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Welcome to the 32nd Coin Report. In today’s report, I will be assessing the fundamental and technical strengths and weaknesses of ExchangeCoin. This will be comprised of an analysis of a number of significant metrics, an evaluation of the project’s community and development and an overview of its price-history. The report will conclude with a grading out of 10. I hope you enjoy the read!
Introduction
Until Wiktor from the team contacted me to book in this Coin Report, I had not heard of ExchangeCoin, and, frankly, its somewhat uninspiring name was likely one of the reasons the project had not hit my radar. Despite this, I was intrigued to begin deep research, particularly after my preliminary research found that this was by far the smallest project that has ever been the focus of one of these reports, thus there are likely many points of interest for the speculator; and many distinctions and comparisons to be drawn between an uncommonly small microcap and the larger, more established projects that often feature on this blog.
I will not beat around the bush; there were a number of weaknesses and flaws that, if I’m honest, I anticipated given the size of the project, but there were also a great many positives to be drawn. I’m sure you will draw your own conclusions by the end of this report.
I hope this report will prove objective where it must be and fair on more subjective matters. For those who’d like to learn a little more about ExchangeCoin prior to reading this report, here are some primary links:
Fundamental
General:
Name: ExchangeCoin
Ticker: EXCC
Algorithm: Equihash
Sector: Decentralised Exchange
Exchanges: CoinExchange, TopBTC & XULT
Launch Overview
ExchangeCoin was launched in November 2017 with an ICO that raised 650 BTC, equating to over $5,000,000 at the time. The token issued, EXCC, has a maximum supply of 32,003,133, with 4mn EXCC sold during the ICO. Further, the project also has a premine of 12.1mn EXCC, equating to 37.95% of the maximum supply (from which the 4mn was sold to the public in the token sale).
The token itself operates on the Equihash algorithm, and underwent a hard fork in July 2018, after which the network migrated to a dual Proof-of-Work/Proof-of-Stake consensus mechanism, with 30% of block rewards rewarded to stakers and 70% to miners. The block reward is progressively diminishing, with the current reward at 24.5 EXCC per block, with 2.5-minute block times.
Price-History Overview
Despite ExchangeCoin being in existence for almost two years, the lack of exchange listings and thus liquidity or volume has rendered technical analysis virtually inconsequential; that said, I will cover what I can in the Technical section.
For now, it will suffice to say that ExchangeCoin printed an all-time high of ~1800 satoshis in December 2018, according to CoinPaprika, and has since continued to bleed, currently trading at 36 satoshis, though above its all-time low of 8 satoshis.
Project Overview
Unlike many projects, ExchangeCoin is very precise in its aims, as one would expect given the name of the project: in short, it concerns itself exclusively with exchanges in the cryptosphere, seeking to bridge the gap between centralized and decentralized exchanges, in particular.
As stated in their whitepaper:
I am keen to take a look at the progress that has been made since these claims were made.
Let’s begin with some Metric Analysis:
Metric Analysis:
Below are listed a number of important metrics, all of which are accurate as of 20th August 2019. For anyone reading this who has yet to read a Coin Report, it might be worth reading this section of the first report, where any potentially unfamiliar terms are explained. For any terms or metrics specific to this post, I will provide explanations besides the figures.
Metrics:
General:
Price: $0.0039 (36 satoshis)
Circulating Supply: 19,192,345 EXCC
Total Supply: 19,192,345 EXCC
Exchange Volume: $1.758mn (discounting TopBTC, which is likely primarily wash-trading, volume is effectively zero)
Network Value: $74,302
Maximum Supply: 32,003,133 EXCC
% of Max. Supply Minted: 59.97%
Network Value at Max. Supply: $123,898
Exchange Volume-to-Network Value: 2367.29% (again, very likely to be effectively zero when wash is discounted)
Category: Microcap
Average Price (30-Day): $0.0035
Average Exchange Volume (30-Day): N/A (no data available)
Average Network Value (30-Day): N/A (no data available)
Average Exchange Volume (30-Day)-to-Network Value: N/A (no data available)
Average Daily On-Chain Transactions (30-Day): 6849 (source)
Average Daily Transactional Value** (30-Day): N/A (no data available)
NVT*** (30-Day): N/A (no data available)
Volatility* (30-Day): -0.83044
% Price Change USD (30-Day): +59.8%
% Price Change USD (1-Year): -91.3%
USD All-Time High: $0.26
% From USD All-Time High: -98.6%
Premine % of Max. Supply: 37.95%
Premine Location: https://explorer.excc.co/tx/41417caea7b3a5e345ff0abf3a0c715fa9fc94a44178747da9aee1bfff9742cf
Liquidity (calculated as the sum of BTC in the buy-side with 10% of current price across all exchanges): 0.000766 BTC
Liquidity-to-Network Value %: 0%
Supply Available on Exchanges: 511,162 EXCC
% of Circulating Supply Available on Exchanges: 2.66%
*Volatility is calculated by taking the average price over the given time-period, calculating the difference between it and the highest price and it and the lowest price over that same time-period, and multiplying those figures together. The closer to 0, the less volatility during that period, and vice-versa. Read this for more on volatility.
