This report presents data on the crypto market fluctuations over 2018, with special attention given to the trends of May, most notably those taking place during May 28-June 3, 2018.
Information as of June 4, 2018
- 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;
- Mike Raitsyn, Vision Director of Snowfox Technology
- 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 in May 2018, including over the past week (May 28-June 3, 2018).
1. General cryptocurrency and digital assets market analysis (by week, month, quarter). Market trends.
1.1 General cryptocurrency and digital assets market analysis (by week, month).
Table 1.1. Trends in capitalization of the cryptocurrency market and main cryptocurrencies from January 1, 2018, to June 3, 2018*
|Parameter||1-Jan-18||1-Feb-18||MoM, %||1-Mar-18||MoM, %||1-Apr-18||MoM, %||1-May-18||MoM, %||1-June-18||MoM, %||3-June-18||DoD, %|
|1||Total market capitalization, USD billion||612.9||517.2||-15.6%||440.0||-14.9%||263.9||-40.0%||423.2||60.4%||331.3||-21.7%||343.6||3.7%|
|2||Altcoin market capitalization, USD billion||376.2||344.8||-8.3%||264.6||-23.3%||145.2||-45.1%||265.8||83.1%||203.2||-23.6%||213.3||5.0%|
|Altcoin dominance, %||61.4%||66.7%||–||60.1%||–||55.0%||–||62.8%||–||61.3%||–||62.1%||–|
|3||Bitcoin price, $||14 112.2||10 237.3||-27.5%||10 385.0||1.4%||7 003.1||-32.6%||9 251.5||32.1%||7 500.7||-18.9%||7 632.1||1.8%|
|Bitcoin market capitalization, USD billion||236.7||172.4||-27.2%||175.4||1.8%||118.7||-32.3%||157.4||32.6%||128.0||-18.6%||130.3||1.8%|
|Bitcoin dominance, %||38.6%||33.3%||–||39.9%||–||45.0%||–||37.2%||–||38.6%||–||37.9%||–|
|4||Ethereum price, $||755.8||1 119.4||48.1%||856.0||-23.5%||397.3||-53.6%||670.5||68.8%||578.7||-13.7%||591.3||2.2%|
|Ethereum market capitalization, USD billion||73.1||109.0||49.1%||83.8||-23.1%||39.1||-53.3%||66.5||69.8%||57.7||-13.1%||59.0||2.2%|
|Ethereum dominance, %||11.9%||21.1%||–||19.0%||–||14.8%||–||15.7%||–||17.4%||–||17.2%||–|
|5||Bitcoin Cash price, $||2 534.8||1 491.1||-41.2%||1 204.8||-19.2%||688.0||-42.9%||1 348.6||96.0%||995.7||-26.2%||1 083.1||8.8%|
|Bitcoin Cash market capitalization, USD billion||42.8||25.3||-41.0%||20.5||-19.0%||11.7||-42.7%||23.1||96.6%||17.1||-25.9%||18.6||8.8%|
|Bitcoin Cash dominance, %||7.0%||4.9%||–||4.7%||–||4.4%||–||5.5%||–||5.2%||–||5.4%||–|
|6||Litecoin price, $||231.7||163.7||-29.3%||203.1||24.1%||116.9||-42.4%||148.3||26.9%||118.0||-20.4%||123.3||4.5%|
|Litecoin market capitalization, USD billion||12.6||9.0||-28.8%||11.3||25.0%||6.5||-42.0%||8.4||27.9%||6.7||-19.8%||7.0||4.5%|
|Litecoin dominance, %||2.1%||1.7%||–||2.6%||–||2.5%||–||2.0%||–||2.0%||–||2.0%||–|
|7||Volume (24h) 4 crypto, USD billion||15.7||17.3||10.2%||10.1||-41.4%||6.4||-36.9%||11.8||84.2%||7.7||-35.0%||7.9||2.4%|
|Market cap 4 crypto, USD billion||441.6||351.6||-20.4%||315.1||-10.4%||189.7||-39.8%||279.7||47.5%||226.9||-18.9%||233.2||2.8%|
|ZAK-4 Crypto index**||3.6%||4.9%||–||3.2%||–||3.4%||–||4.2%||–||3.4%||–||3.4%||–|
|4 crypto dominance, %||72.0%||68.0%||–||71.6%||–||71.9%||–||66.1%||–||68.5%||–||67.9%||–|
|8||Volume (24h) 8 crypto, USD billion||17.2||19.0||10.2%||11.3||-40.3%||7.2||-36.3%||16.0||121.3%||9.2||-42.4%||10.0||8.5%|
|Market cap 8 crypto, USD billion||488.6||393.4||-19.5%||349.3||-11.2%||208.7||-40.2%||319.5||53.1%||255.9||-19.9%||264.9||3.5%|
|ZAK-8 Crypto index***||3.5%||4.8%||–||3.2%||–||3.5%||–||5.0%||–||3.6%||–||3.8%||–|
|8 crypto dominance, %||79.7%||76.1%||–||79.4%||–||79.1%||–||75.5%||–||77.2%||–||77.1%||–|
* Data as of June 3, 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 are used. At present (June 3, 2018), the cryptocurrencies Bitcoin, Ethereum, Ripple, Bitcoin Cash, Cardano, Litecoin, Stellar, and EOS are used to calculate the ZAK-8 index.
