You are currently viewing Coin Report #74: LTOxVIDT

Coin Report #74: LTOxVIDT

Welcome to the 74th Coin Report. In today’s report, I will be assessing the fundamental and technical strengths and weaknesses of LTOxVIDT, which is the recent merger between LTO Network and VIDT Datalink. 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

This is the eight of my subscriber-exclusive Coin Reports, with LTOxVIDT winning the January poll, tied with Fetch.ai (that report can be found here). Each month, I will run a poll and publish a Coin Report on the winner either that month or the following month, available only to those of you that are subscribed to my premium content.

Keep your eyes out for the February poll, which will be hitting your inboxes soon.

As a side note before I begun this report, I’d like to mention that this one will be quite different to the regular reports, as this is intended as a primer for the recent merger between LTO Network and VIDT Datalink (or, more accurately, the acquisition of the latter by the former). Given that both have independent tokens – LTO and VIDT – and that both will remain in existence for the time being, I will be providing updated metric analysis on both, followed by a brief look at their respective communities, and crucially an evaluation of recent progress, the acquisition and what it means going forward, concluding with some technical analysis on both tokens. This report will not feature the usual coverage of whitepapers, websites and other such material usually found in the Development section, as this has been covered in previous independent reports written on both projects, which can be found here. Instead, I want this report to provide some insight on the state of the tokens, the implications of the merger and the speculative prospects moving forward.

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 LTO Network and VIDT Datalink prior to reading this report, here are some primary links:


Fundamental Analysis

General:

Name: LTO Network & VIDT Datalink (LTOxVIDT)

Ticker: LTO / VIDT

Algorithm: ERC-20 & Mainnet (LTO) and ERC-20 & BEP-2 (VIDT)

Sector: Decentralised Workflow (LTO) and Data Validation (VIDT)

Exchanges: LTO: Binance, Uniswap, Hotbit, Bilaxy, BitMax, Omgfin and Binance DEX

VIDT: Binance, Bilaxy, Kucoin, Hotbit, Uniswap, Hoo.com, BKEX, Binance DEX and SecondBTC


Metric Analysis:

Below are listed a number of important metrics, all of which are accurate as of 23rd January 2020. 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.

LTO Network

Metrics:

General:

Price: $0.219 (689 satoshis)

Circulating Supply: 272,997,447 LTO (source)

Total Supply: 403,393,276 LTO

Maximum Supply: 403,393,276 LTO

% of Max. Supply Minted: 100% (deflationary, 97.7mn burned thus far)

Network Value: $59,814,287 (1,880.95 BTC)

Network Value at Max. Supply: $88,384,274

Exchange Volume: $13,609,823 excluding wash

Exchange Volume-to-Network Value: 22.75%

Category: Midcap

Average Price (30-Day): $0.174

Average Exchange Volume (30-Day): $9,694,317

Average Network Value (30-Day): $47,274,509

Average Exchange Volume (30-Day)-to-Network Value20.51%

Volatility* (30-Day): -0.1922

Average Daily On-Chain Transactions (30-Day): 79,104 (source)

Average Daily Transactional Value** (30-Day): N/A

NVT*** (30-Day): N/A

% Price Change USD (30-Day): +131.2%

% Price Change USD (1-Year): +327.7%

USD All-Time High: $0.27

% From USD All-Time High: -18.7%

Premine % of Max. Supply: N/A

Premine Location: N/A

Liquidity (calculated as the sum of BTC in the buy-side with 10% of current price across all exchanges): 7.91 BTC

Liquidity-to-Network Value %: 0.42%

Supply Available on Exchanges: 14,382,194 LTO

% of Circulating Supply Available on Exchanges: 5.27%

*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: N/A

Average Block Time: 0

Current Block Height: 1,088,489

Annual Supply Emission: 0

Annual Inflation Rate0%

Circulating Supply in 365 Days: N/A

 

Distribution:

Address Count: 4300 (ERC-20) + 1514 (BEP-2) + 3337 (Mainnet)

Maximum Supply Held By Top 10 ERC-20 Addresses: 4.15%

Maximum Supply Held By Top 20 ERC-20 Addresses: 5.73%

Maximum Supply Held By Top 100 ERC-20 Addresses: 8.24%

Inactive Address Count in Top 20 (30 Days of No Activity): 13

 

Analysis:

I’d like to begin by looking at the limited transactional data available and then move onto the remaining General metrics, the lack of supply emission and conclude with some Distribution analysis.