Supply Emission & Inflation:
Block Reward Schedule: Current block reward is 24.5 EXCC, with progressively diminishing rewards.
Average Block Time: 2.5 minutes
Current Block Height: 227,944
Annual Supply Emission (maximum): 5,150,880 EXCC (based on current block reward – this will definitely be lower in practice)
Annual Inflation Rate: 26.84%
Circulating Supply in 365 Days: 24,343,225 EXCC
Staking & Masternodes:
Network Staking Weight: N/A (no source)
Staking ROI (Annual): 8.05% (minimum, if all coins are staked)
Masternode Collateral Size: N/A
Masternode Price: N/A
Masternode Count: N/A
Masternode Count Growth (30-Day): N/A
Supply Locked in Masternodes: N/A
Masternode ROI (Annual): N/A
Masternode Reward / Block Reward: N/A
MNV / Network Value: N/A
ICO:
The following details were taken from this source.
ICO Period: November 2017 – December 2017
Total Tokens: 32mn EXCC
Tokens Available For Sale: 4mn EXCC
Total Raised: 650 BTC (over $5,000,000)
Average ICO Price Per Token: 0.00016250 BTC
Distribution:
Address Count: N/A (no source available)
Supply Held By Top 10 Addresses: N/A
Supply Held By Top 20 Addresses: N/A
Supply Held By Top 100 Addresses: N/A
Inactive Address Count in Top 20 (30 Days of No Activity): N/A
Analysis:
Whilst there is rather a lot here to work through, the load is somewhat lightened by the lack of data sources for key metrics, which is a shame. In fact, I could find no publicly-available data sources for Distribution, Staking or Transaction-related metrics, and, due to the apparent lack of liquidity or legitimate volume, there General section is also somewhat reduced.
Nonetheless, let us begin with the available General metrics, before moving onto the other sub-sections:
Regarding transactional data, the only available information is the average number of on-chain transactions per day, which amounted to 6,849 for the past 30 days.
Moving on, I’d like to take a look at Volatility, which I calculated to be -0.83044 for the past 30 days; this places ExchangeCoin highest amongst prior reports for 30-day volatility, which is almost 2.5x greater than the second-highest: X42 Protocol. This is completely expected given that ExchangeCoin’s market cap is less than $100,000 with little to no real volume.
Next up, we have the metrics relating to Liquidity:
Disappointingly, there was almost zero buy-side liquidity to be found on any of the exchanges, including TopBTC, which reports over $1mn 24-hour volume for the EXCC/BTC pair, but has less than 0.001 BTC in the bid within 10% of current prices, equating to less than 0.01% of its Network Value. Effectively, there is no liquidity and no real volume, rendering ExchangeCoin virtually untradeable and not fit for our speculative purposes at present. That said, there may be fundamental value here beyond the metrics that we can monitor moving forward.
As for sell-side liquidity, I found that 511,162 EXCC was available for purchase in the orderbooks, equating to 2.66% of the circulating supply. This places the project somewhere in the middle amongst prior reports, indicating that, whilst there is clearly no demand for the coin at current prices, there is also relatively little desire to sell; those with EXCC are largely holding, for whatever purpose.
Moving onto volume, EXCC is reported to have traded $1.75mn of exchange volume; however, this is indisputably primarily wash-trading on TopBTC, with neither CoinExchange or XULT featuring any trade volume for the project. Thus, there is near-zero real volume being traded and certainly not 23x the Network Value of the project on a daily basis, as TopBTC would have us believe.
