Information as of October 8, 2018

This report was created by:

  • Professor Dmitrii Kornilov, Doctor of Economics, Member of the Russian Academy of Natural Sciences, and Leading Analyst at ICOBox;
  • Dima Zaitsev, PhD in Economics, Head of International Public Relations and Business Analytics Department Chief at ICOBox;
  • Nick Evdokimov, Co-Founder of ICOBox;
  • Anar Babaev, Co-Founder of ICOBox;
  • Daria Generalova, Co-Founder of ICOBox

This report presents data on cryptocurrency market changes during 2018. Special emphasis has been placed on an analysis of the changes that took place last week (October 1-7, 2018).

1. General cryptocurrency and digital assets market analysis. Market trends

1.1 General cryptocurrency and digital assets market analysis

Table 1.1. Trends in capitalization of the cryptocurrency market and main cryptocurrencies from January 1, 2018, to October 7, 2018*

Parameter 1-Jan-18 1-Apr-18 QoQ, % 1-July-18 QoQ, % 1-Oct-18 QoQ, % 7-Oct-18 DoD, %
1 Total market capitalization, USD billion 612.9 263.9 -56.9% 257.7 -2.3% 223.3 -13.3% 217.9 -2.4%
2 Altcoin market capitalization, USD billion 376.2 145.2 -61.4% 147.9 1.9% 108.8 -26.4% 103.8 -4.6%
Altcoin dominance, % 61.4% 55.0% 57.4% 48.7% 48.7%
3 Bitcoin price, $ 14 112.2 7 003.1 -50.4% 6 411.7 -8.4% 6 619.9 3.2% 6 590.7 -0.4%
Bitcoin market capitalization, USD billion 236.7 118.7 -49.9% 109.8 -7.5% 114.5 4.3% 114.1 -0.4%
Bitcoin dominance, % 38.6% 45.0% 42.6% 51.3% 51.3%
4 Ethereum price, $ 755.8 397.3 -47.4% 455.2 14.6% 233.2 -48.8% 225.4 -3.3%
Ethereum market capitalization, USD billion 73.1 39.1 -46.4% 45.7 16.8% 23.9 -47.8% 23.1 -3.2%
Ethereum dominance, % 11.9% 14.8% 17.7% 10.7% 10.7%
5 Bitcoin Cash price, $ 2 534.8 688.0 -72.9% 749.2 8.9% 531.6 -29.0% 509.6 -4.1%
Bitcoin Cash market capitalization, USD billion 42.8 11.7 -72.6% 12.9 9.9% 9.2 -28.4% 8.9 -4.1%
Bitcoin Cash dominance, % 7.0% 4.4% 5.0% 4.1% 4.1%
6 Litecoin price, $ 231.7 116.9 -49.5% 81.5 -30.3% 61.1 -25.0% 57.9 -5.2%
Litecoin market capitalization, USD billion 12.6 6.5 -48.3% 4.7 -28.6% 3.6 -23.3% 3.4 -5.0%
Litecoin dominance, % 2.1% 2.5% 1.8% 1.6% 1.6%
7 Volume (24h) 4 crypto, USD billion 15.7 6.4 -59.2% 7.1 11.3% 7.5 4.7% 5.7 -23.5%
Market cap 4 crypto, USD billion 441.6 189.7 -57.0% 186.7 -1.6% 170.9 -8.5% 165.6 -3.1%
ZAK-4 Crypto index** 3.6% 3.4% 3.8% 4.4% 3.4%
4 crypto dominance, % 72.0% 71.9% 72.4% 76.5% 76.5%
8 Volume (24h) 8 crypto, USD billion 17.2 7.2 -58.0% 8.2 14.1% 8.7 5.9% 6.7 -22.8%
Market cap 8 crypto, USD billion 488.6 208.7 -57.3% 205.9 -1.4% 186.7 -9.3% 180.9 -3.1%
ZAK-8 Crypto index*** 3.5% 3.5% 4.0% 4.7% 3.7%
8 crypto dominance, % 79.7% 79.1% 79.9% 83.6% 83.6%

