This is crypto

Young as it may be, it is already well known amongst crypto enthusiasts that VeChain was the best performer since the start of the last bull rally, late 2017. Since December 1st 2017 the price increased from $0.25 to an all time high of $9.50 at the end of January - just days before the big market crash. Good for a 38x price increase in barely 8 weeks time, with VeChain's market cap increasing from $65 million to about $3.5 billion.

To put this order of magnitude in perspective, last year's initial explosion of Ethereum ($7 to $400 or 57x in 5 months) and Ripple ($0.00525 to $0.4 or 76x in 77 days) were some of the most memorable runs in the history of crypto - both of which helped set blockchain on the map of mainstream media. Hate them or love them, there is one very apparent thing that sets apart ETH and XRP from all other contenders: corporate support.

The EEA (Ethereum Alliance Enterprise), a collective that is seeking to use blockchain technology to run smart contracts at Fortune 500 companies, was a gigantic driver for the ETH price increase throughout Q2 2017 - with names such as ING, JP Morgan Chase, Microsoft, Toyota, Rabobank continuously showing interest in the network. 

Similarly, names such as Standard Chartered, National Australia Bank, Bank of America, Royal Bank of Canada and several others showing interest in the Ripple protocol for cross-border payments are ultimately the reason why Ripple is as big as it is today. The fact that it's centralized and that the in-house XRP tokens are not even required to facilitate any of these payments do not even seem to matter for speculative market value.

Whether or not these players will continue to dominate, or even exist 5-10 years from now, remains to be seen. What we do know is that on a shorter timeframe the crypto market is driven largely by hype and anticipation. Big names cause big price rallies. The more, the better. This is crypto. Momentum is everything. If there is one project out there that continues to outperform all others on this, it's VeChain.

VeChain: Past, Present and Future

At the time of writing, VeChain is valued at $4.75 with a $2.2 billion market cap after having seen a large and well-deserved price correction. At the bottom of the big February crash it went down as deep as $2.65, but recovered fairly quickly - possibly thanks to the long awaited and well-timed rebranding event in Singapore on February 26th. Since then, it's seen its fair share of "sell the news" followed by being on the lower end of the Bitcoin bull run, sinking many alts a little deeper into their holes.

While many weak hands are currently leaving VeChain with the basic assumption that "the run is over" and anticipating to buy back around the time of the main net release around June 2018, they are basically betting on the fact that VeChain will not continue to deliver good news between now and then. People selling into the dip essentially believe that Bitcoin (or other alts) will outperform VeChain during the next 3-4 months. I beg to differ.

• 12/05: VeChain rebranding and MasterNodes
• 12/14: DNV GL Partnership
• 12/18: China National Level partnership (Gui'An Smart City)
• 12/21: Jiangsu Printed Electronics Partnership
• 12/23: Xiamen Innov Information Technology Partnership
• 12/27: BitOcean's Japanese ATM's Partnership
• 01/02: Healthcare Co. Ltd. Partnership
• 01/04: Hubei Sanxin Cultural Media Ltd. Partnership
• 01/14: China National Tobacco Partnership
• 01/18: Fanghuwang Partnership
• 01/21: Breyer Capital Support announcement
• 01/26: Sentinel Chain cross-chain IoT announcement
• 01/31: VeResearch announcement
• 01/31: Michigan State University VeResearch participant
• 01/31: iTaotaoke Partnership
• 02/07: VeVID first infrastructural dApp announcement
• 02/11: 188 Business Alliance Association Partnership
• 02/12: VeChain meets Belgian parliament
• 02/19: Yida Group Partnership
• 02/26: Oxford University VeResearch participant
• 02/26: BitOcean VeChain ICO announcement
• 02/26: BMW Group Partnership

This overwhelming amount of news releases (including 13 partnerships) is what set apart VeChain during the last few months. Each and every one of these announcements attract further capital investments.

"DNV GL has established business connections with more than 80,000 valued customers, including Airbus, Coca Cola, Tencent, IBM, Oracle, Cisco, HSBC, and Alibaba."

With partners such as DNV GL (world leading certificate authority and business certification service provider), PwC (audit and assurance, tax and consulting services multinational) and Kuehne Nagel (one of the world's leading logistics companies), VeChain has clearly positioned itself for what may possibly be the biggest crypto attraction for the year to come in terms of increased corporate support. Besides the obvious short-term speculation value, it's also becoming clear that VeChain will very likely be one of the few blockchain projects that will still be around after the capitulation phase - focusing on solving real-world use cases today.

