Weiss Ratings just published the first digital currency grades released by any rating agency in the world. Established in 1971, Weiss Ratings is one of the leading financial institution rating agencies in the U.S. Weiss Ratings rates 55,000 traditional institutions and investments and announced an intent to rate various digital currencies earlier in January 2018. Since the announcement, investors waited with anticipation for the ratings of various digital currencies. Now, in a world first, the site’s ratings of 74 digital currencies were made available in a recently released document. The Weiss Cryptocurrency ratings make use of a letter grade, with ‘A’ being ‘excellent’ and ‘E’ meaning ‘very weak.’ Perhaps most notably, Bitcoin, the world’s first and most popular digital currency, earned a ‘C+’ letter grade, indicating that it’s a ‘fair’ investment.
These gradings are based on a set of four criteria: the risk index, the reward index, the technology index, and the fundamentals index.The risk index analyzes the potential risk and downside of the digital currency. Similar to any stock or bond, it looks at the level of risk taken by investors.Reward index, on the other hand, considers the potential for growth and opportunity within the digital currency. This means the chances the price will increase, stabilize, and otherwise provide a return for investors. The technology index looks at the underlying technology behind each digital currency. It analyzes the framework that the digital currency uses, and identifies if it believes the technology is ‘future-proof’. The focus on technology is not unique to digital currencies but is especially necessary given that digital currencies are fully reliant on their technology stack. This unique aspect gave way to the importance of white papers released by digital currency creators. On the business side, the fundamentals index considers how each digital currency could be used in the real world. This is perhaps the most obvious criteria from a retail investor perspective because it helps individual investors get a sense of what the digital currency is good for.
Included in the rating list are other prominent currencies like Ethereum, which scored the publication’s highest ranking of a B (meaning ‘good’) alongside fellow digital currency EOS. Big winners on the list include Steem, Neo and Cardano, which were the only currencies of the 74 rated to score a B-, trailing behind Ethereum and EOS. Bitcoin is joined in its C+ rating by both Dash and Litecoin. Monero and Ripple, on the other hand, each scored a C, while Bitcoin Cash earned a C-“We have built a computer model that looks at cryptocurrencies from many different angles and proves a rational, rigorous and reasoned research that investors need so desperately in this space,” said Dr. Martin Weiss, founder of Weiss Ratings.“Many cryptocurrencies are murky, overhyped and vulnerable to crashes,” he added. “The market desperately needs the clarity that only robust, impartial ratings can provide.”With the highly anticipated ratings now published, it is unclear what effect this publication will have on the market. What is clear, however, is that many enthusiasts may be surprised to see how their favourite currencies have scored in terms of risk, reward, technological potential, and fundamental use. _Update: Coinsquare confirmed via telephone with Weiss Ratings that the ratings were released today (January 24th, 2018). Weiss further clarified, going against rumours, that their site was not hacked. Weiss also confirmed they own https://weisscryptocurrencyratings.com/ and their statement announcing the ratings is accurate. Image credit: Weiss Ratings
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