Binance, the world’s largest cryptocurrency exchange, recently launched a service to help traders study its listed coins and tokens. Binance Info aims to be a one-stop-shop for crypto investing. CoinIQ’s review of Binance Info found some truth to the exchange’s claims. Binance Info is a useful tool, but shouldn’t be the only place investors go to do their research.
What is Binance Info?
Founded in China just over a year ago, Binance rode the cryptocurrency market’s meteoric rise to become the world’s largest cryptocurrency exchange by trading volume. It also navigated the market’s collapse and the Chinese government’s turn against crypto exchanges. Now based in Malta, Binance has begun to position itself as a one-stop-shop for the cryptocurrency ecosystem.
Besides its exchange, Binance fosters innovative startups through its Binance Labs and Binance Launchpad services. Binance Labs is an incubator that gives promising projects the resources they need to get off the ground. Projects ready for their initial coin offering (ICO) can use Binance Launchpad to tap into the exchange’s networks.
Binance also helps crypto investors develop their own investment strategies. For those new to the crypto arena, Binance Academy guides users through the ins-and-outs of crypto trading.
Binance Info is the latest addition to these services — a go-to source for information about all the assets listed on the exchange. Prior to the September launch, Binance’s staff compiled information on more than 1,400 coins and tokens. Now that it’s live, Binance Info is a community-produced service. Any member of the Binance community can add information to a token’s Binance Info page.
What’s in Binance Info?
The information portal has three general sources of information: the community, Binance itself and third-party analysts.
Each coin’s information page includes a chart that displays a price index from a basket of exchanges. You also have the option to just show trends on the Binance Exchange. General details about the coin include links to its website, white paper and block explorer. All of this is automatically populated by the Binance system.
Members of the community can edit the content on each coin’s detail page. This includes modifying the description, updated key facts or posting news articles.
Binance moderates the quality of community-provided data in two ways. First, it charges a nominal fee, payable in the exchange’s BNB utility token, to discourage spammers. Binance staffers also review each submission to maintain quality.
Third Party Research Reports
Binance’s goal is to create “the most comprehensive compilation of third-party rating reports on blockchain projects that’s available.” The exchange claims to have compiled more than 1,000 research reports from 50 rating agencies. After reviewing the past 6 months of activity on Binance Info, CoinIQ found more than 800 reports. However, those reports came from only 18 rating agencies.
Binance Info provides several paths you can follow to find reports. The main Binance Info page has two banners. The first are featured cryptocurrencies. The second banner features the latest reports from the third-party firms. Clicking on the “More” button will take you to Binance’s full listing of research reports.
From there, you can apply various sorting and filtering options to narrow your search. The sort option lets you arrange reports by score, by date posted or with Binance’s unexplained default setting. Note that each listing seems to have two ratings, which may not match:
The rating beneath the report title comes from the rating agency and reflects its opinion of that specific cryptocurrency. The star rating to the right side is Binance’s aggregation of all the analyst reviews. Binance does not explain how its algorithm calculates the aggregate score, so the star rating may not be that useful.
From the coin detail page
Since you’re more likely to be looking for information on a specific cryptocurrency, an easier way to find research reports is from that coin’s detail page. Between the price chart and the token details section, you’ll find a banner with the most recent third-party reports.
Choosing the “More” button will open a list of all of the available reports. In the case of Havven, Binance Info has reports from four different rating agencies. Only the largest cryptocurrencies have more than that, even though you don’t need an analyst’s report to buy litecoin. Over time, more reports will appear for the smaller tokens, which will make the sorting and filtering tools more useful.
Selecting one of the reports brings up the report detail page. You get the rating agency’s score for that cryptocurrency, an abstract summarizing the full report and a link to the full report. Some reporting firms also post videos of analysts summarizing their reports.
Below that, you get a banner with related reports as well as an explanation of the rating agency’s scoring system. Note that the rating systems vary from firm to firm, so comparisons aren’t always easy. Some give simple number scores. Others use letter grades similar to equities reports. And a few use complicated weighted formulas to create the impression that the report’s based on science.
Are the reports any good?
The short answer is “maybe”. The longer answer is “yes, as long as you put effort into interpreting them.” Binance does not screen the reports for quality or accuracy. The community can’t rate the quality of reports either. As a result, it’s up to you to decide which reports are useful.
CoinIQ sampled reports from the 18 agencies active over the past 6 months and grouped together the good, the bad and the pretty. One thing to keep in mind, though, is that some agencies donate a mix of brief and detailed reports to Binance Info.