* Data as of October 7, 2018 (all figures calculated at 03:00 UTC)
** Since December 1, 2017, the ZAK-4 index has been calculated using the cryptocurrencies Bitcoin, Ethereum, Ripple, and Bitcoin Cash
*** When calculating the ZAK-8 index, the cryptocurrencies with the largest capitalization (not including Tether) are used. At present (October 7, 2018), the cryptocurrencies Bitcoin, Ethereum, Ripple, Bitcoin Cash, Litecoin, Stellar, EOS, and Cardano are used to calculate the ZAK-8 index.
**** This report uses the data of ICOBox, ICOBox Blockchain Research Center (IBRC), and coinmarketcap.com

Cryptocurrency market capitalization decreased over the analyzed period (October 1-7, 2018), and as of 03:00 UTC equaled $217.9 billion (see Table 1.1). The dominance of the four and eight largest cryptocurrencies as at 03:00 UTC on October 7, 2018, equaled 76.7% and 83.6%, respectively, while bitcoin dominance equaled 51.3%. (see Table 1.1).

During the period from October 1-7, 2018, cryptocurrency market capitalization fluctuated from $213.9 billion (min) to $224.6 billion (max) (Fig. 1a), i.e. within a range of $10.7 billion. For its part, bitcoin capitalization fluctuated from $111.6 billion (min) to $115.1 billion (max), i.e. within a range of $3.5 billion.

Figure 1a. Cryptocurrency market capitalization since October 1, 2018

Data source: coinmarketcap.com

Figure 1b shows bitcoin capitalization (red line) superimposed on cryptocurrency market capitalization (blue line). The high correlation between the indicators is obvious. This synchronicity has been seen since at least the start of the year, but at the same time bitcoin dominance has grown from 38.6% to 51.3%. The increase in bitcoin dominance is most noticeable since the start of May.

Figure 1b. Capitalization of the cryptocurrency market (blue) and bitcoin (red) since October 1, 2018

Data source: coinmarketcap.com

The volatility of bitcoin has fallen markedly over the past month, equaling around $200 over the past week, i.e. its price changed from $6,454 to $6,653 (Fig. 1c)

Figure 1c. Bitcoin price since October 1, 2018

Data source: coinmarketcap.com

On October 3 an updated version of Bitcoin Core 0.17.0 of the most popular bitcoin client was presented on GitHub and contains a number of new functions (the formulae for calculating transaction fees have been improved, the ability to create special “view only” wallets has appeared, the framework for partially signed bitcoin transactions (PSBT) has been established, etc.), transaction speed has been increased, and bugs have been fixed. In particular, pursuant to information from CoinDesk it was discovered on October 2 that the recently eliminated bug CVE-2018-1744 had previously been used to issue 235 million Pigeoncoins (PGN), which amounts to $15,000.

The rise and fall of cryptocurrency prices over the past seven days (October 1-7, 2018)

Last week’s leaders from among the top 500 cryptocurrencies by capitalization that showed the growth of more than 100% were the projects Swarm (+219.57%), Digitex Futures (+137.51%), and ARBITRAGE (+108.25%). The growth of MobileGo (+81%), IHT Real Estate Protocol (+74.82%), DAPS Token (+72.75%), DATx (+72%), MediBloc [ERC20] (+63.3%), Noah Coin (+60.65%), and TomoChain (+59.75%) should also be noted.

During the period from October 1-7, 2018, the change in the prices of cryptocurrencies in the top 500 ranged from -84% (Ubex) to +2,137.86% (Rupee). The Rupee price increased by more than 2,100% over the week, but this growth cannot be called anything other than speculative. This cryptocurrency has practically no trading volume, so any purchase on the exchange, even for $200, can lead to a sharp increase in the price. Ubex, on the other hand, showed the worst results over the week, with its price falling by 84%. The Ubex ICO, which collected its hard cap of 28,800 ETH, was completed on September 30. The price of one UBEX token during the token sale was 0.00001 ETH (without taking into account bonuses, which reached 20%). The token price jumped approximately tenfold immediately after the completion of the ICO, and then fell back to its starting price of 0.00001 ETH over the course of three days, and then tumbled lower to 0.0000087 ETH. The fall took place against the backdrop of decreasing 24-hour trading volumes from $2.7 million to $0.6 million over the week.

