its actual returns.
Cryptocurrencies are a much more volatile, short-term investment with virtually no regulations, and there's very rarely an underlying bet aside from "this sounds good and will sound good to other people too."
On the stock market (which we consider a more legitimate investment), share price is entirely driven by perception and the amount of buyers vs sellers. This resembles cryptocurrencies as well.
The difference, however, is that there is an underlying company you're betting on with a stock, and buyers often believe that a company will have more buyers in the future due to the company's performance and its actual returns.
Cryptocurrencies are a much more volatile, short-term investment with virtually no regulations, and there's very rarely an underlying bet aside from "this sounds good and will sound good to other people too."
There maybe little in the way of special regulations for cryptocurrencies but certainly fraud is still illegal, no matter the specific industry or asset.
I think when people say there are 'no regulations' it communicates an idea that theft, fraud and/or violating contracts are not prosecutable. Maybe that's my own flawed interpretation but I believe that's how it comes across to the average person.
I think when people say there are 'no regulations' it communicates an idea that theft, fraud and/or violating contracts are not prosecutable. Maybe that's my own flawed interpretation but I believe that's how it comes across to the average person.
Value store, which will come in handy after US defaults on its debts.
Value store is not an investment. And a US default is extremely unlikely.
In your opinion, what is the probability of that happening?
In my opinion, it will happen around 2040 with almost certainty, but probably in the form of hyperinflation out of debt, rather than actual default.
In the extraordinarily unlikely chance of that happening you're going to want guns, ammunition, and a food supply, not digital Beanie Babies.
The number one automatic tax calculation is CryptoInsight (https://www.trackr.im/), they're coming up with a new version that automatically synchronize your exchange/s accounts and trading, according to your country of origin (for tax purposes).
Have taken a quick look at it, still seems in very early stage. Keep up the good work! Is the platform releasing soon?
BTW whats the purpose of having your own token? What is it used for?
BTW whats the purpose of having your own token? What is it used for?
FYI - they are using TKR token for their project - https://coinmarketcap.com/currencies/trackr/
love cointracker! super useful while doing my taxes, couldn't have done it without them.
I prefer CoinTracker over Bitcoin.Tax, but I hope they add the ability to import en masse for next year. I use a decentralized exchange (BitShares), and I had to switch from CoinTracker to Bitcoin.Tax because of a few thousand trades I had to track. If I was just trading on Coinbase/Gdax/Bittrex, then I would have stuck with CoinTracker for sure.
We launched zenledger.io
There's going to be many players in this space across geographies and more.
Godspeed to them all.
There's going to be many players in this space across geographies and more.
Godspeed to them all.
More choice is good.
I wrote my own cryptocurrency portfolio management tool https://tulips.flurdy.io to replace a complicated a spreadsheet I used before.
Still needs plenty of polish and still beta, but Tulips works for me.
I wrote my own cryptocurrency portfolio management tool https://tulips.flurdy.io to replace a complicated a spreadsheet I used before.
Still needs plenty of polish and still beta, but Tulips works for me.
Tulips lol
I see what you did there
I see what you did there
Cointracker is my goto for automatically tracking trades across multiple exchanges and wallets. I don't even use it for Taxes yet. It's really worth checking out. I expect big things from these guys.
I tried it before and found https://cointracking.info/ much more useful in nearly all comparisons. Better tax info and preperation, better syncing, more supported sync targets, faster updates, more tracked coins, and better stats pages. And this is all on the free version of coointracking. If you pay the yearly fee, the auto syncing and auto-wallet sync is a huge standout.
(co-founder of CoinTracker here). CoinTracking is indeed a great tool. That said we have also made a lot of progress over the last several weeks and now support unlimited free tracking with auto-syncing (no yearly fee!). We'd love for you to take another look at https://www.cointracker.io and see how we can improve further.
You still don't support Bitcoin Cash local wallets, and you still don't support any kind of local wallet that is more than a single address. Come on guys, it's been months, this is basic stuff.