Data source: coinmarketcap.com
During May 2018 cryptocurrency market capitalization decreased from $423.2 billion to $331.3 billion, i.e. by more than $90 billion or 21.7% (see Table 1.1, Fig. 1a), meaning the amount of capitalization has been nearly halved since the start of the year.
The dominance of the four and eight largest cryptocurrencies as of 03:00 UTC on June 1, 2018, equaled 68.5% and 77.2%, respectively. Bitcoin dominance increased over the month from 37.2% to 38.6% (see Table 1.1), i.e. one can conclude that altcoin prices decreased more during May than the price of the cryptocurrency market leader. The market contracted by $92 billion in May, mainly due to the reduction in the capitalization of altcoins by $62.6 billion, accompanied by a decrease in bitcoin capitalization of $29.4 billion.
The most significant changes in cryptocurrency market capitalization during the month are shown in Fig. 1a. Capitalization fluctuated by around $170 billion (from $472 billion to $304 billion).
Figure 1a. Cryptocurrency market capitalization since May 1, 2018
Data source: coinmarketcap.com
If you compare the changes in the capitalization of the cryptocurrency market and bitcoin, you will see that there was a high-level of clearly defined correlation between them in May. Figure 1b shows bitcoin capitalization (red line) imposed on cryptocurrency market capitalization (blue line). The lines are practically identical (Fig. 1b).
Figure 1b. Capitalization of the cryptocurrency market (blue) and bitcoin (red) since May 1, 2018
Data source: coinmarketcap.com
Price trends of the cryptocurrency market leaders during May 2018
Table 1.2 presents the price trends of 10 cryptocurrencies in May 2018. The price fluctuations among the top 10 cryptocurrencies by capitalization over the past month equaled more than 41% (High/Low). Cardano, Bitcoin Cash, and IOTA experienced the most sizeable fluctuations, with their highest (High) and lowest (Low) prices during May ranging from $0.17-$0.39; $880.9-$1,838.5, and $1.34-$2.68, respectively, a difference of more than a factor of two. The price fluctuations (High/Low) of Bitcoin and Ethereum in the top 10 were relatively small, and equaled 1.41 and 1.63 for the month (see Table 1.2).
Table 1.2. Price changes in the top 10 cryptocurrencies by capitalization during the period from May 1-June 1, 2018
|№||Name||Price Open, $||Change||Price change during May||High / Low|
|May 1, 2018||June 1, 2018||%||High, $||Low, $||D, $|
|Portfolio 10 crypto||-24.7%|
Data source: coinmarketcap.com
Thus, the prices of all the leading cryptocurrencies by capitalization depreciated during the period from May 1-June 1, 2018, within a range from -35.3% (TRON) to -10.2% (IOTA) compared to the start of the month (Fig. 2). The average portfolio return (Portfolio 10 crypto) for May for a portfolio consisting of equal shares of the top 10 cryptocurrencies was negative, and equaled -24.7% (i.e. the value of a balanced portfolio fell by 24.7% over the month).
The capitalization of the cryptocurrency market as a whole decreased by -21.7% during May.
Figure 2. Price change in the top 10 cryptocurrencies by capitalization during May 2018, %
(on the left the cryptocurrencies are ranked by the level of price depreciation over the month, and on the right – by the amount of capitalization as of June 1, 2018)
May turned out to be much less favorable than April, with all cryptocurrencies from the top 10 by capitalization falling in price.Tron (-35%), Cardano (-34%), EOS (-30%), and Stellar (-30%) experienced especially sharp falls. Ironically, these same four cryptocurrencies showed the highest growth in April, when Tron’s price increased by 164%, EOS by 260%, Cardano by 132%, and Stellar by 120%. This can be explained by the downward price adjustment common for every cryptocurrency after a large growth. Despite the expected launch of its own network, on the back of which it showed such strong growth in April, EOS was unable to overcome the falling market trend and depreciated by 30%, to which the discovery of critical network vulnerabilities in late May contributed greatly [Coinspeaker].