The price of 245 cryptocurrencies and digital assets from the top 500 showed growth, including 41 from the top 100.

Over the past week the number of cryptocurrencies with a capitalization of more than $1 billion remained the same at 16, but the price of all of them fell except for TRON (+9.11%), Binance Coin (+4.98%), IOTA (+0.03%), and Tether (the price of which is tied to the US dollar).

The coins and tokens from the top 100 that demonstrated the largest price growth are given in Fig. 2.

Biggest gainers and losers over the week (October 1-7, 2018)

The prices of some cryptocurrencies may fluctuate from -50% to +50% over the course of a single day. Therefore, when analyzing cryptocurrency price trends, it is advisable to use their average daily amounts on various cryptoexchanges.

Below we consider the 10 cryptocurrencies that demonstrated the most significant change in price over the past week (Fig. 2-3). In this regard, only those coins and tokens included in the top 100 (Fig. 2, Fig. 3) by market capitalization were considered[1].

Figure 2. Largest growth in prices over the past week

This report uses the data of ICOBox, ICOBox Blockchain Research Center (IBRC), and coinmarketcap.com
The change in price was calculated based on average daily data

Tables 1.2 and 1.3 show the possible factors or events that might have influenced the fluctuation in prices for certain cryptocurrencies. Table 1.4 shows the possible factors or events that might have influenced the cryptocurrency market in general.

Table 1.2. Factors or events that might have led to a growth in cryptocurrency prices over the past week

Coins and tokens Symbol Price growth over the week, % Average price in $ on October 7, 2018 Market capitalization, USD billion Factors or events that might have led to a growth in cryptocurrency prices over the past week
1 Digitex Futures DGTX 137.51% $0.084362 0.06 The main reason for the growth in Digitex Futures was the news on the forthcoming launch of the main product of the project, namely the launch of the futures exchange (Twitter.com).

Noah Coin also appreciated on the back of good news on the progress being made in project development (Twitter.com).

The growth in the price of Maker may have been due to the efforts of its developers at recent conferences and meetups, where the product was presented to potential interested parties (Twitter.com).

Siacoin was created to serve as a unit of account for the Sia platform, which offers users a decentralized repository for the storage of information.

Aurora is a collection of Ethereum applications and protocols, which together form a decentralized banking and financial platform.

Nebulas is like Google for all projects that work with blockchain and have their own decentralized applications.

The DigixDAO cryptocurrency is a site created on Ethereum blockchain for the tokenization of real assets, in this case gold.

Theta Token is the key instrument of a platform for promotion of video materials. The THETA token will be used on the platform to give incentives to users.

With the help of CyberMiles, users can sell their own products, thereby creating their own trading platform on top of CyberMiles.

The Wanchain cryptocurrency is the digital token of a decentralized platform concerned mainly with the provision of banking services such as: currency exchange, lending, and performance of transactions.

2 Noah Coin NOAH 60.65% $0.001930 0.06
3 Maker MKR 28.82% $630.42 0.46
4 Siacoin SC 21.11% $0.007335 0.27
5 Aurora AOA 19.62% $0.026408 0.09
6 Nebulas NAS 18.24% $1.69 0.08
7 DigixDAO DGD 16.79% $44.32 0.09
8 Theta Token THETA 13.36% $0.098796 0.07
9 CyberMiles CMT 12.49% $0.113948 0.08
10 Wanchain WAN 11.29% $1.04 0.11

 

A depreciation in price was seen last week for 255 coins and tokens from the top 500 cryptocurrencies and digital assets by capitalization. The ten crypto assets from the top 100 that experienced the most noticeable drops in price are shown in Fig. 3 and Table 1.3.

Figure 3. Largest fall in prices over the past week

Table 1.3. Factors or events that might have led to a fall in cryptocurrency prices over the past week

Coins and tokens Symbol Fall in price over the week, % Average price in $ on October 7, 2018 Market capitalization, USD billion Factors or events that might have led to a fall in cryptocurrency prices over the past week
1 XRP XRP -17.93% $0.478164 19.10 XRP or Ripple is the third largest cryptocurrency by capitalization and gives banks the ability to perform quick transfers between accounts. This week it depreciated by 18% due to a so-called phase of downward adjustment that started after previous skyrocketing growth of more than 100%.