Now, let’s take a look at Supply Emission:
Given that ExchangeCoin has 2.5-minute block times and a progressively diminishing block reward (currently at 24.5 EXCC), we can determine that the maximum annual supply emission is 5.15mn EXCC, though it is most certainly going to be less than this due to the diminishing reward. This gives EXCC a maximum annual inflation rate of 26.84%.
Whilst this would commonly be followed by an analysis of the relationship between traded volume and supply emission, there is no volume to discuss, thus even the moderate inflation rate is simply too much for current prices to be sustainable. Until the team can conjure demand for the coin at current prices (by incentivising holding or by getting listed on more popular exchanges), the supply emission will continue to act as headwinds for growth.
Regarding Staking, I was unable to find the Network Staking Weight, thus I have provided a minimum annual ROI calculation, based on all the circulating supply being staked, which is highly unlikely; at 8.05%, however, this would not be an incentive for holding, given that annual inflation is 3x higher.
Unfortunately, we are also unable to evaluate the Distribution of the coin, as there is no rich-list available and no address count, thus concluding this section on metrics.
Let’s now take a look at the Community:
Community:
There are two primary aspects of community analysis: social media presence and Bitcointalk threads. I’ll begin with the former before moving on to the latter.
Social Media:
Concerning social media presence, there are four main platforms to examine: Twitter, Facebook, Telegram and Discord.
ExchangeCoin is present on three of these platforms, all except Facebook. To begin, let’s look at the various social metrics that I calculated from the ExchangeCoin Twitter and Facebook accounts:
Twitter Followers: 3,478
Tweets: 1,397
Average Twitter Engagement: 0.49%
Facebook Likes: N/A
Facebook Posts (30-Day): N/A
Average Facebook Engagement: N/A
As usual, I will be using RivalIQ‘s social benchmark report for evaluation purposes.
Twitter:
ExchangeCoin has a moderately-sized audience on Twitter of 3,478 followers, which places it somewhere in the middle of the pack. To match this, it has fairly consistent engagement but the team do not appear to utilise the account to a great degree, with very few tweets over the past month. The average engagement rate is 0.49%, which is also around the middle relative to other projects. Relative to global benchmarks, this is 54.4 greater than the Media industry and 10.2x greater than the average across all industries.
Facebook:
There is no Facebook page for ExchangeCoin.
Discord:
The ExchangeCoin Discord group has 394 members.
There is an index of channels provide to ensure ease-of-access for new users, with the Information menu containing a Tutorials channel, linking to a number of relevant guides, and an Announcements channel that mirrors the Telegram news channel that I shall cover in the next section.
Beyond this, there is a Main menu, which contains the bulk of the group’s channels. Here, we find a Support channel, where prompt assistance is provided to users facing issues, as well as a number of channels specific to the three platforms of the ecosystem: Xult, XClouder and Xchange.me. There is also a channel for tickets, staking and mining that contains useful information regarding network hashrate and block rewards.
However, the channel we are most concerned with is General, which is most commonly the most popular channel in a Discord. However, there is little to no activity here, with no messages in the past week.
The community engagement is virtually non-existent in this group. Let us hope we find more activity in the Telegram…
Telegram:
There are 2,856 members in the News channel and 412 members in the ExchangeCoin chat.
Whilst I shall briefly cover the former, for our purposes of evaluating the community, I shall deal primarily with the latter.
Firstly, regarding recent news, there have been 3 announcements in August, one of which was a link to a piece of content on mining; one of which was the Xult exchange going live after maintenance; and the final was the addition of HempCoin to their Xchange.Me platform. Beyond this, there is nothing in the news channel since July.
As for the chat, there is a moderate amount of activity, considering the small size of the group, with daily discussion taking place, though certainly not constantly.
Over the past week, I found that any issues with the services or platforms were quickly resolved by the team, and that much of the discussion was general rather than specific to the project. I also found that Komodo and HempCoin were recently given support on the XClouder platform and Hempcoin was also added to XChange.Me (cloud hosting and coin exchange, respectively). The team are also actively seeking to accrue value to the EXCC token (promising to see, given how poor the metrics are at present); they are currently offering a triple-listing across their platform ecosystem, to be paid in EXCC. Whilst, as I say, this is promising, it may be difficult to push this given the illiquidity of the market. I think that seeking out new exchange listings would likely provide some degree of additional liquidity, which would make the value-driven efforts more effective.
