Coinbase is rolling out new tools To help entry-level crypto users easily understand the trend of things with seasoned traders.
The new suite of signaling tools was made available as announced by the exchange on Wednesday. One such tool broadcasts the activity of Coinbase’s top traders.
“Through trading over the last 24 hours, the tool holder activity signal was determined by the percentage of Coinbase customers who has large balances of an asset (top 10%) who have net increased (bought) or decreased (sold) their positions in that asset,” reported by an official.
“Indications show that it is updated approximately every 2 hours.”
Speaking further, excluding those set up by institutions, top holder activity would be aggregated from all individual Coinbase accounts across the exchange.
The San Francisco-based company is set to roll out other data tools which will help other retail users make more informed decisions and this a way of looking beyond sharing metrics on Coinbase power users.
The tool will also enable Coinbase customers to see the median number of days an asset is held by traders on the exchange before being sold or moved to another address.
Thirdly is the tool that gauges relative price correlations to other crypto assets and also the popularity of assets on Coinbase as well.
According to Coinbase, starting from now, all these exclusive data tools are available to any user for free.
On the aims and objectives behind this project, the Coinbase spokesperson says:
“ We want especially those new to crypto and for individual investors to know trading signals to help first-time investors build the right portfolio to suit their investment goals and we also hope these new signals will encourage more informed management of a diversified crypto portfolio.”
Coinbase senior engineer Will Drevo says; “Coinbase’s top crypto accounts have a tendency to buy rather than sell their portfolio positions.” This is his statement after some early analysis with these tools were done.
Drevo also wrote in another blog post:
“Historically, when top holders are either unusually bullish or bearish this has been indicative of changing market conditions, but not always.”
“It is not always beneficial to traders as in leveraging a strictly-based investment and as such, should not be taken directly as investment advice or strategy”, says Drevo.
Rather, it’s much better to encourage users to create and manage their own crypto strategy based on a user’s own needs, financial means and risk tolerance instead of assuming how they should do. It’s better to consult a financial professional when in doubt , Drevo writes.
Founded in 2012, after raising $300 million in venture capital. Then, $8 billion valuation late last year.
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