One of the reasons that Monacoin fell by 15% this week was the mass sell-off of this coin after the hacker attack a week earlier (dailyhodl.com).

The RChain cryptocurrency is the digital token of a platform of the same name, which was designed for the development of blockchain-based decentralized applications.

Eternal Token (XET) is being developed for exchange with various currencies on global exchanges.

The ReddCoin cryptocurrency is a cryptocurrency based on Litecoin blockchain for social networks that will be installed in all social networks through seamless integration.

The MOAC cryptocurrency is the digital token of a platform that strives to create the best site for developing decentralized apps using smart contracts.

Ardor is a blockchain-based ecosystem that offers handy network scaling options and has convenient customization for business.

The Tezos platform is equipped with a special toolkit that makes the automatic updating of the algorithm possible.

The Dropil (DROP) cryptocurrency is a token used within a cryptocurrency investment platform.

The Stratis project is a platform for the development of decentralized applications with one key difference from Ethereum – the Proof of Stake protection mechanism.

2 MonaCoin MONA -15.69% $1.14 0.07
3 Rchain RHOC -14.65% $0.208325 0.08
4 ETERNAL TOKEN XET -13.89% $1.70 0.10
5 ReddCoin RDD -13.10% $0.003860 0.11
6 MOAC MOAC -13.00% $1.61 0.10
7 Ardor ARDR -8.52% $0.113243 0.11
8 Tezos XTZ -8.16% $1.32 0.80
9 Dropil DROP -8.02% $0.003605 0.08
10 Stratis STRAT -7.93% $1.49 0.15

This report uses the data of ICOBox, ICOBox Blockchain Research Center (IBRC), and coinmarketcap.com
The change in price was calculated based on average daily data

Table 1.4 shows events that took place from October 1-7, 2018, that had an impact on both the prices of the dominant cryptocurrencies and the market in general, with an indication of their nature and type of impact.

Table 1.4. Key events of the week having an influence on cryptocurrency prices, October 1-7, 2018

Factors and events

(link to source)

Date of news Description Nature of impact Type of impact
1.                     Japanese Cryptocurrency Exchanges Tighten Customer Asset Management Rules

[source: cryptovest.com]
October 1, 2018 More frequent hacker attacks have led to the introduction of additional restrictions on “hot” wallets. It is proposed that exchanges be able to hold no more than 20% of client deposits on them. Market ⇓ Unfavorable
2.                     Malta’s Prime Minister Hails Crypto as ‘Future of Money’ in UN Speech

[source: coindesk.com]
October 1, 2018 The politician said that the liberalization of legislation on cryptocurrencies helped attract major market players and hundreds of millions in investments to the island. He also criticized the position of other countries on digital money, comparing the reluctance of politicians to adopt new technologies to the refusal to replace horse-drawn carriages with automobiles. Market ⇑ Favorable
3.                     Swell 2018: Ripple’s xRapid Goes Live, Gets Support From 3 Financial Institutions

[source: Coinspeaker]
October 2, 2018 The year’s most important achievement: Ripple has launched the xRapid payment service, which was developed to speed up payments between countries. XRP ⇑ Favorable
4.                     Brazilian Securities Regulators Clarify That Investment Funds Can Invest in Crypto Assets

[source: xbt.net]
October 4, 2018 The Brazilian authorities are gradually softening their stance on the crypto industry, which is having a positive effect on business activity in the country. However, the regulator still advised investors to be careful with digital assets and to remember that the risk of fraud is still high. Market ⇑ Favorable
5.                     Bitcoin Won’t Break $9,000 This Year, Galaxy Digital’s Novogratz Says

[source: cointelegraph.com]
October 2, 2018 One of the most optimistic cryptocurrency market experts has changed his forecast concerning the explosive growth of bitcoin by the end of the year. Considering today’s trends, Mr. Novogratz is still confident that the price of the first cryptocurrency will grow, but believes that it will take place gradually. Market ⇓ Unfavorable
6.                     Ethereum’s Upcoming Constantinople Hard Fork Gets Postponed