So, whilst I was unable to find any data on value transacted on-chain, I was able to find some on total transactions, with the Average Daily On-Chain Transactions coming in at 79,104 for the month of December. Further, as can be seen on the chart below, the average number of daily mainnet transactions has been growing steadily for the past year.

daily_transactions_dec

Moving on, I’d like to take a look at Volatility, which I calculated to be -0.1922 for the past 30 days; this places LTO Network 14th-highest amongst prior reports for 30-day volatility, indicating that there we may well be in the midst of a cycle, at least against the Dollar. This will be delved into more deeply a little later in the report.

Next up, we have the metrics relating to Liquidity:

Firstly, I found that there was 7.91 BTC of buy-side liquidity within 10% of current prices to be found across all exchanges, equating to 0.42% of its Network Value. This places LTO Network somewhere in the middle relative to projects previously featured in these reports, indicating some degree of demand at current prices.

As for sell-side liquidity, I found that ~14.382mn LTO was available for purchase in the orderbooks, equating to 5.27% of the circulating supply. This is again somewhere in the middle among prior reports, indicating a moderate desire to sell at any price. Overall, there is no overwhelming supply/demand imbalance here, at present.

Moving onto volume, LTO Network traded $13.6mn of Exchange Volume over the past 24 hours, equating to 22.75% of its Network Value; more impressively, it has sustained a high level of traded volume over the past 30 days, with Average Exchange Volume of $9.69mn, equating to 20.51% of its Average Network Value for the same period. This is the 4th-highest figure recorded, suggesting that there is certainly speculative interest in LTO.

Now, let’s take a look at (the lack of) Supply Emission:

Given that LTO was distributed via token sale, there is a maximum supply of ~403mn LTO that is already in existence, with ~97mn LTO having been burned, thus there is effectively no supply emission. Thus, annual inflation is 0%. In practice, there is engineered deflationary pressure, as the Bridge connecting the three chains burns a number of LTO each time certain transactions occur.

Given the lack of supply emission and the moderate amount of LTO available for purchase in the orderbooks, one would expect there to be little to no headwinds for price appreciation moving forward.

Finally, let us take a look at some Distribution:

Using the rich-list, I found that there are currently 4,300 holders of LTO on the ERC-20 chain. There are also 1,514 addresses on BEP-2 and 3,337 on mainnet. Further, approximately 84.8mn LTO of the total supply is currently held on the ERC-20 chain, with 125.9mn LTO currently being staked on mainnet.

Moreover, I found that the top 10 richest addresses control 4.15% of the maximum supply; the top 20 control 5.73%; and the top 100 control 8.24%. However, this excludes the team and exchange addresses within these groups and only considers ERC-20 addresses, as mainnet data is unavailable. The team and exchange addresses in the top 20 control 24.26m LTO. Finally, 31.21% of the maximum supply is currently being staked.

Regarding the activity of the top 20 addresses, I found that 13 were inactive over the past 30 days. Of the remaining 7 addresses, 2 were in active distribution and 5 in accumulation, with net cumulative inflows of +772,771 LTO over the past 30 days.


VIDT Datalink

Metrics:

General:

Price: $0.54 (1,718 satoshis)

Circulating Supply: 46,282,792 VIDT

Total Supply: 56,665,146 VIDT

Maximum Supply: 56,665,146 VIDT

% of Max. Supply Minted: 100% (deflationary)

Network Value: $25,285,400 (795.14 BTC)

Network Value at Max. Supply: $30,957,529

Exchange Volume: $1,499,734 excluding wash

Exchange Volume-to-Network Value: 5.93%

Category: Lowcap

Average Price (30-Day): $0.58

Average Exchange Volume (30-Day): $2,360,707

Average Network Value (30-Day): $26,883,693

Average Exchange Volume (30-Day)-to-Network Value: 8.78%

Volatility* (30-Day): -0.0369

Average Daily On-Chain Transactions (14-Day): N/A

Average Daily Transactional Value** (14-Day): N/A

NVT*** (14-Day): N/A

% Price Change USD (30-Day): +38.3%

% Price Change USD (1-Year): +467.4%

USD All-Time High: $1.22

% From USD All-Time High: -53%

Premine % of Max. Supply: N/A

Premine Location: N/A

Liquidity (calculated as the sum of BTC in the buy-side with 10% of current price across all exchanges): 5.37 BTC

Liquidity-to-Network Value %: 0.68%

Supply Available on Exchanges: 3,114,713 VIDT

% of Circulating Supply Available on Exchanges: 6.73%

*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: N/A

Average Block Time: N/A

Current Block Height: N/A

Annual Supply Emission: 0

Annual Inflation Rate0%

Circulating Supply in 365 Days: N/A

 

Distribution:

Address Count: 6217 (ERC-20) + 2812 (BEP-2)

Supply Held By Top 10 Addresses: 21.03%

Supply Held By Top 20 Addresses: 23.94%

Supply Held By Top 100 Addresses: 33.37%

Inactive Address Count in Top 20 (30 Days of No Activity): 14

 

Analysis:

Whilst VIDT Datalink does have its own transparent dashboard on validations (its core purpose) that we will certainly be looking at a little later, I’d like to open up this section by looking at the General metrics, followed by Supply Emission (which, like LTO, is actually deflationary) and concluding with Distribution.

