Crypto assets are revolutionizing the way new ventures raise funds. Their biggest hurdle, rating the reliability and trustworthiness of crypto assets or any form of tokens, will soon be history with the launch of Crypto Asset Rating Inc. The US-based independent structured rating agency is introducing an objective and impartial rating framework and algorithm, like those of S&P or Moody’s, which in a short time has earned the confidence of top Wall Street executives.
Crypto Asset Rating (CAR) is an Independent Structured Rating Agency and wants to make investing in crypto assets as safe and reliable as traditional investments. The agency has created a well-defined rating framework based on 125+ quantitative and qualitative parameters across 15 categories. Periodically updated with backtesting results, the CAR ecosystem will give peace of mind to retail investors by helping them to make informed decisions and allow fundraisers to distinguish their projects.
The impetus to launch the rating agency derives from the handicaps in the ICO and crypto asset ecosystem, where it is lucrative to raise funds through ICOs fairly quickly with direct access to investors i.e. no middlemen, but the last few years have also revealed serious weaknesses.
The year 2018 was a watershed moment for ICOs, with an average of 5-6 ICOs launched each day. This led to much confusion among the investors due to the sheer volume, and the inability of retail investors to sift through projects to identify the best or most promising ones. The absence of appropriate regulations and trusted intermediaries went along with cases of either fraud or fruitless projects.
“As a rating agency, our aim is to bring transparency in the crypto market. Our rating system is an objective analysis of the underlying business (along with various other factors), and hence a fraudulent ICO with a frivolous or non-existent underlying business gets filtered out and can help investors separate the wheat from the chaff,” said a Pramod Attarde, CEO of Crypto Asset Rating Inc.
The ratings on CAR Platform are generated through scores from a team of internal (junior, senior and lead analysts), and external analysts. Scores are generated in four risk categories: business, financial, legal and technological risks. The CAR rating engine aggregates the scores to determine the final rating. The lead analyst reviews the rating and passes it on to the final review committee. The final ratings and parameter scores are then stored as smart contracts on the blockchain to allow for transparent audits.
· Unbiased and objective crypto asset rating system
· Overall indicator of the quality of tokens and ICOs
· Strong proprietary rating algorithm
· Robust governance structure
· Periodic updates on ratings
The crypto asset rating by CAR represents an objective opinion on the investment quality of the token and/or the issuer’s general investment attractiveness. The ratings do not constitute recommendations for investment, nor are they a guarantee for no defaults.
Linked to the rating ecosystem is the second product of CAR – the Crypto Business World (CBW)platform. CBW will feature expert and professional content for the crypto market created by internal and external analysts. The content will be diverse, comprising articles, news, reports, interviews, videos, podcasts, case studies, webinars and more.
The CAR ecosystem will benefit the entire crypto market by introducing the elements of reliability and trust. Fundraisers can get their ICOs rated, and reach out to investors, many of whom are subscribers to the CAR platform. Investors can find their way through hundreds of ICOs, identify suitable investment opportunities, and avoid fraudulent or non-existing businesses.
The Beta version of the CAR Platform (CARP) is currently ready along with the rating engine, smart contract APIs and analyst dashboards, and the Crypto Business World is also live.