Aside from this, there are also still numerous rumors going around of increased exchange support as well as potential further collaboration with the Chinese government and the People's Bank of China, streamlining the long awaited crypto regulations. If the latter turns out to be true, the result will be mass hysteria. It's only a matter of time before China makes their big announcement, presumably opening the crypto gates again. When that time comes - you do not want to be standing on the sidelines.

Bitcoin still steers the market

Whatever you think your portfolio may do this year, Bitcoin will continue to dominate the entire game. Bitcoin goes hard, alts suffer. Bitcoin pauses, alts rally. Bitcoin crashes, alts crash harder. Having said that, we're in luck, there is lots of room for growth in Bitcoin. With the block reward halving in 2020 (supply goes down) in combination with increased interest from investment firms and hedge fund managers as well as improved infrastructure and regulation (demand goes up), Bitcoin potentially has a long way to go. It may sound counterintuitive, but modern portfolio theory shows that by allocating a tiny percentage into an extremely volatile asset that is uncorrelated to the rest of the portfolio, you actually decrease the overall risk of your total investment. It is estimated that around 95% of volume in traditional markets is controlled by professional parties, versus about a measly 10% in crypto markets. You do the math. At the very least, it's an indication that general adoption is still very much in a upwards curve. The only reason you would argue the opposite is if you assume that digital assets will not be part of our future generations, in which case you probably would not be holding any crypto at this point anyway.

To get to my point, if you are holding crypto at this point, it means you are expecting Bitcoin to go up. The general expectations for 2018 seem to lie anywhere between a fairly conservative $40,000 and an optimistic $100,000. From this point (BTC ~$11500) that's roughly x4-10.

Market cycles aside, which one do you expect is easier to achieve given all variables above?
BTC $40,000 (~$676 billion)
VET $20 (~$9 billion)

If the answer is VET, then you are losing value by holding BTC. Ergo, you should be buying VET. As a small sidenote, $7-10 billion is more or less what projects such as NEO, Cardano and Stellar are recently valued at.

If we look back to the beginning of the article and correlate speculation value to the amount of corporate support a project sees, we're talking about a potential $40B (Ripple) to $85B (Ethereum) by the end of the year - depending on what kind of names VeChain reels in. This would put VET at $90 to $190 respectively.

These numbers may seem outrageous, but remember: this is crypto. Exactly one year ago, ETH was worth $19 with a $1.8 billion market cap. As Bitcoin starts rallying again, new investors will come into the market. Buyers are coming.

Ask yourself this: how long have you been holding each and every one of your assets, and what good have they shown you last year? Cross-reference the developments and achievements those projects have shown, and what it meant for the price. It may be a good indication for what to expect in 2018.

VeChain Technical Analysis

Weekly Chart

On the weekly chart, there is not much to be said. A lack of price history doesn't allow for any indicator to be of help. We can see however that the breakout of the downward trend which occurred 3 weeks ago is still intact, and is currently making some sort of a retest of that same trend line. If that line continues to support until the end of this week (03/11/2018), it would be a bullish sign.

Daily Chart

On the daily, we see that the price corrected all the way to somewhere halfway the 50% and 61.8% fibonacci retracement level based on the entire VeChain run of the past few months. This is a very healthy correction and may indicate a strong bottom, one which also correlates to a past consolidation period and support levels between 0.00048000 and 0.00036000btc. Worst case scenario, if Bitcoin decides to go on another bull rally, a possible further correction may follow down to 0.00032500btc which corresponds to the 61.8% fibonacci support, as well as the support trend line mentioned earlier. The ichimoku tenkan-sen and kijun-sen (the blue and pink line which function more or less as moving averages) crossover still remains bullish, but are close to cross bearish. The bias here is not entirely clear.

Were this bottom to confirm a few days/weeks from now, VeChain's new potential targets based on fibonacci extension levels lie somewhere between 0.0011700, 0.0016700 and 0.0024500btc. For reference purposes, if Bitcoin were at $25,000 at that time - we would be talking about $30, $40 and $60 by the end of the next entire VeChain rally. Let that sink in for a minute.

4hr Chart

Here we can start forming short term ideas. A few days ago VeChain experienced (just like many other alts) a major selloff, driving the asset into extremely oversold levels on the RSI indicator. The bullish divergence (shown by the yellow lines) gave us an early sign of an upcoming trend reversal, which by now also formed some type of small double bottom. The flat kijun-sen (pink line) and the flat top forming on the red ichimoku cloud function as magnets. All you need to know is that essentially the price always wants to pull back to flat tops, because they indicate levels where the market had been agreeing on that price for a long time. Based on this information, expect VeChain to trade back around 0.00050000btc in a not too distant future. In order for VEN to turn back bullish, we will have to wait for a new bullish cloud breakout - which (without news) could take another few weeks to complete.

Good luck and happy trading!
-ExpectedValue