[source: Coinspeaker]
October 5, 2018 The launch of the hard fork on the Ethereum network has been postponed. It was supposed to take place in the test network around October 9. Bugs and concerns over the possible split of the blockchain hindered the launch. Market
ETH
Uncertain

 

To analyze trading activity on cryptocurrency exchanges, the ZAK-n Crypto index is calculated (see the Glossary). The values of the ZAK-4 Crypto and ZAK-8 Crypto indices are presented in Tables 1.1, 1.5.a, and 1.5.b. In September the 24-hour trading volumes (Volume 24h) for the four dominant cryptocurrencies (Bitcoin, Ethereum, Bitcoin Cash, Ripple) equaled from $5.3 billion to $14.1 billion, and in early October from $5.7-$7.5 billion (Table 1.5.a). At the start of October the value of the daily ZAK-4 Crypto ranged from 3.4% to 4.4% of capitalization. The highest trading volume was seen on October 1. The main reason for this activity was Ripple, the 24-hour trading volume of which has shown sharp fluctuations over the past three weeks ranging from $0.2 to $4.1 billion.

Table 1.5.a. Daily ZAK-4 Crypto index calculation (from October 1-7, 2018)

Crypto Bitcoin (BTC) Ethereum (ETH) Bitcoin Cash (BCH) Ripple (XRP) 4 Crypto
  Price Open Volume (24h)* Market cap Price Open Volume (24h)* Market cap Price Open Volume (24h)* Market cap Price Open Volume (24h)* Market cap Volume (24h) 4 crypto* Market cap 4 crypto ZAK-4 Crypto index
Date** $ USD billion USD billion $ USD billion USD billion $ USD billion USD billion $ USD billion USD billion USD billion USD billion %
Oct 7, 2018 6 591 3.3 114.1 225 1.5 23.1 510 0.4 8.9 0.49 0.5 19.6 5.7 165.6 3.4%
Oct 6, 2018 6 622 3.3 114.6 228 1.5 23.3 520 0.4 9.0 0.52 0.7 20.7 5.8 167.7 3.5%
Oct 5, 2018 6 574 3.7 113.8 222 1.5 22.8 514 0.4 8.9 0.53 0.6 21.1 6.2 166.5 3.7%
Oct 4, 2018 6 498 3.8 112.4 220 1.5 22.6 517 0.5 9.0 0.53 0.6 21.1 6.4 165.1 3.9%
Oct 3, 2018 6 554 3.9 113.4 226 1.7 23.2 532 0.5 9.2 0.52 0.8 20.7 6.9 166.5 4.1%
Oct 2, 2018 6 593 4.0 114.1 231 1.5 23.6 531 0.5 9.2 0.58 0.7 23.0 6.8 170.0 4.0%
Oct 1, 2018 6 620 4.0 114.5 233 1.6 23.9 532 0.5 9.2 0.58 1.4 23.3 7.5 170.9 4.4%

* Adjusted Volume – Volume from spot markets excluding markets with no fees and transaction mining
** All figures given as of 03:00 UTC of the corresponding day
*** This report uses the data of ICOBox, ICOBox Blockchain Research Center (IBRC), and coinmarketcap.com

By the end of last week the 24-hour trading volumes (Volume 24h) for the eight dominant cryptocurrencies not including Tether (Bitcoin, Ethereum, Bitcoin Cash, Ripple, Litecoin, Stellar, EOS, and Cardano) equaled $6.7 billion (Table 1.5.b), or 3.7% of their market capitalization. The ZAK-4 Crypto and ZAK-8 Crypto indices are considered in more detail in Tables 1.5.a and 1.5.b.