Working on it and would like to add this soon!
Your service is much expensive than them
Mistake, thought guy replying was talking about Cointracking.info which does have a bad UI
I find this comment surprisingly hostile, which is especially surprising given that the subject of UI design is so subjective.
I find the design of Cointracker to be quite good, personally. It seems clean, simple, and easy to understand.
(I have no connection to Cointracker other than as a user.)
I find the design of Cointracker to be quite good, personally. It seems clean, simple, and easy to understand.
(I have no connection to Cointracker other than as a user.)
@mecha9 I think you're confusing CoinTracker.io for CoinTracking.info. Former got funding. Latter I haven't used.
Yes I am, sorry
https://news.ycombinator.com/newsguidelines.html
> Be civil. Don't say things you wouldn't say face-to-face. Don't be snarky. Comments should get more civil and substantive, not less, as a topic gets more divisive.
> Be civil. Don't say things you wouldn't say face-to-face. Don't be snarky. Comments should get more civil and substantive, not less, as a topic gets more divisive.
Can we please get xpub import? I use a trezor and importing each wallet address is a pain.
Thanks for a great service. I used it for my taxes this year.
Thanks for a great service. I used it for my taxes this year.
Coming soon!
Does CoinTracker support ethereum (smart contract) multi-sig wallets?
Could you share an example to [email protected]?
I used CoinTracker this year to help me figure out how to report cryptocurrency on my taxes, and felt like it was a total ripoff. $50 for a two line csv file? Give me a break.
They have a product that integrates with many exchanges and makes it easy to produce those 2 lines of csv. I tracked it myself and it took me a few hours. Just logged into CoinTracker and it took me about 10 minutes to do the same amount of work. It is worth $50 to me!
That said, it isn't perfect. I marked several transactions as transfers but it didn't change my cap gains numbers. I added it up manually and the numbers don't seem to add up. Then I checked back later and looks like those numbers are updated later. But why? And by how much time?
That said, it isn't perfect. I marked several transactions as transfers but it didn't change my cap gains numbers. I added it up manually and the numbers don't seem to add up. Then I checked back later and looks like those numbers are updated later. But why? And by how much time?
Sorry that wasn't super clear to begin with — we have added a banner when cost basis is still updating now so that you can see when the updates are done.
[deleted]
I checked this out but fell at the first hurdle. CoinTracker connects to your Coinbase account and auto-imports. CoinTracking requires you to go through an export/import cycle whenever you make more trades. Yikes.
Does cointracking generate 8949 statements when you have >100k transactions?
EDIT: Wrote this on my phone where I confused Cointracker with Cointracking
I had something like 50k+ transactions last year. Cointracking wouldn’t create a 8949 for me because their servers couldn’t handle a dataset that large, but they could create a capital gains CSV file that was super easy for my acccountant to sum up a few columns and make the 8949. That said, their very high transaction count plans are $1000+, which seems insane. Through a bug they had interfacing with HitBtc I was able to get the CSV for free, but next year I doubt I’ll use this service at that high price.
I had something like 50k+ transactions last year. Cointracking wouldn’t create a 8949 for me because their servers couldn’t handle a dataset that large, but they could create a capital gains CSV file that was super easy for my acccountant to sum up a few columns and make the 8949. That said, their very high transaction count plans are $1000+, which seems insane. Through a bug they had interfacing with HitBtc I was able to get the CSV for free, but next year I doubt I’ll use this service at that high price.
The one year plan is $120. Not sure where you're seeing 1000+
Whoops, I conflated Cointracker.io (https://www.cointracker.io/tax/plans) with Cointracking.info. Sorry!
I am too interested in this. It'd be a massive stack of 8949s.
8949 only allows for 14 transactions. You need to generate 8949 statement
https://www.irs.gov/instructions/i8949#idm140253115164448 see Exception 2
My statement had 390 pages.
https://www.irs.gov/instructions/i8949#idm140253115164448 see Exception 2
My statement had 390 pages.