Bitcoin Cash performed a hard fork on May 15 (increasing the size of a block to 32 MB), and as expected the price of this cryptocurrency increased to a peak of $1500-1800 in early May. However, after the hard fork it began to fall. The resource Bitcoin.com, which misled clients with statements that Bitcoin Cash (BCH) was the real bitcoin (BTC), might have been partially responsible for this. This led to a public outcry, which could have had an effect on the BCH price*.Most cryptocurrencies followed the negative market trend. Some of the news items of the month that could have had an influence on this trend were: Japan is stiffening the rules for cryptocurrency exchanges [Btcmanager.com], another 8,200 bitcoins were moved from Mt.Gox wallets [CCN], the regulations on trading in cryptocurrencies and holding ICOs made tougher in countries such as the USA.However, the month of May did not have as negative an effect on Ethereum and IOTA. For Ethereum, this is due mainly to the issue of the new Casper protocol [Twitter], and in the case of IOTA – to the favorable news items surrounding the development of the first testnet, [Twitter] and the Trinity mobile wallet for IOTA [Twitter].
In addition, to compare the more long-term trends of the cryptocurrencies from the top 10, we have given data on the change in prices since the start of 2018 (Fig. 3). The adjustment of the cryptocurrency market over the five months of 2018 has been quite significant, with only two cryptocurrencies (EOC, TRON) from the top ten increasing in price since the beginning of the year.
Figure 3. Price change in the top 10 cryptocurrencies by capitalization since the start of 2018, %
(on the left the cryptocurrencies are ranked by the level of price growth since the start of the year, and on the right – by the amount of capitalization as of June 1, 2018)
Overall, during the five months from the beginning of January total cryptocurrency market capitalization fell from $600 billion to $330 billion, or 45%. This was caused by a large-scale and lengthy downward adjustment of the overheated market of November and December. The cryptocurrencies from the top 10 can be split into three groups: the first group includes those that changed in line with market trends, the second group includes those that outperformed the market, and the third group includes those that underperformed the market.
IOTA, Bitcoin, and Litecoin fall into the first group. The changes in their prices were within the range of overall market changes, and these cryptocurrencies did not experience any serious fluctuations in price and for the most part followed market trends.
The second group includes Ethereum, Stellar, Tron, and EOS, the prices of which fell less than the market as a whole or even showed growth despite the contraction of the market. The leaders from the top 10 were EOS and Tron, the main products of both of which were scheduled for development in the first half of 2018, which incited profiteers and long-term backers to invest in these cryptocurrencies. EOS and TRON are leaving the Ethereum network in June.
On June 2, 2018, the release of the first version of the EOS software for the EOSIO blockchain took place, while TRON launched a beta version of its main network and will switch to its own Odyssey 2.0 blockchain at the end of June. These events might have had a more serious effect on the Ethereum price, except for the fact that Ethereum also launched the updated Casper protocol, which is an important event and had a favorable impact on the cryptocurrency’s price. Holders of the Stellar cryptocurrency also anticipated the issue of a new product, the decentralized Stellar exchange, which helped the price of this cryptocurrency to perform better than the market.
The third group is made up of the least successful cryptocurrencies: Bitcoin Cash, Cardano and Ripple. The fall experienced by these cryptocurrencies could be caused by the overstated value of these cryptocurrencies at the end of 2017, when, for example, the price of Cardano and Ripple increased by fifteenfold during December. After such skyrocketing growth, the downward adjustment may even reach 70% or 80%.
Calculation of the index of trading activity on cryptocurrency exchanges
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, 1.3.a, and 1.3.b. In May the 24-hour trading volumes (Volume 24h) for the four dominant cryptocurrencies (Bitcoin, Ethereum, Bitcoin Cash, Ripple) equaled from $6.4 billion to $16.4 billion (Table 1.3.а). The value of the daily ZAK-4 Crypto fluctuated from 2.8% to 5.8% of capitalization. The highest trading volume was seen on May 3.
