Binance Info 2.0 ratings site shows the trouble with crypto reviews
Binance's third-party crypto review hub is a solidly zero-star affair so far.
Binance is the world's largest cryptocurrency exchange by volume, so its word can carry a lot of weight, especially as far as cryptocurrency project viability judgments are concerned. But it still wants to become a complete blockchain ecosystem, rather than just an exchange, so it has to get a bit creative and rely on third parties to pass around these kinds of judgments.
"Info 2.0 may be the most comprehensive compilation of third-party rating reports on blockchain projects that's available," it said in its announcement. "For this upgrade, we’ve compiled resources from more than 50 rating agencies, capital and media across the globe to build a library of nearly 1,000 reports."
"In building an expansive third-party rating platform based on well-researched reports, our goal is to help users learn more about the blockchain projects in our ecosystem," Binance said.
Hot or not
Binance Info 2.0 is a bit of a trainwreck with less academic rigour than a YouTube comments section.
You only need to look as far as some of the more polarising projects for a sense of how low the bar is for Binance Info reviewers.
For example, Binance Info 2.0's so-called experts at Coindaily gave EOS a solid A rating of 4.5 stars because
they're obviously heavily invested they couldn't discern any downsides to EOS whatsoever except "a certain degree of centralisation", and then gave TRON a 1-star review because "it can be regarded as the younger brother of EOS" and "the market for public blockchains is very competitive and EOS is the most powerful competitor."
Regardless of how one feels about either project, having reviewers who grade one coin based on a questionable rating they gave a completely separate project makes the entire scoring system pointless.
The haphazard ratings scheme doesn't help either. Each reviewer has their own way of marking coins, which are then crudely mashed into a rating out of 5 stars.
For example, Binance 2.0 is of three minds about Polymath, each of which uses completely different metrics.
- If you like Polymath, you'll probably want to trust the 4.5-star review that gives it a very high score, citing a strong-seeming business model but lingering doubts.
- If you don't like it, you might prefer the B rating review, which translates to an unfavourable 2.5 stars, citing the unpopularity of its GitHub repository.
- If you're ambivalent, you can hedge with the very positive and detailed review, which gives it a solid 8/10 score, which is then translated to a middling 3.5 stars.
There's little rhyme, reason or consistency to the actual grades. Binance Info can probably afford to command a bit more effort from the exposure-hungry self-described experts which will spawn on the platform, so it would probably make sense to enforce a more consistent and useful ratings system.
The sheer inconsistency from one review to another makes it extremely difficult to get any useful comparative insights, but at least you know it's impartial... maybe.
To be fair, BNB does present a fairly compelling value proposition, but it's still not a great look.
Bitcoin, of course, is one of the most consistently high-rated coins on the platform. But no one's seriously reviewing bitcoin's technical fundamentals anymore, so the bitcoin review page is more like a shrine to leave offerings at, than a serious review page.
The reviews of Tether, another polarising project, are also telling.
"The price support of USDT fundamentally comes from its full dollar reserve, which has NOT been convincingly proven for a very long time," said one reviewer. They seem to think Tether's undeniable shadiness is a cause for concern, so only gave it either a pretty bad 2.5 stars or a pretty good high B grade depending on how you look at it.
Another reviewer was much more upbeat about Tether. The main downside they mentioned was that "there are risks of default by the issuer, being closed by the government and various insider manipulations." Then in literally the exact next sentence after the words "insider manipulations" they described Tether's crossover episode with Bitfinex (which is a statistically likely centrepiece of Tether's alleged manipulations) as a huge advantage, saying "the USDT team is very strong in both resources and capabilities because they have their own exchange." 4 stars and a strong A- rating from that confused reviewer.
Some of the concrete information such as prices might be useful, but as the well-informed rating system it intends to be, Info 2.0 drops the ball. The cursory star ratings are inconsistent to the point of uselessness, while a more detailed look at some of the reviews reveals a terrifying degree of misinformation and shilling, although these might thankfully be in the minority.
Binance Info 2.0 needs to slow down, exercise a bit of quality control over which "experts" it lets on the site, and get all its reviewers to use the same metrics if it wants to be the information hub it envisions.
Setting a clear template and scoring system for its third party experts would be a solid step in the right direction.
Disclosure: At the time of writing the author holds ETH, IOTA, ICX, VET, XLM, BTC, ADA