Table 1.5.b. Daily ZAK-8 Crypto index calculation (continuation of Table 1.5.а)

Crypto Stellar (XLM) Cardano (ADA) EOS (EOS) Litecoin (LTC) 8 Crypto
  Price Open Volume (24h)* Market cap Price Open Volume (24h)* Market cap Price Open Volume (24h)* Market cap Price Open Volume (24h)* Market cap Volume (24h) 8 crypto* Market cap 8 crypto ZAK-8 Crypto index
Date** $ USD billion USD billion $ USD billion USD billion $ USD billion USD billion $ USD billion USD billion USD billion USD billion %
Oct 7, 2018 0.24 0.03 4.6 0.081 0.03 2.1 5.7 0.53 5.2 58 0.44 3.4 6.7 180.9 3.7%
Oct 6, 2018 0.25 0.03 4.6 0.083 0.03 2.2 5.8 0.49 5.3 59 0.38 3.4 6.8 183.2 3.7%
Oct 5, 2018 0.24 0.04 4.6 0.081 0.03 2.1 5.8 0.55 5.2 58 0.37 3.4 7.2 181.9 4.0%
Oct 4, 2018 0.24 0.04 4.5 0.081 0.03 2.1 5.6 0.61 5.1 58 0.34 3.4 7.4 180.2 4.1%
Oct 3, 2018 0.25 0.05 4.7 0.082 0.04 2.1 5.6 0.60 5.1 60 0.45 3.5 8.0 181.8 4.4%
Oct 2, 2018 0.26 0.05 4.9 0.085 0.03 2.2 5.7 0.56 5.2 60 0.44 3.5 7.9 185.8 4.3%
Oct 1, 2018 0.26 0.07 4.9 0.085 0.04 2.2 5.7 0.70 5.2 61 0.46 3.6 8.7 186.7 4.7%

* Adjusted Volume – Volume from spot markets excluding markets with no fees and transaction mining
** All figures given as of 03:00 UTC of the corresponding day
*** This report uses the data of ICOBox, ICOBox Blockchain Research Center (IBRC), and coinmarketcap.com

Table 1.6 gives a list of events, information on which appeared last week, which could impact both the prices of specific cryptocurrencies and the market in general.

Table 1.6. Events that could have an influence on cryptocurrency prices in the future

 

Factors and events

(link to source)

Date of news Date of event* Description Nature of impact Type of impact
1. Ripple Is Leading a New Coalition to Lobby US Policymakers to Support Crypto

[source: bitrates.com]
October 1, 2018 n/a Crypto companies from San Francisco have formed a coalition: their main goal is a dialogue with the authorities. For this, they are bringing in professional lobbyists. Market ⇑ Favorable
2. South Korea’s Democratic Party Lawmakers Urges Authorities to Open Up the Road to ICOs
[source: cointelegraph.com]
October 2, 2018 n/a A Deputy from the Democratic Party will submit a new draft law to regulate ICOs at the next round of the National Assembly. The new draft law should give the green light to the holding of ICOs, but will also maintain strict controls over negative factors. Market ⇑ Favorable
3. Bots Are Manipulating Price of Bitcoin in ‘Wild West of Crypto’

[source: wsj.com]
October 2, 2018 n/a According to the WSJ, automated trading programs or bots are manipulating the prices for digital currencies. The bots’ strategy is reminiscent of a trading strategy that has been prohibited by regulators, so-called spoofing — the aggressive exchange of orders to influence the market price. If this news is confirmed, it could have a negative effect on the cryptocurrency market. Market ⇓ Unfavorable
4. SEC Sets October 16 as the New Deadline for Submitting Comments on Bitcoin ETFs

[source: coindoo.com]
October 6, 2018 October 26, 2018 The Commission has requested additional comments on rejected bitcoin ETFs. According to the statement of the stock market watchdog, the previous refusal will remain in force during the process of its reconsideration. Market ⇓ Unfavorable

*Possible date of the event in the future

1.2 Market trends

The weekly cryptocurrency and digital asset market trends from December 31, 2017, to October 7, 2018, are presented as graphs (Fig. 1.1-1.5).