Table 1.3.a. Daily ZAK-4 Crypto index calculation (from May 1, 2018, to June 3, 2018)
|Crypto||Bitcoin (BTC)||Ethereum (ETH)||Bitcoin Cash (BCH)||Ripple (XRP)||4 Crypto|
|Price Open||Volume (24h)||Market cap||Price Open||Volume (24h)||Market cap||Price Open||Volume (24h)||Market cap||Price Open||Volume (24h)||Market cap||Volume (24h) 4 crypto||Market cap 4 crypto||ZAK-4 Crypto index|
|Date*||$||USD billion||USD billion||$||USD billion||USD billion||$||USD billion||USD billion||$||USD billion||USD billion||USD billion||USD billion||%|
|Jun 3, 2018||7 632||4.9||130.3||591||1.8||59.0||1 083||0.8||18.6||0.64||0.3||25.2||7.9||233.2||3.4%|
|Jun 2, 2018||7 537||4.9||128.6||580||1.9||57.9||1 003||0.7||17.2||0.62||0.3||24.5||7.8||228.3||3.4%|
|Jun 1, 2018||7 501||4.9||128.0||579||1.9||57.7||996||0.5||17.1||0.61||0.3||24.0||7.7||226.9||3.4%|
|May 31, 2018||7 406||5.1||126.4||559||2.0||55.7||984||0.7||16.9||0.60||0.3||23.6||8.1||222.6||3.6%|
|May 30, 2018||7 470||4.9||127.5||567||2.1||56.5||990||0.6||17.0||0.60||0.3||23.7||7.9||224.6||3.5%|
|May 29, 2018||7 129||5.7||121.6||516||2.3||51.5||897||0.7||15.4||0.56||0.4||21.8||9.1||210.3||4.3%|
|May 28, 2018||7 371||5.0||125.7||573||2.4||57.1||997||0.6||17.1||0.61||0.3||23.8||8.3||223.8||3.7%|
|May 27, 2018||7 362||4.1||125.6||589||1.8||58.7||1 009||0.5||17.3||0.61||0.2||24.0||6.5||225.5||2.9%|
|May 26, 2018||7 486||4.1||127.7||587||1.7||58.5||1 016||0.5||17.4||0.61||0.2||23.9||6.4||227.6||2.8%|
|May 25, 2018||7 592||4.9||129.5||602||2.1||60.0||1 073||0.6||18.4||0.63||0.3||24.8||7.9||232.7||3.4%|
|May 24, 2018||7 561||6.0||128.9||585||2.8||58.2||1 005||0.8||17.2||0.60||0.4||23.5||10.1||227.9||4.4%|
|May 23, 2018||8 037||6.5||137.0||647||3.0||64.4||1 142||0.9||19.6||0.65||0.5||25.4||10.8||246.4||4.4%|
|May 22, 2018||8 420||5.1||143.5||700||2.2||69.7||1 234||0.6||21.1||0.68||0.2||26.7||8.2||261.1||3.2%|
|May 21, 2018||8 522||5.2||145.3||717||2.0||71.4||1 296||0.6||22.2||0.70||0.3||27.5||8.0||266.3||3.0%|
|May 20, 2018||8 247||5.2||140.6||698||2.2||69.5||1 183||0.8||20.3||0.68||0.3||26.5||8.4||256.8||3.3%|
|May 19, 2018||8 256||4.7||140.7||695||2.0||69.2||1 207||0.6||20.7||0.68||0.2||26.7||7.6||257.2||2.9%|
|May 18, 2018||8 092||5.8||137.9||672||2.3||66.9||1 202||0.9||20.6||0.67||0.3||26.1||9.3||251.4||3.7%|
|May 17, 2018||8 370||5.9||142.6||709||2.4||70.5||1 290||0.8||22.1||0.71||0.3||28.0||9.4||263.2||3.6%|
|May 16, 2018||8 504||6.8||144.9||708||2.5||70.4||1 342||0.9||23.0||0.70||0.4||27.3||10.6||265.6||4.0%|
|May 15, 2018||8 705||6.7||148.3||731||2.5||72.7||1 430||0.9||24.5||0.74||0.4||29.0||10.6||274.4||3.9%|
|May 14, 2018||8 713||7.4||148.4||733||3.0||72.8||1 489||1.2||25.5||0.74||0.6||29.2||12.1||275.9||4.4%|
|May 13, 2018||8 515||5.9||145.0||687||2.4||68.3||1 475||0.9||25.3||0.70||0.5||27.4||9.7||265.9||3.6%|
|May 12, 2018||8 441||6.8||143.7||680||2.7||67.6||1 376||1.5||23.6||0.69||0.6||26.9||11.5||261.7||4.4%|
|May 11, 2018||9 053||8.5||154.1||727||3.3||72.2||1 527||1.5||26.2||0.76||1.0||29.6||14.3||282.2||5.1%|