Rating agencies like Picolo Research, ICO Ratings, Token Insight, Crypto Briefing and DP Rating put more effort into their reports than most of the agencies. Rather than just summarizing a website and white paper, these agencies supplement their report with market research and deeper analysis. In addition, the formatting and writing quality are more professional.
Picolo Research’s 8-page report on Havven, for example, starts with a summary of the project’s background. It then evaluates the project’s strengths and weaknesses as well as the opportunities and threats the project faces. This SWOT analysis is followed by an overall analysis to explain Picolo’s rating.
Although not as polished as Picolo’s, the 19-page report from ICO Ratings provides a little more information. ICO Ratings evaluates the quality of Havven’s GitHub repository and provides more market context for the project’s use-case. Besides looking at the potential opportunity for stablecoins, for example, ICO Ratings evaluates Havven’s competition as an alternative to Tether.
Reports from ICO Crunch, ICO Bench, Coindaily, Token Tops and One Top may not be worth opening. They do little more than summarize the project’s website. Any analysis they do provide is superficial at best. At times, the report is too poorly formatted to communicate useful information.
ICO Bench isn’t any better. It provides a one-paragraph summary of the Havven project and an overall score before listing comments from its own third-party analysts. Bonnie Normile, for example, gave Havven perfect marks with the insightful analysis “NEEDED!!!”
Blokt, Shulian Ratings, GyroRating, Crush Crypto, ICO Scoring, Token Master and Rency produce pretty-looking reports that don’t have much substance. Any one of these reports provides an at-a-glance summary of a project that may be useful as you start your research but won’t have any lasting value.
Instead of relying on one report, compare several such as the Bitcoin Gold reports from Blokt and Shulian Ratings. This might help you understand the range of opinions about a particular project. By identifying topics where the analysts disagree, you can flag issues that need further research.
Start With Binance Info But Don’t Stop
Binance Info is convenient. You get quick snapshots of price trends, whatever news the community has curated and several third-party reports. As long as you take the time to find the quality reports, Binance Info is a good place to start.
Take reports with a grain of salt
But don’t make Binance Info the last place you do your research. Its database does not have all of the high-quality reports that are out there. Before you make your investment decisions, make sure you exhaust all your options.
Even then, you need to be careful. When CoinIQ looked at ICO listing sites, we found that many had conflicts of interest. Not only would they charge ICO projects for prominent placement on their sites, but they would also give paying projects better ratings.
Reputable analysts like Smith & Crown and Picolo Research, on the other hand, fully disclose any commercial relationship they have with the firms they analyze. You can also turn to community sites like ConcourseQ for perspective from fellow crypto investors. Check out CoinIQ’s list of reputable ICO analysts for other options.
Compare and contrast
The advantage of getting research reports from a wide range of firms is that you can compare their content. If half a dozen reputable research firms provide the same information and give the token similar ratings, then you can have some confidence in their analysis. Reports that provide different or conflicting information, on the other hand, indicate that something’s not right.
Do your own research
More importantly, you need to compare the reports to the results of your own research. A prominent token offering will get widespread coverage. However, you may not find many reports on one of the more obscure ICOs.
For more tips, check out CoinIQ’s article on doing your own research.
Look for professionalism
A quick glance at a project’s website and marketing materials can tell you a lot. A professionally-produced website that provides information rather than buzzwords shows that a project respects potential investors. On the other hand, a website full of stock photography and vague, poorly-written content is evidence that the team does not pay attention to detail.
Know who you’re dealing with
Before you hand your crypto to someone, you want to know they are trustworthy. Since you can’t meet a project’s team in person, you need to rely on research. Make sure the key team members and advisors use real names. Check their LinkedIn profiles and other social media accounts to see if they actually work on the project.
You also want to know whether the people developing the project have the expertise to get things done. That doesn’t just mean coding skills. Experience in the industry they are trying to disrupt is even more important. You also want to see people with experience running successful startups.
Does it even make sense?
The icon of the 1990s dotcom bubble was pets.com, which thought it could make money shipping 40-pound bags of dog food around the country. The same thing happens in the crypto world where “blockchain” can seem to be the solution for everything.
Study the white paper, roadmaps and anything else the project publishes about its approach to the business. Look for functioning code and a realistic minimum viable product. And make sure that the coin distribution from the pre-sale through the ICO isn’t a complete money grab.
Binance provides a useful service to its customers. By providing a portal for research reports on the coins listed on the exchange, the Binance Info site serves as a good starting point for investors’ research.
One missing element is a rating system for the rating agencies. Only a handful of agencies provide in-depth analysis in their reports. There’s no way to separate the signal from the noise without opening each report. A community-based rating system would make Binance Info easier to use.