On this topic, I found that there is a possibility that TradeSatoshi may list the token, as the exchange is being integrated to Xchange.Me. Further, there is active engagement from the community, with many providing suggestions on possible partnerships to pursue to further the reach of ExchangeCoin, which is encouraging.
BitcoinTalk:
The ExchangeCoin BitcoinTalk thread was created on September 7th, 2018, and has since generated 45 posts spanning 3 pages in 347 days. This equates to 0.13 posts per day, on average. However, in the past 90 days, the thread has had only 2 posts, both of which were in May, rendering the thread effectively dead.
Regarding the announcement itself, there is very little of note, with most of the images showing up as invalid. The parameters for EXCC are still visible, as are the team and the platform ecosystem. Beyond this, there is nothing.
Despite the thread clearly being dead, it would help if this announcement were updated, as BitcoinTalk is often one of the first places new users visit to learn more about a project.
And that concludes this section. Onto Development:
Development:
For the following Development analysis, I will be evaluating project leadership, the website, the roadmap, the whitepaper, the wallets and finally providing a general overview:
Project Leadership:
There are only two team members listed on the website, but the entire team of ten core members is listed on CoinPaprika and in the whitepaper. Further, there are over 50 Github contributors.
The team is very much development-focused, with much experience across all fields of development and programming, but very little in any other field of expertise; this needs re-balancing, which I expect would also help to solve a number of the issues regarding marketing and speculative interest.
Website:
The website is modern in its design, visually appealing and easy to navigate. It is also well-branded and highly informative, with a relevant navigation menu featuring an FAQ and an About EXCC page, as well as a News page featuring (irregular) updates. Social links are somewhat hidden, to be found in the footer of the homepage.
As for the site copy, this clearly needs some work, as it is not particularly engaging. The first line of the first section of copy reads: The Exchange Coin is a cryptocurrency; it was created in 2017. This is the first text that the eye is drawn to and should capture visitors.
The key features of the project are highlighted well, with decentralization, transparency, security and customer service emphasized as the core traits of their ecosystem. Beyond this, we find links to the current platforms and are informed of the DEX that is scheduled for release next year. Following this, we find the roadmap, which I cover in the next section, and links to exchanges and wallets.
Overall, well-designed and informative but needs polishing up.
Roadmap:
The roadmap is native to the website homepage and relatively well-presented, with a timeline of events, past and present, visible. Further, accomplished goals have been crossed out.
I shall refrain from going over past achievements, instead looking at present and future aims:
Firstly, however, it is important to note that all historical goals have been accomplished except for listing on CoinMarketCap.
Present goals begin with the first half of 2019, though it appears only one of these has been achieved thus far: the launch of Xult.com.
Beyond this, there is a roadmap update (required), final version of the Exilibrium wallet, Xchange.Me 2.0 beta testing and VUI and chatbot integrations to Xult yet to be completed.
For the second half of 2019, the team are aiming to release the first version of their decentralised exchange with basic cross-chain trading.
Moving onto the first half of 2020, it is expected that there will be a final security audit of the DEX, the mainnet release of the DEX and its enhanced functionality.
As for the future beyond this, the roadmap mentions advanced trading features and portfolio management.
The roadmap itself could be improved by adding Further Reading links to the events to allow users to learn more, if they so wish.
Whitepaper:
https://excc.co/EXCC-WhitePaper.pdf
The whitepaper is fairly concise at 21 pages in length, and begins by stating the purpose and aims of ExchangeCoin, which are to bridge the gap between centralized and decentralized exchanges, allowing for seamless transactions, security for users and full transparency. This is set to be achieved by their multi-platform ecosystem, comprising of a decentralised exchange, an exchanger, and a centralised exchange (EXCC-DEX, Xchange.me and Xult).
Xchange.me arbitrages other exchanges to deliver the best prices for crypto transactions, with no login requirements. Those that hold EXCC get 50% discounts on transaction fees.
Xult will act as the centralised exchange, with multiple order options, user-friendly interfaces and a plethora of trading pairs. EXCC will be used for trading fee discounts and other benefits.
