0x Protocol (ZRX) Cryptocurrency Investment Research Report

0x Protocol (ZRX) Cryptocurrency Investment Research Report

0x Protocol (ZRX) Cryptocurrency Investment Research Report 1500 1383 CryptoInvestResearch

Introduction 0x Protocol (ZRX)

0x is an open protocol that enables the peer-to-peer exchange of assets on the Ethereum blockchain. The 0x (ZRX) is an ECR20 token traded on the Ethereum blockchain.

Anyone in the world can use 0x to service a wide variety of markets ranging from gaming items to financial instruments to assets that could have never existed before.

0x is an important infrastructure for the emerging crypto economy and enables markets to be created that couldn’t have existed before. As more assets become tokenized, public blockchains provide the opportunity to establish a new financial stack that is more efficient, transparent, and equitable than any system in the past. 0x ZRX Protocol will act as a critical piece of infrastructure for the token economy, allowing Ethereum smart contracts to programmatically and seamlessly exchange Ethereum-based assets.

Current Story for 0x Protocol (ZRX)

0x Protocol (ZRX) is a Top 33 Coin at Coinmarketcap at the time of writing.

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In a world with thousands of Cryptocurrency Coins, decentralized exchange protocols will be game changers, because they are key pieces in the crypto infrastructure.

The 0x Token (ZRX) gives a solid opportunity to benefit from the rise of decentralized exchanges. Investing in 0x Protocol is not comparable to the investment into a centralized exchange, like Binance (BNB), Kucoin (KCS). 0x is more comparable to the investment into a portfolio of exchanges, in a focused ETF fund, where you can profit from the overall performance of the exchanges.

We can assume, that longterm some exchanges might be acquired by bigger players. E.g. Coinbase announced the purchase of Paradox in May 2018. Paradox is a decentralized exchange and runs on 0x Protocol.

Protocols have potential to develop crypto economies and help to push the ecosystem to new highs.

Investment Rating for 0x Protocol

 

ACCUMULATE / BUY

Mid term accumulation in the range of:
0.25 – 0.32 USD

Investment Valuation Scores for 0x ZRX Protocol

Project Fundamentals Score
Token Economics Score
Community / Social Attention Score

The Valuation Scores are based on the Cryptocurrency Valuation Model developed by The Coin Research Team. Please see below for more details.


Investment Strategy for 0x Protocol (ZRX)

Investment Rating: Buy / Accumulate 0x Protocol (ZRX)
Buy Up to Price / Accumulate: $0.25 – $0.32
Stop Loss: $0.18 – $0.20
Position Size: $500–1,000 if you’re a smaller investor or $1,000–2,000 if you’re a bigger investor


Cryptocurrency Exchanges: Where to buy 0x Protocol (ZRX)? 

Best Exchanges to buy 0x Protocol: 

At the time of writing, 0x is being traded in 118 cryptocurrency pairs on nearly all exchanges. The Exchanges with the biggest volume are 55 Global Markets from Korea, Binance and Coinbase.

Buy It On: Binance (RECOMMENDED), Coinbase

binance cryptocurrency exchange for bitcoin altcoin trading        Coinbase Cryptocurrency Exchange for 0x Protocol ZRX, Bitcoin, Ethereum


How to store 0x ZRX Protocol Tokens? 

0x Coins are ECR20 tokens, stored on the Ethereum blockchain. Every cryptocurrency wallet that works for Ethereum, will work for ZRX too.

We recommend to not store the coins on cryptocurrency exchanges. It’s safer to use the own wallet, where you control the keys.

Store It On:  Nano Ledger (RECOMMENDED), MyEtherWallet

ledger nano hardware wallet from the coin research store 0x protocol zrx

Price Scenarios and assumptions for 0x Protocol 

Bull Case Scenario:
Target price range 1.20 – 1.50 USD (413% – 517%)
(Assumes strong growth of decentralized exchanges, Binance builds their DEX on 0x Protocol)

Base Scenario:
Target price range 0.80 – 1.00 USD (275% – 345%)
(Assumes medium growth of decentralized exchanges, an average adoption rate that builds over time)

Risk Bear Scenario / Stop Loss Scenario:
Target price range 0.18 – 0.21 USD (-18% – 38%)
(Assumes low adoption of decentralized exchanges, competitors offer a better protocol, bear market environment for crypto)

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Time Horizon for 0x Protocol Investment

Our target prices are based on mid-term to long-term scenario estimates.