|May 10, 2018||9 326||6.9||158.8||753||2.7||74.8||1 646||1.1||28.2||0.80||0.4||31.5||11.1||293.2||3.8%|
|May 9, 2018||9 224||7.2||157.0||753||2.9||74.8||1 608||1.3||27.5||0.81||0.6||31.9||12.0||291.2||4.1%|
|May 8, 2018||9 381||7.4||159.7||755||2.9||75.0||1 673||1.1||28.6||0.83||0.5||32.6||11.9||295.9||4.0%|
|May 7, 2018||9 646||7.4||164.2||793||4.3||78.8||1 767||1.4||30.2||0.87||0.6||34.1||13.7||307.3||4.5%|
|May 6, 2018||9 845||7.2||167.5||816||3.1||81.0||1 759||1.9||30.1||0.90||0.6||35.4||12.9||314.1||4.1%|
|May 5, 2018||9 700||7.7||165.1||785||3.0||77.9||1 517||1.7||26.0||0.90||0.7||35.1||13.0||304.0||4.3%|
|May 4, 2018||9 696||8.2||165.0||777||3.5||77.1||1 501||1.0||25.7||0.88||1.0||34.5||13.7||302.2||4.5%|
|May 3, 2018||9 234||10.2||157.1||687||4.2||68.1||1 460||1.3||25.0||0.86||0.7||33.6||16.4||283.8||5.8%|
|May 2, 2018||9 105||7.6||154.9||674||2.8||66.8||1 354||1.2||23.2||0.84||0.5||32.9||12.1||277.7||4.4%|
|May 1, 2018||9 251||7.7||157.4||670||2.7||66.5||1 349||0.8||23.1||0.84||0.6||32.8||11.8||279.7||4.2%|
All figures given as of 03:00 UTC of the corresponding day
Data source: coinmarketcap.com
The 24-hour trading volumes (Volume 24h) for the eight dominant cryptocurrencies (Bitcoin, Ethereum, Bitcoin Cash, Ripple, Litecoin, Stellar, EOS, and Cardano) equaled $10 billion by the end of last week (Table 1.3.b), or 3.8% of their market capitalization, i.e. trading volumes fell below the level at the start of the month. The ZAK-4 Crypto and ZAK-8 Crypto indices are considered in more detail in Tables 1.3.a and 1.3.b.
Table 1.3.b. Daily ZAK-8 Crypto index calculation (continuation of Table 1.3.a)
|Crypto||Stellar (XLM)||Cardano (ADA)||EOS (EOS)||Litecoin (LTC)||8 Crypto|
|Price Open||Volume (24h)||Market cap||Price Open||Volume (24h)||Market cap||Price Open||Volume (24h)||Market cap||Price Open||Volume (24h)||Market cap||Volume (24h)||Market cap||ZAK-8 Crypto index|
|Date||$||USD billion||USD billion||$||USD billion||USD billion||$||USD billion||USD billion||$||USD billion||USD billion||USD billion||USD billion||%|
|Jun 3, 2018||0.30||0.06||5.5||0.228||0.12||5.9||14.8||1.63||13.3||123||0.32||7.0||10.0||264.9||3.8%|
|Jun 2, 2018||0.29||0.06||5.4||0.223||0.12||5.8||12.3||2.88||11.0||120||0.31||6.8||11.2||257.2||4.4%|
|Jun 1, 2018||0.30||0.06||5.5||0.225||0.13||5.8||12.3||1.06||11.0||118||0.29||6.7||9.2||255.9||3.6%|
|May 31, 2018||0.28||0.08||5.2||0.210||0.20||5.5||12.0||1.14||10.7||117||0.30||6.7||9.8||250.6||3.9%|
|May 30, 2018||0.28||0.06||5.3||0.204||0.22||5.3||12.2||1.27||10.8||120||0.31||6.8||9.7||252.8||3.9%|
|May 29, 2018||0.25||0.06||4.7||0.175||0.19||4.5||11.7||1.88||10.4||112||0.35||6.3||11.5||236.3||4.9%|
|May 28, 2018||0.28||0.05||5.1||0.194||0.10||5.0||12.5||1.58||11.0||118||0.30||6.7||10.3||251.7||4.1%|
|May 27, 2018||0.28||0.05||5.3||0.196||0.06||5.1||12.3||0.94||10.8||119||0.26||6.7||7.8||253.5||3.1%|
|May 26, 2018||0.29||0.04||5.4||0.200||0.06||5.2||12.3||1.09||10.8||119||0.28||6.8||7.9||255.7||3.1%|