The first thing I’d like to point out is that VIDT is relatively low in volatility at present, with  30-day Volatility of -0.0369 (around a fifth of that of LTO). This indicates that VIDT may well be under accumulation against the Dollar, which I’ll look at towards the end of this report.

Moving on, let’s take a look at the Liquidity-related metrics:

VIDT Datalink was calculated to have buy-side Liquidity of 5.37 BTC, which equates to 0.68% of its Network ValueThis is greater relative liquidity than was observed for LTO and places VIDT in the top quarter of previous reports, also being indicative of good demand at current prices.

As for its sell-side Liquidity, I found there to be 3,114,713 VIDT listed for sale on exchanges, equating to 6.73% of its Circulating Supply. Again, this is a higher figure than was found for LTO, although only marginally higher this time, suggesting that whilst there is a fairly high degree of desire to sell at any price, there does appear to be more of an imbalance here. This is positive for speculators in VIDT.

Moving onto volume, I found that VIDT Datalink traded $1,499,734 over the past 24 hours, equating to a 5.93% of its Network Value. This is much tamer than for LTO, but still solid. As for its Average Daily Exchange Volume, I calculated this to be $2.36mn, equating to an impressive 8.78% of its Average Network Value for the 30-day period. This is among the top 10 of prior reports but does not quite match LTO’s ~20% figure.

Now, what about Supply Emission:

Well, to put it briefly, there is none. As is the case with the majority of ICOs, the maximum supply is that which is created upon the close of the token sale, so there is never any further supply emission for price to contend with. This is great for speculators, as it means that there are no headwinds for price appreciation. As such, VIDT Datalink’s annual Inflation Rate is 0%. (In fact, as we have already established, VIDT is in deflation, whereby each year the maximum supply is decreasing as tokens are burned alongside the growth of the business, as I shall provide an update on a little later).

Finally, let’s take a look at Distribution:

Using the rich-list, I found that there are currently 6,217 holders of VIDT on ERC-20 and 2,812 on BEP-2.

Moving beyond this, the top 10 addresses control 21.03% of the maximum supply; the top 20 control 23.94%; and the top 100 control 33.37%. This is excluding team and exchange addresses, which control ~23.95mn VIDT in the top 10.

As for the activity of the top 20 richest privately-owned addresses, I found that 14 were inactive over the past 30 days, and that, of the remaining 6 addresses, 4 were distributing from their positions and 2 were accumulating. There were net cumulative outflows of -1,262,228 VIDT over the past 30 days.

That concludes my evaluation of the metrics for both LTO and VIDT; let’s now take a look at their respective communities.


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.

LTO Network

Social Media:

Concerning social media presence, there are four main platforms to examine: Twitter, Facebook, Telegram and Discord.

LTO Network is present on two of these platforms: Twitter and Telegram. To begin, let’s look at the various social metrics that I calculated from the LTO Network Twitter account:

Twitter Followers: 832 (old account appears to have been suspended)

Tweets: 10

Average Twitter Engagement: 26.39%

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:

The LTO Network Twitter account was suspended and their new account remains quite small at 832 followers, with its engagement reflecting the tiny audience at a huge 26.39%. In RivalIQ’s report, we find that the average Twitter engagement rate across all industries is 0.045%, which means that LTO Network’s engagement rate is 586x greater. Further, the average engagement rate for the Tech and Software industry (the most relevant in the report) is 0.027%, thus LTO Network’s is 977x greater. However, naturally this is a symptom of the size of the audience alongside the fact that the two communities of LTO Network and VIDT Datalink will very likely be sharing and engaging with the content of one another. As such, a more accurate measure of engagement will have to wait until the LTO Network audience size grows.

Facebook:

There is no Facebook page for LTO Network.

Discord:

There is no Discord group for LTO Network.

Telegram:

There are 13,764 members of the LTO Network Telegram group.

