Hey all! I’m Juan Villaverde, one of the analysts at Weiss Ratings.
You can check me out on this page: https://weisscryptocurrencyratings.com/our-cryptocurrency-team (third from the top).
I’m here to address your criticisms that many regarding our ratings methodology.
We understand some people are upset about the rating given to their favorite coins, and are amazed at how passionate this community is overall! Cryptocurrencies and blockchains are not only revolutionizing the financial industry as a whole, they are also changing people’s relationship to money itself, which is something that is completely unprecedented in the history of mankind!
Never in my lifetime have I seen greater enthusiasm for any investment! No matter how you slice it, that’s a good thing. And yes we understand crypto is so much more than that, it’s difficult sometimes to explain what a “cryptocurrency” is to a layman.
Which leads me to one of the biggest sources of misunderstanding about our ratings:
We do analyze them as INVESTMENTS. In fact, our primary audience is investors. And most of them are NEW investors coming into this market for the first time. They don’t have months – let alone years – of experience with the volatility and periodic price crashes. They don’t have big profits in the bag to cushion the next big decline. They get scared by 10% down days. They won’t believe us if we try to tell them “relax, it will come back”.
That’s the number one source of misundestanding between our model’s results and what most folks in this space expected: That big price volatility! That’s the main reason we have no As on our list right now. It’s also one of the key reasons some currencies seem to be under-rated while some seem over-rated. Why two currencies with very different technology or fundamentals wind up in the same general category. But they’re not in the same category.
So to provide more clarity, here’s what we’re going to do:
We will break out our assessment of EACH of the four main factors that go into our final letter grade: Risk, Reward, Technology and Fundamentals.
We will disclose our assessment for each as “excellent,” “good,” “fair,” “weak” and “very weak.”
Then we’ll leave it up to each person to decide how to use the info.
(We provide explanations of each of the four indexes in this article: https://weisscryptocurrencyratings.com/ratings/the-weiss-cryptocurrency-ratings-explained-15)
If you don't think price action is important and believe it's all about user adoption and underlying protocols, well you should only care about Fundamentals then, ignore the trading, price-action stuff.
Will this step address all of your questions? Of course not. But it will certainly add some more clarity. The ratings will start making a lot more sense to you.
I’ve got plenty more comments to respond to, particularly regarding individual coins. But I’ll save them for later, AFTER we’ve published our evaluations of each of those four factors that go into our ratings. In the meantime, check out our comments on some of specific coins here: https://weisscryptocurrencyratings.com/ratings/thank-you-for-your-feedback-130
Stand by. I’ll be back with more later. In the meantime, I welcome any and all comments, we acknowledge that we should've released a more detailed explanation of our thinking process for constructing these ratings, so I'm here to put some (hopefully all) questions to rest : )
JMV