Mid-term in this definition means 6-12 month, long-term 12-18 month.
Short-term investments (less than 3-4 month) are the playground of traders, day traders, who are “always online” to monitor the live market’s developments based on Technical Analysis and Fundamentals.

Development of 0x Protocol (ZRX)

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Key research findings: 0x Protocol (ZRX)

Part 1): Company Background and Recent Updates of 0x ZRX

The 0x team is focused on the development of the protocol, the infrastructure of the ZRX token. Currently, there are over 15 (fifteen!) 0x Relayers (these are exchanges build on top of the infrastructure) which drive the adoption of 0x ZRX. All Relayers are independent teams, who increase the chance of success for a 0x Token investment and the risk of failure is well diversified.

Only a few people know for the time being about decentralized exchanges. Once the world will learn, that you can anonymously trade coins on exchanges, the shift from centralised will gradually happen.

The 0x Team is one of the best in the Crypto industry. The leaders have all an excellent background and a huge network in the ecosystem. Like for every other project: The best idea is worth nothing if there are no right people behind it to execute it effectively.

Summarized: The fact that 0x is a protocol allows other teams and companies to build upon its protocol signalizes an exceptional growth potential. Furthermore, the market is discussing the probability, that Binance might implement their first DEX (Decentralized Exchange) on the 0x Protocol.

Our conclusion: 0x Protocol is a highly undervalued cryptocurrency project, with a real working product and a very strong and highly committed team. We will see this project raising in the years to come. The success of the 0x ZRX Token depends on the adoption of decentralized exchanges for Cryptocurrency.

Part 2): Valuation of 0x ZRX Protocol

Cryptocurrencies are a new asset class. The performance of these assets is based on different fundamentals, compared to standard Stock or Bond assets. Most projects are in an early stage, comparable to startups. Financial indicators would not provide valuable insights, if available. Softer Key performance indicators are rarely available too, like the number of customers, adoption rate, etc. 

The Coin Research Team has developed a comprehensive CRYPTOCURRENCY VALUATION MODELL for Tokens and Crypto projects. We use a broad set of indicators and group them into 3 categories: 

  1. Project Fundamentals 
  2. Token Economics
  3. Community / Social attention   

The Score range is from 0 – 100 (maximum). Scores above 70 indicate very solid projects with strong indicators in the subsegments researched.

0

Project
Fundamentals Score

0

Token
Economics Score

0

Community / Social
Attention Score

The Coin Research Valuation Model for Cryptocurrencies considers the following:

  • Fundamentals Score: Research of the Idea, Use Case, Whitepaper, Blockchain, Legal risk ICO, Funding level, Competitive situation, Roadmap, Github, Team, Leadership, Governance, Investors, Advisors, Transparency, Communication, and several others.
  • Token Economics Score: Token use case, Value from the use case, Incentive to use it, Inflation, Distribution, Decentralization of Ownership, Dividend Model, Governance model, Exchanges, Liquidity, Daily Volumes, Fluctuations, and many more.
  • Community and Social Attention Score: Followers, Hashtags, Mentions, Members Social Media channels, activity, quantity and quality, Tonality, Promotions, Educational material, Support Groups, etc.

Part 3): Investment Risks for 0x ZRX and How to Mitigate Them?

The concept of a cryptocurrency is still novel and, compared to traditional investments, 0x ZRX Protocol doesn’t have much of a long-term track record or history of credibility to back it. With their increasing use, Cryptocurrency Coins are becoming less experimental every day, but remain in a development phase.

Please note: Cryptocurrencies are pretty much the highest-risk, highest-return investment that you can possibly make.

Our overall risk evaluation is LOW to MEDIUM for 0x ZRX Protocol. 