Finally, the EXCC-DEX is the main goal for the team, as they seek to deliver a fully decentralised exchange that remains as usable and user-friendly as a centralised exchange and does not fall behind in performance. The beta release is expected this year and the DEX will aim to facilitate over 1,000 transactions per second.
The DEX will be open-source and will allow contributions via Github, the Exilibrium wallet and community channels.
We are then told about EXCC as a token, with the following utilities highlighted: holders can vote on a selection of masternodes that perform transactions on the DEX; lower transaction fees; vote to add coins to the exchange; paying for listings; exclusive benefits; and utilization of the built-in staking mechanism, allowing holders to obtain Masternode leases.
Following this, there is a section on the EXCC Blockchain, which covers the parameters of the token itself, as well as the 70/30 split of the block reward between miners and stakers (70% for miners, 30% for stakers). Block times will be 2.5 minutes, with a maximum supply of 32mn EXCC and a premine of 12mn EXCC, with the network operating on the Equihash hashing algorithm. The block reward itself began at 38 EXCC, diminishing every 16,128 blocks.
Regarding Proof-of-Stake, stakeholders are given voting rights in a governance system, and their EXCC are eligible to be staked by purchasing a ticket that locks a specified amount of EXCC; a single vote can also be cast per ticket. Once the vote is submitted and the EXCC is released, an additional reward is released. Every 144 blocks, staking difficulty is used to generate a new ticket price, to maintain a ticket pool size of approximately 40,960 tickets. A ticket must be used to submit a vote in order to gain its additional reward, and 99.5% of tickets will be eligible.
The document concludes with a brief biography of all the core team members, with full transparency provided, as well as a condensed roadmap.
Overall, thorough and yet concise.
Wallets:
There is a web wallet, a mobile wallet and desktop wallets for all operating systems.
General:
What I would like to draw attention to in this final section is that, despite the many weaknesses I have covered in this report, the team have managed to release three working products, culminating in an exchange ecosystem that deserves credit. The vast majority of projects have yet to release a single working product. Further to this, the platforms themselves are indeed (for the most part) what they were promised to be: Xult is fast and functional; XChange.me is modern and seamless, though in need of some proofreading; and XClouder is intuitive and visually appealing.
And whilst I credit the team for these releases, especially as a microcap project, I must also mention that they did raise 650 BTC in an ICO, premining 37% of the maximum supply to provide, in part, for the token sale. This premine far exceeds what I tend to deem necessary for development purposes and 650 BTC is a lot of money; many projects have accomplished more with far less, so I cannot be too congratulatory here.
Nonetheless, there is plenty to be worked on and improved here, but the core ecosystem of platforms and services is already in existence; the team must now leverage these to provide value to the token, else it has little use and will continue to be swamped by sell pressure.
Technical
EXCC/BTC
Daily:
1H:
As can be immediately observed, there is very little volume for the vast majority of the price-history, rendering technical analysis somewhat useless; further, the recent volume is predominantly wash.
However, we can see that, as per CoinPaprika’s data, EXCC put in an all-time high of ~1800 satoshis in November 2018, following which price has continued to bleed, making new lows with each week, eventually making an all-time low of 8 satoshis in June. Since then, price has bounced almost 5x, although these sort of swings are expected when there is no buy-side liquidity and little to no volume.
In all honesty, I would not be interested in buying EXCC until it is listed on more exchanges, and you would be unable to fill a position in it given current liquidity without significantly moving price. These issues must be resolved.
Conclusion
This report is now over 4,000 words, and it is time to draw it to a close.
My final grading for ExchangeCoin is 3 out of 10.
Here, you can find my grading framework, for reference.
Lastly, here is a link to a Google Sheets file with any significant data from previous reports compiled for cross-comparative purposes. I will keep this updated as I continue to write these reports.
I hope this report has proved insightful and that you’ve enjoyed the read! Please do feel free to leave any questions in the Comments, and I’ll answer them as best I can.
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There was no 12 million premine!
The premine was about 8 million.
The indiscrepancy here stems from the fact that the blockchain was forked to have the POW/POS hybrid implementation.
Therefore, the 4 million coins was IN ACTUALITY mined in 2018.
It quite clearly states in the whitepaper that the premine is 12mn coins, as does the block explorer for block 1