Basic Attention Token - Issue #18
In this newsletter, we are profiling Basic Attention Token [BAT] with the Brave browser. In previous newsletters, we have profiled Bitcoin, Ethereum, Litecoin, Polkadot and many others. Access all our newsletters in our archives at madcapx.substack.com.
The Short of It
There is plenty of potential for BAT token to rise in value. Fundamentals are good, the team is good, but it lacks the momentum Defi projects are getting.
Portfolios
This portfolio section gives you an idea of what sort of return you can get when investing in crypto assets.
BTC/USD FUND is up 408% since October 1st, 2020. Since this is a long-term holding, it is best kept in cold wallet storage or a safe custody solution. We continue to see a long-term hold position as our best stable alternative. This past week bitcoin has been ranging between $47,000 and $58,850 USD in value. BTC hit once again an all-time high.
FUND 3 started on November 16, 2020, with $1000 USD in value and invested into BTC, LTC, ETH, and ADA. The total amount of BTC value from the four coins has a gain of 36% since the start. This gain to us is an indication that alt season is happening. Against USD, it is up 347% since the start. We will hold these positions to see how well it does against our BTC-only portfolio. LTC is down 9% against BTC. ETH is up 20% against BTC since the start. ADA is up 198% since the start against BTC.
Today we are introducing this basket of coins and calling it BLWX Fund. They all are assets we have profiled in the last few months, and we are interested in how they will perform over the next several months. They were chosen since they have good fundamentals as crypto assets, but we think they could have some room to the upside in 2021.
Overall, Bitcoin should be your first choice as an investment in crypto. As a long-term investor, we see it as our largest portfolio investment. Madbyte does have its own token called MADX and is available within our member website.
Profiling
Basic Attention Token (BAT) was launched in May of 2017 by Brendan Eich and Brian Bondy. Brendan is the creator of the Javascript programming language and co-founder of Mozilla. With a maximum supply of 1.5 billion BAT, it is exchanged between users, advertisers, and publishers to reward attention (looking at ads) in their custom browser. Their browser is called Brave, and it an open-source clone of Chromium with a decentralized advertisement exchange platform built-in. BAT tokens reside on the Ethereum blockchain. As of October 2020, analysis shows that there are approximately 20.5 million active users of the Brave browser.
The Brave browser has adblocking and tracking prevention as a default feature and instead privately monitors the users’ web surfing habits in order to correctly display the kind of ads that the user would be interested in. All tracking information is only stored on the user’s own device and not sent out to anyone, thus ensuring browsing privacy. Advertisers must commit to spending a minimum of $2500 USD per month to run their campaign, which they pay entirely with BAT. Out of these payments, 70% are distributed to users. Content creators can include code in their websites, blogs, and online videos to allow Brave users to easily tip them with BAT. The capacity to tip users that are not yet part of the network is also possible.
The built-in wallet in Brave that receives BAT rewards is connected to your account at Uphold, where you can exchange BAT for other cryptocurrencies or convert it to fiat. BAT cannot be directly sent to this wallet and cannot be directly withdrawn. It must always first be sent to Uphold, from where it can be withdrawn. This is done to satisfy anti-money-laundering (AML) laws and know-your-customer (KYC) assurances. It was put in place in anticipation of potential regulations from the SEC. Their roadmap does include future alternatives to using Uphold and bidirectional wallet support.
Is this the new paradigm for online advertising and browsing data privacy? If you like what you see and expect continued mass adoption of the Brave browser, this may be the crypto for you.
Trend Lines
This first BAT/BTC weekly candlestick chart starts late 2017 when Bitcoin hit $20,000 and alt season was in full swing. BAT enjoyed some good upward swings all the way till April 2019. When we look at BAT from the start, we can clearly see how it has been on a downward trend since early 2018. The one spike in April of 2019 did not hold, and we can consider it as BAT’s bubble.
Today we are about at the same level as the lows experienced in December 2017. Could it be that BAT will stay at these lower levels all the way till November 2021 before surging upwards? Maybe not; the assumption can be that BAT will experience an upsurge before that since they have such a large base of Brave browser users. If we look at the trend, there could be roughly 329 days of accumulation before moving into a proper bull spike. It could be at least a 200% upswing.
This second chart of BAT/BTC on a 4-hour chart shows it in an upward trend. Though it seems it could break lower very soon. If BAT falls from here, it most likely will go back into the sideways trend it was on that started later in January.
BAT, as a trade, has become somewhat boring since it just can’t seem to find a proper bull trend. But there are good trades that can be had. For example, just a week ago, it experienced a breakout of the sideways trend for a total gain of 76%.
As we advance, if BAT continues to grow its base of 22 million active users and builds on changing the advertising space, BAT should go from a boring token to something that gets on the bull train.
This third chart has BAT paired against USD. Many, if not most, will use USD, we assume, as their base for trading charts, but this newsletter most of the time will use BTC as a base. Many in the Defi space use ETH as a base, but there are other country-based stablecoins that are used a lot.
