Many people know that large players on the crypto market conduct their operations on the OTC (OTC) platforms, but why there? The main reasons are the problem of reliability and processing of data provided by exchanges, as well as the inability to automatically process data from different sites. What does CoinIndex offer in the light of these problems?
CoinIndex claims to be “the most comprehensive cryptocurrency index platform in the world,” which means aggregation and access to the most diverse cryptographic data in a single format.
The site offers us 160 indices from eight dedicated families, including:
- market and stock indexes;
- indices of tokens by industry;
- indexes for platforms and ICOs;
- hash and consensus indices.
According to the data provided by the company, the CoinIndex indices are formed by the data stream received from the 102 crypto-counter by processing the 15'000 trading pairs and 2'300 instruments. How the site works, we consider below, another question has matured:
Who needs indexes?
As the famous saying goes: "Each coin has two sides" and the cryptosphere, obeying this rule, has its own problems. Since, in general, the cryptosphere is decentralized by its nature, which its participants are reasonably proud of, the series of problems associated with structuring, formatting, sequencing, in one word - the normalization of data produced by thousands of companies.
Indices, in the meaning of an instrument that presents scattered data in a uniform form, is a necessary solution for creating the functioning of "second level" systems involved in automated analysis, trading, creating more complex trading instruments based on quotes (for example, options, futures, CFDs) and for many other tasks.
What solutions are there on the market and how does the CoinIndex service differ from the competitors - we will consider below, and now let us turn to the question of who exactly are the consumers.
In addition to the fact that indices are the basis for building derivatives (VC, hedge funds, brokers, banks), they are also actively used both in theoretical (private analysts, researchers, auditors) and in practical (independent trading, asset management) activities .
It is in this area that CoinIndex works, providing fundamental information about the dynamics of the entire cryptocurrency market and its individual segments, which is in demand on the market, primarily by institutional companies, and secondly, individuals who work in the field of data analysis trade based on specific strategies (arbitration, hedging, etc.) and / or large volumes.
So there is ...
Probably every trader working in a crypto-exchange will now object that there is an API through which those who are interested can actually connect their trading robot or “feed” any developed module for analyzing the market, but do not forget that we are saying about the market as a whole and differentiated data flows.
The problem is that about 30% of exchanges, which today are already more than 300, do not provide connections via the API at all, and those that often have a complicated connection mechanism do not always transmit reliable data, for example, by trading volume ( without going into the reasoning - everyone heard about the volume boiling with bots), and when consolidating data from several sources, there is a problem of the uniformity of the specification of the tools, and you should not forget about the high cost of purchasing an API from several sources at once.
Advanced or working in the above areas, people will notice that there are already services that provide similar “sublimated” data and even offer access to them through the API, calling CoinMarketCap, CryptoCompare, CoinGecko or similar services, and they will be absolutely right. However, the data of such services are not always reliable, and the frequent problem of these well-known companies is the lack of transparency (the index construction methodology is unknown, there is no possibility to check the data in a mediated environment).
The most advanced companies will remember companies already known in “classic finance”. However, Bloomberg offers only BTC ETH, XRP, which broadcasts from Bitstamp, and Reuters displays BTC, BCH quotes from BraveNewCoin. Companies such as TRDATA and ICE that broadcast the most famous cryptocurrency courses (BTC, BCH, ETH, XRP, DASH, LTC) and take data from many exchanges, in fact, work for corporate clients on Wall Street, and this, rather closed community. Last but not least, BarChart, which broadcasts 250 tools with 40 cryptographic, asks for a substantial amount of subscription to receive its data.
What, amid the lack / incompleteness / high cost of competitive solutions does CoinIndex offer?
The company offers two solutions, the first is access to its own platform, where data ordered in an index format is aggregated, and the second is direct access to the received CoinIndex data. This approach (the provision of primary data) itself speaks about the reliability of the data, especially when combined with disclosure of the index calculation methodology, but CoinIndex goes further and plans to create a blockchain that will fix all the calculated figures.
How does the playground work?
To obtain data from CoinIndex, you can use either the JSON API (hereinafter the list of API is planned to be significantly expanded), and the index platform, which currently collects data from intermediate price aggregators.
The web terminal, which is now working in alpha version, looks like this:
Results
We can conclude that CoinIndex has a really ambitious goal - to become a kind of S&P from the crypto world. The tool created by the company is not only in demand on the crypto market and serves to promote it by creating a favorable environment for entering the sphere of institutional funds, but also useful in that it introduces transparency into the data, allowing it to be analyzed and used more effectively at the corporate level. , and privately.