Table 1.7. Legends and descriptions of the graphs

Global Figures Figure* Description
Total cryptocurrency market capitalization, USD million Fig. 1.1 This figure shows cryptocurrency and digital asset market capitalization trends from December 31, 2017.
The rate of market change (as a % to the beginning of 2017) Fig. 1.1 This figure shows the % change in cryptocurrency and digital asset market capitalization compared to December 31, 2017.
Change in the market capitalization (in USD million compared to previous period) Fig. 1.2 This figure shows the weekly change in USD million (increase or decrease) in cryptocurrency and digital asset market capitalization from December 31, 2017.
The rate of market change (as a % compared to the previous period) Fig. 1.2 This figure shows the % of weekly change (increase or decrease) in cryptocurrency and digital asset market capitalization from December 31, 2017.
Number of cryptocurrencies and digital assets Fig. 1.3 This figure shows the trends in the increase of the number of cryptocurrencies and digital assets circulating on cryptocurrency exchanges. On January 1, 2017, their number was 617, and as of October 7, 2018, this number had already reached 1,966 (coins and tokens on which there is information on capitalization and/or turnover were considered).
Average market capitalization, USD million Fig. 1.3 This figure reflects the growth in the average cryptocurrency and digital asset market capitalization from December 31, 2017, i.e. the ratio between the market capitalization of all cryptocurrencies and digital assets and their number.
Forecast of total cryptocurrency market capitalization Fig. 1.4, 1.5 This figure shows the time trend (forecast) change in cryptocurrency and digital asset market capitalization.

* NB! Average daily data are given in the graphs below. For this reason, the figures in the graphs may differ from the data in Table 1.1, where all figures were calculated at 03:00 UTC of the corresponding day. These differences in values may be significant during periods of high cryptocurrency market volatility.
** This report uses the data of ICOBox, ICOBox Blockchain Research Center (IBRC), and coinmarketcap.com

Figure 1.1. Weekly cryptocurrency market capitalization

* Average daily data (according to the data of coinmarketcap.com)

Figure 1.1 shows a graph of the weekly cryptocurrency market change from December 31, 2017, to October 7, 2018. Over this period, market capitalization dropped from $572.5 billion to $217.1 billion, i.e. by 62%. Last week (September 30-October 7, 2018) cryptocurrency market capitalization decreased from $225.9 billion to $217.1 billion (as of October 7, 2018, based on the average daily figures from coinmarketcap.com).

Figure 1.2. Weekly change in market capitalization

The market is subject to constant fluctuations. Nine of the thirteen weeks in the first quarter of 2018 were “in the red,” i.e. capitalization fell based on the results of each of these weeks, and the weekly fluctuations ranged from USD -136 billion to USD +250 billion.

Six of the thirteen weeks in the second quarter were “in the red.” The market grew based on the results of the other seven weeks. As noted earlier, a growth was seen in April, while in May and June there was generally a reduction in capitalization. The weekly fluctuations ranged from USD -72 billion to USD +62.2 billion.

In the third quarter seven of the 13 weeks saw an increase in capitalization, and six a decrease (with due account of average daily data of coinmarketcap.com, see Fig. 1.2). In July there was an increase of $20 billion, August saw a decrease of $49 billion, and in September capitalization fell by approximately $5 billion.

In the first week of the fourth quarter capitalization dropped by $5.4 billion, or by 2%.

Figure 1.3. Number of cryptocurrencies and digital assets

Data source: coinmarketcap.com (coins and tokens on which there is information on capitalization and/or turnover were considered)

Since December 31, 2017, the total number of cryptocurrencies and digital assets presented on coinmarketcap has increased from 1,335 to 2,042. However, when calculating cryptocurrency market capitalization only those coins and tokens on which there is information on trades (trading volume) are taken into consideration. Over the past week their number increased from 1,920 to 1,966, while average capitalization dropped to $110.4 million. In total, over the past month 133 new coins and tokens have appeared on coinmarketcap.com. However, it should be noted that a number of other coins and tokens were also excluded from the list. Among the tokens that were added to coinmarketcap.com last week, Nerves, WIZBL, Tolar and MIR COIN showed high trading volumes.

Figures 1.4 and 1.5. Forecast of total cryptocurrency market capitalization

One gets the impression that the cryptocurrency market has gone quiet in expectation of big events to come. The daily volatility of the leader of the cryptocurrency market (bitcoin) did not exceed ±4% over the month, and on average equaled ±1-2%. The news also does not have as big an impact on its price as it did earlier.