  • There is a fairly high degree of activity in the group, with some discussion occurring throughout the day, though it is not constant.
  • Much of the activity isn’t necessarily focused on LTO Network itself but rather general discussion and some memes (not necessarily a bad thing, of course).
  • Support queries are responded to promptly, which is good to see.
  • Transactions on mainnet are now exceeding 100,000 per day.
  • LTO Network is expecting to release an Oracle collaboration with Chainlink in Q3, along with Cross-chain Associations and Identity Workflows later this year.
  • Beyond this, there is very little of note to take from recent activity in the group, unfortunately.

BitcoinTalk:

There is no BitcoinTalk thread available for LTO Network.


VIDT Datalink

Social Media:

Concerning social media presence, there are four main platforms to examine: Twitter, Facebook, Telegram and Discord.

VIDT Datalink is present on two of these platforms: Twitter and Telegram. To begin, let’s look at the various social metrics that I calculated from the VIDT Datalink Twitter account:

Twitter Followers: 24,515

Tweets: 785

Average Twitter Engagement: 0.94%

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:

The VIDT Datalink Twitter account is much larger, at 24,515 followers, with its engagement remaining moderate at 0.94%. As previously mentioned, in RivalIQ’s report, we find that the average Twitter engagement rate across all industries is 0.045%, which means that VIDT Datalink’s engagement rate is 21x greater. Further, the average engagement rate for the Tech and Software industry (the most relevant in the report) is 0.027%, thus it is 34.8x greater. Relative to prior reports, VIDT Datalink is in the top half.

Facebook:

There is no Facebook page for VIDT Datalink.

Discord:

There is no Discord group for VIDT Datalink.

Telegram:

The VIDT Datalink Telegram group has 7,665 members.

  • There is a significant amount of activity in the group, with constant discussion by many community members.
  • The team remain burning 20% of all VIDT used for validations each month.
  • A large new client is expected to be on-boarded at the end of January, with validations expected to be limited at first and ramp up throughout 2021.
  • Rick, the LTO Network CEO and now CEO of both projects, has made his presence known in the group recently following some calls by community members for more activity from him.
  • LTO clients are in the process of being ported to VIDT over the coming weeks, thus increases in validations are expected.
  • More joint projects are expected to be announced in February.

BitcoinTalk:

The V-ID BitcoinTalk thread was created on August 18th, 2018 and has since generated 127 posts spanning 7 pages in 892 days. This equates to 0.14 posts per day, on average. However, in the past 90 days, the thread has had 1 post. Clearly, the thread is no longer in active use.

And that concludes my update on the two respective communities; now for the most important part of this report – the merger:


LTOxVIDT:

The purpose of this report is primarily to cover the recent acquisition of VIDT Datalink by LTO Network and highlight its implications for both projects, so I have provided my key takeaways from all publicly available materials below (with sources linked at the bottom):

  • The merger was announced mid-December, with the reasoning behind the merger stated to be to allow for both organisations to be better equipped to challenge larger competitors and to make both projects operate more efficiently.
  • All LTO Network clients will be utilising VIDT Datalink technology and vice-versa, with LTOxVIDT also pooling together sales, marketing and development resources.
  • It is expected that the merger will allow LTOxVIDT to becomes a more comprehensive business solution, due to the wider array of skills among the respective teams that can now be utilised by both.
  • Major exchanges are more likely to be interested in both projects following the merger, according to their announcement.
  • Both parties operate from the Netherlands and have been working together for years as it is, thus the merger has emerged as a strategic move from their existing relationship.
  • They expect both companies to reach the top 20 blockchain projects; or that is at least their goal.
  • VIDT Datalink will remain focused on document anchoring and data validation, as well as on NFTs, whilst LTO Network will focus on business operations and GDPR compliance.
  • The common vision is a world in which hybrid blockchain solutions are ubiquitous and are utilised by traditional corporations.
  • The total value locked of VIDT for all transactions will transfer to the LTO blockchain, with 150,000 VIDT anchor expected post-merger as opposed to 5,725.
  • LTO Network will function as the back-end platform for solutions whilst VIDT is the user-friendly client solution.
  • The merger will also increase the client-base for VIDT thus allowing for greater usage of the VIDT token and subsequently increase token buy-backs and deflationary pressures.
  • Staking is expected to be implemented for VIDT in order to further improve token utility following the merger.
  • LTO Network grew significantly throughout 2020 regarding on-chain performance, with almost 100,000 daily transactions processed in December 2020.
  • Importantly, recently the team announced that for each VIDT token bought and burned as part of their mechanism, an equivalent LTO token will be bought and burned, beginning in January.

