Weiss Crypto Ratings
Weiss Crypto Ratings are crypto asset ratings designed for all stakeholders in the cryptocurrency space, including individual investors who are willing to take significant risks as well as users and others. The ratings are designed to help identify the crypto assets with the best short-term profit potential along with the best chances of surviving and succeeding in the long term.
Each grade is based on a groundbreaking model that considers thousands of data points on each crypto’s technology, adoption, investment risk, and market momentum.
Weiss Ratings’ overall goal is to help the public avoid both the hype and the fear — to invest and do business with more confidence and, at the same time, more awareness of the possible dangers. Each cryptocurrency is evaluated with five basic steps:
Step 1. Collection of current data on each currency’s technology, adoption, risk and momentum.
Step 2. Proprietary formulas that convert the data into comparable ratios.
Step 3. Four sub-models that aggregate the ratios to measure key factors and features considered critical to the potential success or failure of investments in each cryptocurrency.
Step 4. Aggregation of the above into two separate grades: (1) the Tech/Adoption Grade which evaluates the long-term potential of each cryptocurrency and (2) a shorter-term Market Performance Grade based on market price patterns.
Step 5. A complex model that aggregates the Tech/Adoption Grade and Market Performance Grade to produce the overall Weiss Crypto Rating.
Below is a broad description of the four sub-models cited in Step 3 above.
Our Technology Model evaluates each cryptocurrency’s potential to achieve a variety of goals, including high transaction speeds and other scaling solutions, decentralization, energy efficiency, sophistication of monetary policy, governance capabilities, flexibility to upgrade, and others.
Our Adoption Model evaluates each cryptocurrency’s real-world network security, network capacity, speed, scalability, market penetration, decentralization, developer participation, public acceptance, plus other key factors.
Our Risk Model is based on a composite of sub-models that measure (a) relative and absolute price fluctuations over multiple time frames, (b) declines from peak to trough in terms of frequency and magnitude, (c) market bias, and other factors.
Our Momentum Model is based on a composite of sub-models that evaluate (a) returns compared to moving averages, (b) absolute returns compared to a benchmark, (c) smoothed returns compared to a benchmark, and other factors.
Crypto ratings definitions:
A Excellent. This crypto merits an excellent overall score due to a combination of (1) adoption, denoting real-world activity; (2) technology, representing the potential to achieve critical goals; and (3) market performance, based on price momentum vs. risk. Although even the best cryptos can also fall in down markets, investors may interpret our “A” rating as “strong buy.”
B Good. This crypto merits a good overall score due to a combination of (1) adoption, denoting real-world activity; (2) technology, representing the potential to achieve critical goals; and (3) market performance, based on price momentum vs. risk. Although even the best cryptos can fall in down markets, investors may interpret our “B” rating as “buy.”
C Fair. This crypto merits a fair or mixed overall score due to a combination of (1) adoption, denoting real-world activity; (2) technology, representing the potential to achieve critical goals; and (3) market performance, based on price momentum vs. risk. Although the price of almost any crypto can be volatile, investors may interpret our “C” rating as “hold” or “avoid.”
D Weak. This crypto merits a weak overall score due to a combination of (1) adoption, denoting real-world activity; (2) technology, representing the potential to achieve critical goals; and (3) market performance, based on price momentum vs. risk. Although even the weakest cryptos can go up in rising markets, investors may interpret our “D” rating as “sell.”
E Very weak. This crypto merits a very weak overall score due to a combination of (1) adoption, denoting real-world activity; (2) technology, representing the potential to achieve critical goals; and (3) market performance, based on price momentum vs. risk. Although even the weakest cryptos can go up in rising markets, investors may interpret our E rating as a “sell.”
+ The plus sign is an indication that the crypto is in the upper third of the letter grade.
- The minus sign is an indication that the crypto is in the lower third of the letter grade.
S Stablecoin. A stablecoin is a cryptocurrency designed to maintain a stable price tied to an external reference asset, like the US dollar, gold, or even another cryptocurrency. This "peg" aims to minimize volatility, unlike traditional cryptocurrencies known for their price swings.
U Unrated. This crypto is not rated due to insufficient data or anomalies that call into question the accuracy of the information available. However, investors may refer to this crypto’s market performance grade.