 

Risk 1: Market Volatility for 0x ZRX Protocol 

Cryptocurrencies and 0x ZRX included, are highly volatile assets. The 2% fluctuation you might know from the stock market, can easily translate to 10-15% fluctuation in Cryptocurrencies.

Indeed, the value of the 0x currency has seen wild swings in price over its short existence. Subject to high volume buying and selling on exchanges, it has a high sensitivity to “news.

The volatility of 0x Protocol ZRX fluctuates between 0.18 USD to 2.20 USD. Huge swings on a daily basis between 5-10% are rather usual than exceptional.

0x protocol zrx market volatility chart

0x Protocol ZRX Market Volatility Chart, Source Coinmarketcap

 

Risk 2: Company Inherent Risks for 0x Protocol ZRX 

Company inherent risks are:

  • Security breaches and hacks of the protocol. Note this is a “Software Only” company and the protocol is everything they produce. Entirely digital companies and all cryptocurrencies are at risk from hackers, malware, and operational glitches.
  • Important team members could leave the project. The best ideas are worth nothing if there are no high skilled people to execute.
  • Decentralized exchanges suffer lack of acceptance and the economic model behind the token, will not prosper.

0x’s ZRX price is quite dependent on the total market situation and the development of the decentralized exchanges build on top of the protocol. There is a risk, that these exchanges never hit the mainstream and will not become “game changer”. As a result, the price of 0x might not have the dynamics we expect.

 

Risk 3: Regulatory Risk for 0x ZRX Protocol

0x Protocol raised money through an ICO (Initial Coin Offering) (24m USD, August 2017). As a result, governments may conclude that 0x tokens are securities and might seek to regulate, restrict or ban the use and sale of tokens. Or the SEC might enter into a legal dispute with 0x Protocol.

 

Risk 4: Investors Risk 0x (ZRX) – Consumer Protection

Unlike traditional banks, cryptocurrency doesn’t have any official safeguards or insurances. Your wallet is not a bank! Your exchange is not a bank!

For example, whereas the Federal Deposit Insurance Corporation underwrites depositors’ savings to the value of $250,000 each in both banks and brokerages, crypto exchanges are not part of the program. If your exchange becomes insolvent, you will lose everything.

Ultimately, buying cryptocurrencies could result in losing everything you invested in them. You should never invest more than you can afford to lose.

Part 4): The Worst Case Scenario and How to Avoid it?

The worst-case scenario for 0x Protocol is that the coin falls to zero. Or nearly zero. This can happen if the protocol would be hacked, the issue is not solvable and the company would not be viable. However, the probability is extremely low for this.

Form an investors point of view, the risk is that the investment does not develop positively and the coin drops in value.

How to avoid losses with cryptocurrencies? (0x ZRX)

We recommend working with a clear Loss limit Strategy. Means, when the coin reaches a level you set, e.g. 0.18 USD for ZRX, you sell the investment.

This can be executed via Stop Loss Orders if you keep the coins in exchange. Stop Loss Orders allow you to set a price at which you want to sell a coin. Stop-loss orders are designed to limit an investor’s loss on a position in a security.

Example: if the coin reaches 0.18 USD, your Stop Loss Order will be executed and you would automatically sell at 0.18 USD.  Note that if the price of the coin never reaches your limit price, your trade won’t be executed.

Stay tuned to The Coin Research and check our updates. We will publish updates to 0x Protocol ZRX on a regular basis.

Disclosures:

The Authors do not own 0x ZRX tokens. This research report is strictly informational and is not investment advice. Please refer to our Legal Notices for further information.  The Coin Research and the author did not receive compensation to create this research report, outside of our customers and subscription paying members. We have not been hired by the covered company or other third parties (e.g. consultants, advisors, VC) to prepare this research report.

Forward-Looking Statements and Projections:

Any estimates, projections, forecasts included in this document are speculative and based upon analysis of publicly available information. The targets, recommendations, thoughts shared in the report are subject to known and unknown risks, uncertainties and other unpredictable factors. The report might not cover all risks, might be materially wrong and forecasts might not materialize. No representations or warranties are made as to the accuracy of such forward-looking statements.

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