|May 25, 2018||0.29||0.05||5.4||0.209||0.08||5.4||12.8||1.62||11.2||123||0.30||6.9||9.9||261.7||3.8%|
|May 24, 2018||0.28||0.05||5.2||0.203||0.13||5.3||10.9||2.16||9.6||119||0.35||6.8||12.7||254.7||5.0%|
|May 23, 2018||0.30||0.04||5.6||0.224||0.12||5.8||12.3||1.59||10.8||129||0.37||7.3||13.0||275.9||4.7%|
|May 22, 2018||0.32||0.03||5.9||0.249||0.08||6.5||13.5||0.99||11.8||134||0.29||7.6||9.6||292.9||3.3%|
|May 21, 2018||0.33||0.03||6.2||0.256||0.09||6.6||14.0||1.06||12.2||140||0.31||7.9||9.5||299.3||3.2%|
|May 20, 2018||0.32||0.03||5.9||0.243||0.10||6.3||13.2||1.23||11.4||135||0.32||7.7||10.1||288.1||3.5%|
|May 19, 2018||0.32||0.02||5.9||0.246||0.06||6.4||13.0||1.02||11.3||136||0.31||7.7||9.0||288.5||3.1%|
|May 18, 2018||0.31||0.03||5.8||0.243||0.08||6.3||12.4||1.34||10.7||133||0.37||7.5||11.1||281.7||3.9%|
|May 17, 2018||0.34||0.03||6.2||0.257||0.08||6.7||12.9||1.64||11.1||140||0.32||7.9||11.4||295.0||3.9%|
|May 16, 2018||0.35||0.04||6.4||0.259||0.11||6.7||12.9||1.53||11.1||140||0.35||7.9||12.6||297.7||4.2%|
|May 15, 2018||0.37||0.04||6.9||0.274||0.10||7.1||14.1||1.37||12.0||147||0.42||8.3||12.5||308.8||4.1%|
|May 14, 2018||0.38||0.06||7.0||0.286||0.16||7.4||14.9||1.70||12.8||145||0.58||8.2||14.6||311.3||4.7%|
|May 13, 2018||0.36||0.07||6.7||0.272||0.18||7.0||14.2||1.59||12.1||142||0.38||8.0||11.9||299.8||4.0%|
|May 12, 2018||0.31||0.09||5.8||0.263||0.26||6.8||15.0||3.09||12.7||137||0.41||7.8||15.4||294.9||5.2%|
|May 11, 2018||0.35||0.08||6.6||0.297||0.35||7.7||17.5||2.92||14.8||149||0.53||8.4||18.2||319.7||5.7%|
|May 10, 2018||0.38||0.04||7.0||0.324||0.12||8.4||18.0||1.29||15.2||157||0.43||8.9||13.0||332.7||3.9%|
|May 9, 2018||0.39||0.05||7.2||0.328||0.18||8.5||18.1||1.20||15.3||160||0.45||9.0||13.9||331.1||4.2%|
|May 8, 2018||0.40||0.05||7.4||0.336||0.14||8.7||18.0||1.45||15.1||165||0.47||9.3||14.0||336.4||4.2%|
|May 7, 2018||0.41||0.05||7.7||0.350||0.17||9.1||17.7||2.00||14.8||172||0.57||9.7||16.5||348.6||4.7%|
|May 6, 2018||0.43||0.04||8.0||0.366||0.15||9.5||17.7||1.43||14.8||178||0.63||10.0||15.2||356.4||4.3%|
|May 5, 2018||0.43||0.04||8.0||0.361||0.14||9.4||17.1||1.61||14.3||168||0.74||9.5||15.6||345.1||4.5%|
|May 4, 2018||0.44||0.05||8.1||0.371||0.17||9.6||17.7||1.75||14.8||160||0.63||9.0||16.3||343.8||4.7%|
|May 3, 2018||0.44||0.08||8.2||0.372||0.30||9.6||19.3||2.27||16.0||152||0.62||8.6||19.7||326.2||6.0%|
|May 2, 2018||0.44||0.07||8.2||0.358||0.27||9.3||18.9||2.41||15.7||148||0.35||8.4||15.2||319.2||4.8%|
|May 1, 2018||0.43||0.15||7.9||0.343||0.37||8.9||17.7||3.33||14.6||148||0.34||8.4||16.0||319.5||5.0%|
Starting on May 22, Huobi, one of the largest cryptoexchanges, began issuing the new consolidated HUOBI 10 index, which shows the trends of 10 digital assets with a high market value and liquidity. The digital assets are split into four categories: coins, platforms, applications, and token assets. The base point of the HUOBI 10 is 1000. Over the past two weeks the index has increased by 96 points, and equaled around 1096 points on the morning of June 4, 2018.