In this chart, BAT lows are $0.10, and the typical high is $0.45, with an average of around $0.27. The current price is $0.56. The spike from the beginning of 2021 to early February had a gain of 332%, which is a fantastic gain. Though if we make a comparison to other crypto assets in the same time frame, we will find even crazier gains. For example, here are just a few coins we have profiled: ADA/USD 628%, UNI/USD 832%, BNB/USD 863%, DOGE/USD 1453%, AVAX/USD 2257%, BTC/USD only gained 100%. These are from the beginning of 2021 to the highs in February.
This next BAT/BTC chart from a Tradingview user has lots to unpack. So here is the chart makers own analysis:
Put simply, BAT has had an amazing accumulation phase and continues to have it. From the pits of despair at the lowest BAT-to-Bitcoin ratios we have ever seen, can BAT really climb out and reach higher than most of us would ever expect it to, given its past performance? BAT remains at a very, very low price. Even though it's at such a pitiful price today, many would argue it has good fundamentals. It has millions of users, it has a working product, and it has developers working on it who update us on multiple platforms, be it their site or their Twitter. Given that product seems to work, it doesn't seem like a rug pull... So what gives?
I trust charts first and foremost. News is here today and gone tomorrow. So what do the charts tell us? When I see this chart, I think... "Isn't this a story we've already seen?" An undervalued token with strong fundamentals, simply standing on the sidelines at dirt cheap prices. So what's the best that could happen?
As many BAT holders have said, BAT is a long-term hold. You probably aren't going to 2x tomorrow. Or next week. Or hell, maybe not even next month. Jeez, isn't it alt-season?! Despite all this, the goal that holders seem to have is to 9x and further a year, possibly two, from now. This is not suitable for quick, fast gains today. But rather, it is...
The accumulation phase of a lifetime.
So, for how long are you willing to accumulate? This all comes down to your style of investing. Do you need gains today and tomorrow? Or are you willing to invest in something low-risk that make take a while to pull in results? Because BAT really seems like it can in the long run, and at low risk of downside. When Brave and its token BAT were first released, BAT had a massive bull run of over 500%, but it did not quite have all the fundamentals in place back then. Brave was released to the public in 2018. Still, shortly after and even before its release, it faced controversy regarding its "replacement ads" and not giving creators the BAT donated to them by other users, when those rewards should definitely have been seen by the creators who were receiving donations. Since then, these issues have been fixed, so this does mean that progress has been made.
Considering some of the things the Brave team is working on, the project only seems to be more and more promising as various definite, feasible plans are in place already. Think THEMISv2, self-serve user ads, etc...
That's all great and all, but that begs the question... if you go all-in on BAT, could you be stuck holding a bag as you watch LINK, ADA, BTC, ETH, DOT, UNI, BNB, and the like, moon in the meantime? The horrific thought of you missing out on gains sends shivers down the spines of the most diamond-handed individuals. But look at how quickly BAT tends to move to the upside after a bear market... and we're in an uptrend. Is now the time to get exposure to BAT if we don't have it already? It is alt-season, is it not?
I am personally bullish on BAT, but I like to be level-headed when recommending investments to others. I'm not a financial adviser, but hopefully, I gave you all some food for thought. Happy gains-hunting. I find the prospect of hopping on the train of a pre-moon LINK or ADA exhilarating. That's what I see BAT as. But of course, when BAT's upward momentum is just barely beginning to form, it's not exactly easy to tell the whole world that this is definitely a fantastic buy, is it?
An 18 minute listen of one of the founders of BAT and the brave browser. The video was posted in February 2021.
Bitcoin’s short history has shown that it goes through 4-year cycles. Of the 4 years, one of them is a bear cycle where the losses have been big; the 3 other years have always brought BTC to new highs. We are now hit an all-time high of $58,000 per bitcoin. Is there still room for upside in 2021, or have we hit it.
In this video, Moritz Seibert and Anatoly Crachilov discuss trading and bitcoin. At time market 45:18. Anatoly says that 2021 is a pivotal year as bitcoin went institutional. Covid caused massive unemployment, which triggered central banks to flood the markets with money. 26% of all money in existence has been created in the last 12 months. In turn, this has caused a demand for hard assets. Bitcoin met the hard asset requirements.
2021 would be considered the growth phase of this 4-year cycle and add to it the money printing, and we see why big money is entering into Bitcoin. Anatoly goes onto say that he sees it still a time to buy Bitcoin.
They see that by August 2021, Bitcoin should be at $100,000 or even $120,000.
About
MadCapX research newsletter is written by the Madbyte Team. You can learn more about Madbyte and MadCapX on our websites. This weekly newsletter is a paid subscription and supports the team and the Madbyte projects. The regular cost is $5/month or $50/year. Cancel anytime.
As a paid subscriber, you can request to get access to our Madbyte Discord investor channel. In the channel, we post updates and charts related to the profiled crypto-asset. If you are already a member of our Madbyte Discord server, the investor channel is private for Madcap Tier 12 and above members and this newsletter readers. Discord invite: https://discord.gg/Pfmks83
Disclaimer: Nothing in this newsletter is intended to serve as financial advice. Therefore, do your own research and due diligence before applying any of the techniques highlighted in this post. Any risks or trades based on this newsletter are committed at your own risk.
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