Cryptocurrency has become a currency that many people are hesitant to take part in simply because of the lack of backing that it has. For others, however, the risk is well worth it. This is all about to change, however. A major US Rating agency is now set to issue ratings for both Bitcoin and other cryptocurrencies.
What is a Weiss Rating?
Weiss Ratings, a highly trusted and independent rating agency in the US, has stated that on the 24th of January their ratings of cryptocurrencies will be released to the public. Though these letter grades will include the major trader, Bitcoin, they will not be limited to the cryptocurrency giant and will include other, smaller, companies as well. They will issue grades for Bitcoin, Cardano, NEM, Litecoin, Monero Stellar, EOS, IOTA, TRON, Dash, Bitcoin Gold, and NEO along with dozens of other companies as well.
Weiss is a fully independent grader that never accepts money from any of the companies that they grade which makes it possible for them to release a fully impartial grade. Weiss namely works with financial institutions and was founded in 1971. They currently grade around 55,000 different institutions each year. So what is Weiss looking for when they assign these prestigious grades?
How Will Grades be Calculated?
Weiss stated that they will assign letter grades to the cryptocurrency companies that they are grading by taking a look at several different data points. They will discuss the technology of each coin, overall usage, as well as different trading patterns to establish a well-rounded score. Grading is set to do wonders for the cryptocurrency market by first and foremost giving those hesitant about investing a bit more information about the currencies before they take part in trading.
What Does This Mean for the Market?
It will help lower perceived risk and will also open up the market to those investors and fund managers that are only allowed to take part in a specific type of trading. Some of the largest factors holding back investors are their inability to gauge whether or not Bitcoin and similar cryptocurrency are safe to invest in. As with many other trading and banking institutions, those that are hesitant to invest are far more likely to take the so-called plunge if they do have some sort of information on their side that they can use to justify their purchase of any investment.
For some, even this type of trusted grading system is not going to be enough to make them invest in this type of currency. Others are still going to want to take a few more precautions. With Bitcoin and other cryptocurrencies growing at such an alarming rate, there are sure to be more safeguards put in place in the next few months and even years as governments take interest in making sure that this type of currency is safe for investors and safe for the market as well.
Only time will tell what is going to be put in place to keep cryptocurrency investors safe, but it looks like change is coming.