Great product and great team. Congrats Cointracker
Are people still doing this crypto stuff? I'm an "early adopter" of Bitcoin. Made a 1000% return on my initial "investment". I got into it because we need decentralised electronic cash. The investment part is ridiculous, though.
Can the title be updated to say 'cryptocurrency' rather than 'crypto'?
http://cryptoisnotcryptocurrency.com
http://cryptoisnotcryptocurrency.com
Agreed. As pointless as railing against language change is, it bothers me a bit that 'crypto' has come to be synonymous with a very small (yet very loud) area of the application of Cryptography. But this too shall pass.
I think you mean that we'll come to accept it, correct?
Much like we accept that most people say 'USB' when they mean memory stick, or when someone says the word 'microwave' we assume they are talking about the metal oven that cooks their food.
Much like we accept that most people say 'USB' when they mean memory stick, or when someone says the word 'microwave' we assume they are talking about the metal oven that cooks their food.
If cryptography was exciting to the non-IT crowd it would still hold the belt, but...
Which type of cryptography investments do you think readers will confuse this with?
The other day someone invested $50MM into a non-profit to further the development of Signal/WhatsApp, two phone apps that provide end-to-end encryption for billions of people around the world.
That's a crypto investment that has nothing to do with blockchainiacs.
That's a crypto investment that has nothing to do with blockchainiacs.
German here, we really need some tool to keep track of our bigram tables. Last time my granddad lost one it didn't end well...
when enough people start to say crypto to mean cryptocurrency, the meaning will change.
Why do people get so pedantic over a title? Even if it is confusing at first - so what? I never understood the need to correct such minor details...
Coin trackers are all commodities.
In fact, the best tracker is the one where the price of the coins I am holding increases.
Please optimize for that one single metric, coin tracker creators :)
In fact, the best tracker is the one where the price of the coins I am holding increases.
Please optimize for that one single metric, coin tracker creators :)
These coin/porfolio trackers are a privacy nightmare. You're basically telling some stranger your detailed crypto finances, and it's unknown how your data may be used.
One of the golden rules in crypto is to never disclose your holdings to anyone on the internet, yet people are using these apps without a second thought!
One of the golden rules in crypto is to never disclose your holdings to anyone on the internet, yet people are using these apps without a second thought!
That's why in Trivial.co we all things client-side only, with the data never touching the servers - that's true for your accounts, but also for stuff like tokens that you watch, and so on.
I hope more startups picked up this way.
I hope more startups picked up this way.
Meh. It can be done pretty damn good. †[1]
† Not affiliated in any way.
[1] https://www.cryptocompare.com/portfolio-public/
† Not affiliated in any way.
[1] https://www.cryptocompare.com/portfolio-public/
Why is that a golden rule? Genuine curiosity.
I believe people say that because by announcing your digital assets you are making yourself a target and raising the opportunity benefit of compromising your computer and/or web accounts.
That's a great point. Imagine if one of these sites got hacked. A hacker could literally walk away with a list of emails, each exchange on which that person has an account, and a list of assets. Time to sort by most valuable account, and go spear phishing...
Does anybody else not worry about providing access to their investments via direct access to the various exchanges? If they are hacked, they have a direct pipeline to my accounts? Surely not all exchanges are setup to provide secure read only data? And what about the initial auth connection?
I just hate to add another point of vulnerability into an area that is no doubt being heavily targeted by hacking groups
I just hate to add another point of vulnerability into an area that is no doubt being heavily targeted by hacking groups
I wish people would refer to crypto as a service and not an investment. The goal of these alt coins is to enable services. People are doing a disservice to the industry by referring to them or using them as an investment.
ideally that would be true, but 95% of the people i know who have bought cryptocurrency have bought it for the investment.
And do you not see why this is a problem?
The market makes up its own mind
Why? It helps preserve and stabilize the value of the currencies.
True. That's the role of speculators in any market. They buy stuff that nobody wants, this way preventing the price from falling too hard. I always buy my T-shirts in the winter. They're cheaper.