Although much harder to track and incredibly risky, alt coins - that is, a cryptocurrency outside of BTC ETH and LTC - posses possibly inhuman gains via short term pump and dumps or long term holds to boost a portfolio. Today, I want to talk about VeChain, the blockchain based quality control platform traded cryptocurrency.
- What is VEN?
VEN, or VeChain, is a blockchain based platform that seeks to utilise the unique, untampered digital ledger in order to prove a products contingent parts, thus providing consumers to recognise quality and authenticity of products. Not only does this help with new products, but could also revolutionise the refurbishment and second-hand markets - especially in the digital world. Imagine buying a second-hand computer on eBay or Amazon and being able to - at the click of a button - check all original parts as well as parts of the computer that have been replaced, and with what and from whom the replacements have been sourced.
- Originality
One criticism rightly levied at many cryptocurrencies has been the lack of inherent value, USP or actual business model but, in my view, this is where VEN differs from the market. The VeChain identity technology (VID) allows supply chain parts to seamlessly integrate with the current business world via NFC, QR or RFID tags. For example, following on from the eBay computer, a company would put a VID on a hard drive which would be recognised via its VID throughout the entire manufacturing process. If this hard drive is changed, the VID will know and the consumers and original company (thinking about insurance/warranties here) would be able to see if the hard drive is still being used.
- Partnerships
A sign of a good business is other businesses wanting to act with them, the same is true of cryptocurrencies. The VeChain Foundation, which is responsible for the construction of the network, technology research and developments, has various big name partners. From PwC to Microsoft and Renault, it is clear that there are many in the financial world that, like me, believe in VEN and are interested in what they aim to achieve.
- When to buy in
Below is a 4h chart for the price actions of VEN since February. As can be seen, with an RSI of around 29 it looks as if VEN is currently undervalued and it would seem as if it is a good buy in point, especially considering the longer term view would suggest VEN being oversold. However, with RSI having been below 30 consistently over the past fews days, there is possibility of it remaining below 30 for a while longer. Furthermore, with diverging bollinger bands (see previous post for bollinger band analysis) it could be reasonably deduce that the period of high volatility is over. But, it is worth keeping an eye out for when you start to see significant rises in RSI possibly coupled with a bollinger squeeze
In conclusion, I really am passionate about VEN and do believe it is one of the few altcoins that offer significant long-term potential rather than a short term portfolio boost. Although due to the long-term nature of any positions taken on VEN, it is still worth waiting for a better entry level than current. Keep an eye on VeChain.