https://vidtdatalink.medium.com/competing-on-the-open-market-against-established-players-can-be-challenging-for-start-ups-and-97738ff254ce

https://blog.ltonetwork.com/lto-network-and-vidt-datalink-merge-to-become-the-front-to-back-b2b-blockchain-solution-2/

https://blog.ltonetwork.com/ltoxvidt-work-together-burn-together/

https://blog.ltonetwork.com/lto-network-adoption-growth-overview-of-q4-2020/

https://vidtdatalink.medium.com/lto-x-vidt-ama-8d0afeb938f7

And that concludes my fundamental evaluation of both LTO Network and VIDT Datalink.


Technical Analysis

VIDT

VIDT/USD

VIDTUSDWeekly

VIDT/BTC

VIDTBTCWeekly

Beginning with VIDT, let’s first take a look at the VIDT/USD chart, as the token had a very good 2020 and pushed to new all-time highs.

Looking at the weekly, we can see that the pair rallied from an all-time low sweep in March 2020 at $0.045 to a new all-time high at $1.21 in August. This became the top and subsequently the pair retraced around 80% towards an area of prior resistance now turned support at $0.28. VIDT managed to hold above this low and began pushing higher in November, reclaiming the previous all-time high at $0.55, breaking higher into $0.96, but printing a lower-high there and subsequently a higher-low at $0.36. In short, the pair is quite clearly in macro consolidation, though it is now starting to hold above that historical ATH at $0.54 as support, and if this becomes the base, any rally higher will no doubt retest the current ATH at $1.21. In fact, RSI has reset significantly and there is plenty of room to push higher before it wanders into an extreme. Looking ahead, I would expect to see $2.20 get tested as a new all-time high in 2021, as the 1.618 extension of the trend.

Turning to VIDT/BTC, here we can see the pair has retraced from the all-time high at 10,500 satoshis right into the area I had highlighted in previous posts as a potential new cyclical bottom: prior range resistance at 1,600 satoshis, now turned support for several weeks. I like that the pair is finding a base here, as it opens up the possibility of a second wave, with 4,200 satoshis the next major resistance above, and 5k satoshis above that. Ultimately, I do think VIDT has the potential to retest that all-time high at 10,500 satoshis in 2021, and the invalidation here is explicit: a weekly close below range support at 840 satoshis, following which we would no doubt see that all-time low get swept.


LTO

LTO/USD

LTOUSDWeekly

LTO/BTC

LTOBTCWeekly

LTO had a similarly impressive 2020, though not quite as euphoric as that of VIDT but without the huge retracement too.

If we begin by looking at the weekly chart for LTO/USD, here we can see that the pair has been in a parabolic advance since March 2020, when it retested but failed to break below the all-time low at $0.02. Following that, it ran all the way into resistance at $0.16 in December, pulled back into prior resistance turned support (and the parabolic curve) at $0.10 and has since ran to new all-time highs on rising volume, with this past week pushing to $0.27. I would expect to see this rally accelerate from here, with $0.37 the next key area of resistance. Above that, $0.45, and above that $0.59 at the 2.618 extension of the bear market cycle. Certainly one to buy on dips.

Turning to LTO/BTC, here we can see that price has been in a range between the all-time low at 265 satoshis and resistance at 915 satoshis for over a year, but the last three weeks have seen the pair trade much higher volume and push off the double-bottom at 350 satoshis towards that range resistance. The first major bull signal for a much bigger rally will come if and when LTO is able to close the weekly above 915 satoshis, which it has failed to do on 10 separate occasions. Break above that, and the next resistance is another 50% rally higher at 1440 satoshis, with 2,200 satoshis acting as resistance further ahead. However, fail at 915 satoshis and I’d be looking for the pair to retest the double-bottom at 350 satoshis. Plenty of upside here should we get that breakout…

And that concludes my evaluation of LTOxVIDT.


Conclusion

This report is now over 4,000 words, and it is time to draw it to a close.

My final grading for both LTO Network and VIDT Datalink is 8 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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This Post Has 4 Comments

  1. machouno

    Nik, fantastic report as usual. VIDT is is strong downside on the BTC pair. Surprising for such a project. Do you think we’ll break below the ATL ? Thanks a ton.

    1. Nik

      Nope – I think this range will hold, deflationary supply should be enough incentive to hold the range support.

  2. Jordan Lancaster-graham

    Terrific report! thanks Nik. Looks like this move might benefit both but maybe favour VIDT more favourably. Will be setting some orders for this for sure.

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