Table 1.4 gives a list of events that took place in late May-early June 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 having an influence on cryptocurrency prices
|№||Factors and events
(link to source)
|Date of news||Description||Nature of impact||Type of impact|
|1.||GDPR & Blockchain – New EU Data Protection Regulation, a Blessing or a Curse to the Blockchain? [source: Oracletimes]||May 25, 2018||The goal of the European General Data Protection Regulation (GDPR) is decentralization in data storage, which is facilitated by the blockchain structure. However, blockchain cannot currently provide citizens the opportunity to delete their data (the participation of all elements of blockchain would be necessary to do so). This makes the technology incompatible with the laws of the European Union. The law requires the development of common data storage centers.||Market ⇑||Favorable|
|2.||Tencent Drives China’s Tech Hub to a Blockchain Future [source: Cryptoslate]||May 30, 2018||The Chinese company Tencent is developing a blockchain system for tax payments for the Chinese megalopolis Shenzhen. In China they believe that a “smart tax” will make it possible to identify evaders and modernize the economy.||Market ⇑||Favorable|
|3.||Chinese President Xi Jinping Calls Blockchain a ‘Breakthrough’ Technology [source: CNBC]||May 30, 2018||Xi Jinping expressed support for blockchain technology for the first time, announcing that blockchain, together with other technologies, is accelerating breakthrough applications. In the leader’s opinion, China must “focus on technological development and become the global center of science and innovation.”||Market ⇑||Unfavorable|
|4.||South Korean Supreme Court Labels Cryptocurrencies Assets with Measurable Value [source: Themerkle]||June 1, 2018||A judge has allowed the authorities to confiscate bitcoins as payment of fines in a case involving child pornography. The decision sets a precedent — there are dozens of cases being considered in the country to which this practice could be applied.||Market ⇑||Favorable|
|5.||Crypto Exchange for Institutional Traders Launches in Gibraltar [source: ]||June 2, 2018||Gibraltar is known for its liberal regulation of the cryptocurrency industry. It was also the first jurisdiction in Europe to introduce regulation of the ICO market.||Market ⇑||Favorable|
Table 1.5 gives a list of events that could impact both the prices of specific cryptocurrencies and the market in general.
Table 1.5. Events that could have an influence on cryptocurrency prices in the future
|Factors and events
(link to source)
|Date of news||Description||Nature of impact||Type of impact|
|1.||NYSE Owner ICE Has Been Working on Bitcoin Trading Platform [source: Coinspeaker]||May 9, 2018||Intercontinental Exchange, the largest forward market operator, is developing an online platform for trading in cryptocurrencies||Market ⇑
|2.||Ethereum Futures Live on Trading Platform Crypto Facilities [source: Btcmanager]||May 14, 2018||British broker Crypto Facilities has launched trading of the first Ethereum futures in the world. According to a company representative, investors can open both long and short positions and try to fill a gap in the market||Market ⇑
|3.||Maersk to Launch 2 Blockchain Apps with IBM; Starts Using EY’s Insurwave [source: Cryptovest]||May 29, 2018||One of the apps will be designed to improve the transparency of the supply chain from warehouse to end consumer, and the second should simplify trading without paperwork.||Market ⇑
|4.||BTCC Plans Major Overhaul [source: Themerkle]||May 30, 2018||The oldest bitcoin exchange in China is returning to the crypto market: BTCC will introduce its updated trading platform in June. Among its advantages, the owners name increased liquidity and faster confirmation of deposits and withdrawal of funds (On May 24, 2018, BTCC presented the new BTCC Exchange platform)||Market ⇑||Favorable|
1.2 Market trends
The weekly cryptocurrency and digital asset market trends from December 31, 2017, to June 3, 2018, are presented as graphs (Fig. 1.1-1.5)*.