Based on the results of its research, the company Chainalysis has provided a comparison of bitcoins depending on the level of their turnover (liquidity) and types of owners. The following groups of coins were singled out: speculative coins, investment coins, service transactional coins, likely lost investment coins, and lost and unmined coins.

The traditional classification of the money supply into monetary aggregates (M0, M1, M2, M3 – where M0 are the most liquid and M3 are the least liquid categories) were used to determine the liquidity of the coins. The most liquid group included speculative coins (M0), which, according to Chainalysis, make up 23% of aggregate coins issued (4.8 million bitcoins). Investment coins turned out to be less liquid and fell into the M2 group (6.4 million, or 30% of aggregate coins issued). Likely lost investment coins and lost and unmined coins account for 6.1 million coins, or 29% of total coins issued. It should be noted that the share of speculative coins (M0) has more than doubled since the start of 2017.

At the same time, as reported by the Wall Street Journal, according to a number of experts the decentralized and insufficiently regulated cryptocurrency market is under the sway of trading bots that have a material impact on price formation. The asymmetrical nature of information, the division of spheres of influence, and the pressure from institutional and state structures is leading to a situation in which price manipulation schemes and fraud are being used on the “fledgling” cryptocurrency market. Methods of manipulation of information (spreading of rumors, misleading information, or misinformation), collusion during the performance of trading, overstating of trading volume through fictitious transactions, and the formation of various pump & dump schemes are leading to the possibility to redistribute income in favor of major players. Various methods are used to combat players who do not play fair; for example, back in February the Commodity Futures Trading Commission (CFTC) announced a reward for help in uncovering Pump & Dump schemes.

Annex – Glossary

Key terms Definition
Market capitalization Value of an asset calculated based on its current market (exchange) price. This economic indicator is used to assess the total aggregate value of market instruments, players, and markets. [Source: Wikipedia.org].
Cryptocurrency market capitalization The market value of an individual coin or token circulating on the market.
Total cryptocurrency market capitalization The market capitalization of cryptocurrencies and digital assets, i.e. the aggregate market value of cryptocurrencies and digital assets (coins and tokens) circulating on the market.
Dominance Market share, i.e. the ratio of market capitalization of a particular cryptocurrency (coin, token) to total cryptocurrency market capitalization. Expressed as a %.
Not Mineable

 

A coin that is not mineable. The term is used for cryptocurrencies (coins, tokens) which cannot be mined or issued through mining.
Pre-mined A pre-mined coin. The term is used for cryptocurrencies (coins, tokens) which are issued through mining, and a certain number of coins (tokens) have been created and distributed among certain users at the start of the project.
The rate of market increase (as a % compared to the beginning of the year) The rate of market increase (as a % compared to the start of the year), i.e. by how many % points did market capitalization increase compared to the start of the year.
The growth rate of the market (as a % to the beginning of the year) The rate of market growth (as a % compared to the start of the year), i.e. by how many times did market capitalization grow compared to the start of the year.
Increase in market capitalization (in USD million compared to the previous period) Increase in cryptocurrency and digital asset market capitalization (in USD million compared to the previous period), i.e. by how many USD million did market capitalization increase over the period.
The rate of market increase (as a % compared to the previous period) The rate of market increase (as a % compared to the previous period), i.e. by how many % points did market capitalization increase over the period.
The market growth rate (as a % compared to the previous period) The market growth rate (as a % compared to the previous period), i.e. by how many times did market capitalization grow compared to the previous period.
Number of cryptocurrencies and digital assets Number of cryptocurrencies and digital assets. At the beginning of 2018 over 1,300 cryptocurrencies and digital assets (coins and tokens) were circulating on the market.
Average market capitalization Average market capitalization, i.e. the ratio of the market capitalization of all cryptocurrencies and digital assets to their number.
ZAK-n Crypto index The index is calculated as a percentage and represents a ratio between the trading volume (transactions) on cryptocurrency exchanges per day (Volume 24h) for n dominant cryptocurrencies to their total market capitalization.

ZAK-4 Crypto index calculations include four dominant cryptocurrencies with the greatest market capitalization: Bitcoin, Ethereum, Bitcoin Cash, and Ripple.

ZAK-8 Crypto index calculations include the trading volume and market capitalization for eight cryptocurrencies.

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