As the title implies, the purpose of this article will be to sift through why the addition of futures contracts based on the coin, Tron, being added to BitMex could spell out bad news for Tron bulls in the foreseeable future.
If you are unaware, Tron futures were added to BitMex recently at the end of June.
You can view information on this Futures launch here:
Based on the price action that occurred once $ADA (Cardano) was added to Mex, and the numerous similarities between Cardano and Tron in terms of communities, leadership and market capitalizations, I felt that it seemed logical to draw a parallel between the two coins.
How Did Cardano Fare on the Futures Market?
In short, it didn’t fare well.
Now, if you’re not up to speed on this and you’re wondering, “Hey, when was Cardano added to the futures market?”
Never fear. CryptoMed is here to help remind you.
Check Out This Link:
This is one of the many press releases that were given out that day when Cardano was added to Mex as a futures contract.
Since then, the price movement for Cardano has been abysmal to say the least.
Now, I know that the common rebuttal is going to be:
Crypto is in a Bear Market; You Can’t Attribute Cardano’s Fall to Mex At All!
This is a fair statement to make.
However, I do not believe that it is a true one.
There are also some unstated premises in this statement that must be addressed.
Thus, in order for the statement, “Crypto is in a Bear Market; You Can’t Attribute Cardano’s Fall to Mex At All!” to be true, the following must also be true:
- Cardano would have fared the exact same if they have never been added to BitMex.
- BitMex listings have zero impact on the spot price of the corresponding crypto on a given exchange. And if they do, then for some reason it had no impact on Cardano.
- Cardano’s price movement should be somewhat in lockstop with the rest of crypto during the same period of time.
In this article I am going to attempt to show why none of the implicit assumptions in this statement are true.
Let’s Review Some Facts
#1 — We Know That Cardano Was Added to Mex Futures on January 8th, 2018.
This has already been established above.
#2 — The price of Cardano at the time was 91 cents USD (approx.)
#3 — The Market Cap for Crypto was $752B on that same day
#4 — From That Point, the Market Dipped for the next couple of days, then recovered sharply by January 13th, 2018
This is indicated on the charts if you review them.
#5 — On January 13th, 2018, the crypto market capitalization was $751 billion
So essentially the crypto market capitalization had hit baseline once again.
#6 — Cardano’s price had risen back to 93 cents after slipping briefly
This is actually interesting to note because the price of Cardano was even higher on that day than it was when the futures started trading. This is something that opponents of my theory failed to note, but as an honest debater, I decided to give them that information to wield if they feel that it is still needed to make a counter-argument at the end of this piece.
#7 — The price of Cardano fell steeply downhill from that point all the way to March 31st.
Now, the purposes of me illuminating this was to create a baseline by which we can measure the rest of the cryptosphere.
According to the opponents of my theory, this decline in price is due almost entirely to the bear market that is ongoing as I write this article.
So, in order to test this theory — I went to check some other coins as well as the crypto market capitalization itself in order to create a ‘benchmark’ of sorts.
#8 — The Crypto Market Capitalization Had Decreased by 65% During the SAME time frame (1/08/2018–3/31/2018)
Market Cap on March 31st = $266b; Market Cap on Jan 8th = $753B Calculation: 1-(266/753)=64.7% (approx. 65%)
#9 — Almost Every Other T100 Coin Came Nowhere Near Shedding That Much Value
I even provided a graph of Digibyte at the end there since it was actually at a peak around January 8th, 2018 (Cardano was coming off of its peak).
Even then, $DGB still came nowhere close to $ADA in terms of the losses that were shed.
Every Premise Has Been Destroyed
The premise that $ADA’s precipitous drop in price coincided with the decline in the markets and that this is the sole reason for the price drop must be declared bullshit.
For one reason or another, $ADA got rocked way harder than ANY other cypto in the top 10 market cap and damn near every crypto in the T100.
Short of a conspiracy theory, we can only assume that there must have been some sort of outside influence on the price/fundamental changes or material information that investors had on Cardano that led to this acceleration in price decline that we’ve seen over the past few months.
What Will Await Tron?
In my estimate, the same fate awaits Tron. I think that it is a VERY easy short on a lot of levels and investors along with whales alike have been looking for the opportunity to do so.
Let’s check out the price action of Tron since it has been released on Mex.
Tron is somehow down 13.30% since futures arrived despite the fact that the entire market has appreciated during that same time period.
Today, the market capitalization sits at $273 billion.
That represents a total gain of +15.6% for the entire crypto market.
When taking this into consideration in light of the fact that Tron has depreciated fairly substantially since the advent of its addition to BitMex in conjunction with the information that we know about $ADA’s launch on Mex’s platform, it really begs the question of whether Tron will still be able to succeed as a project in spite of their addition to the exchange.
Mex is looking more and more like the death penalty for projects that do not have the market cap of an Ethereum or Bitcoin.