Table 1.6. Legends and descriptions of the graphs
|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 June 3, 2018, this number had already reached 1,562.|
|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.
These differences in the values may be significant during periods of high cryptocurrency market volatility.
Data source: coinmarketcap.com
Figure 1.1. Total 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 June 3, 2018. Over this period, market capitalization dropped from $572.5 billion to $347.2 billion, i.e. by 39%. Last week (May 28-June 3, 2018) cryptocurrency market capitalization decreased from $326.4 billion to $347.2 billion (as of June 3, 2018, based on the average figures from coinmarketcap.com).
Figure 1.2. Change in market capitalization
The market is susceptible to sudden and drastic fluctuations. During the first week of January, market capitalization increased by approximately $250 billion, or 44%. The largest weekly fall in the first quarter of 2018 was $136 billion, or 23%, during the week of January 28-February 4, 2018.
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. In the second quarter the market has grown over the first five weeks, followed by a downward adjustment over the next three weeks. Over the past week (May 28-June 3, 2018) growth equaled around 6%, or $20.8 billion (with due account of average daily data, see Fig. 1.2).
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 considered when calculating market capitalization has increased from 1,335 to 1,562. Their number increased by 3, from 1,559 to 1,562, over the past week, and average capitalization equaled $222.3 million. In total, over the past month 78 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. From among the tokens that were added to coinmarketcap.com last week, Endor Protocol, SPINDLE, ZIP, and NKN showed high trading volumes. Among others, one new project to keep an eye on is IoTeX, the 24-hour trading volume of which reached $180 million.
Figures 1.4 and 1.5. Forecast of total cryptocurrency market capitalization
The activity of China and South Korea to regulate and attract investment in blockchain increased noticeably in May.
The committee of the National Assembly of South Korea on the fourth industrial revolution has issued an official recommendation to the country’s government to overturn the ban on ICOs introduced in September of last year (according to the data of Business Korea). The Assembly proposed that a legal framework for trading in cryptocurrencies be created, including for areas related to the holding of ICOs.
The Chairman of the People’s Republic of Chinese, Xi Jinping, spoke out favorably on blockchain technology in his speech in Beijing at the annual conference organized by the Chinese Academy of Sciences on May 28, recognizing its groundbreaking potential.
On May 26, 2018, the development prospects of the industry were discussed during a conversation with representatives of major companies in the blockchain industry (Xunlei, Danhua Capital) on the Chinese state television station CCTV, and it was announced that blockchain is much more valuable than the internet.
As we noted in our last report, the oldest bitcoin exchange of China is returning to the crypto market. BTCC will present the new BTCC Exchange platform in June 2018. BTCC’s announcement stated the following: “After the launch, we will support trading pairs such as BTC, ETH, BCH, LTC/USD, ETH, BCH, LTC/BTC, etc.”
A watershed event that took place in financing of blockchain technology in China should also be noted. The total amount of financing of Qulian Technology (Fun Chain Technology) from the Shanghai-based finance company Xinhu Zhongbao will exceed 1.5 billion yuan (around $226 million). After the financing is completed, Fun Chain Technology will become the first “quasi-unicorn” enterprise in the blockchain industry. Fun Chain Technology is a leading international blockchain company responsible for the Hyperchain project.
According to the data of Сoinjournal: the digital wallet of the imToken cryptocurrency collected $10 million in a Series A funding round from the Chinese investment company IDG Capital, which has supported major projects such as Circle, Ripple and Bitmain. The imToken ecosystem of products includes Tokenlon, a decentralized exchange (created in partnership with Kyber Network and 0x), and a decentralized app (DApp) store.
Without a doubt, the activity of blockchain giants China and South Korea could have a favorable impact on cryptocurrency market capitalization.
In conclusion, we present the rating from Weiss Ratings. On May 25 the agency published its latest rating of 93 cryptocurrencies. They were assessed based on two criteria: technology and adoption (Technology/Adoption), and investment risk to reward (Investment Risk/Reward). So far, this agency has never given a cryptocurrency its highest “A” rating. This time the list of the best cryptocurrencies with a “B” rating included only three cryptocurrencies: Cardano, EOS and Decred. The largest cryptocurrencies by capitalization: Bitcoin, Ethereum, and Ripple, received a “B-” rating.
Annex – Glossary
|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: https://en.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 %.|
|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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