Please see our report covering data on cryptocurrency market movements during 2018. Strong focus has been placed on the analysis of fluctuations taking place in June 2018, particularly June 4-10, 2018.
Information as of June 11, 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;
- 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 have taken place in June 2018, including over the past week (June 4-10, 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 February 1, 2018, to June 10, 2018*
|Parameter||1-Feb-18||1-Mar-18||MoM, %||1-Apr-18||MoM, %||1-May-18||MoM, %||1-June-18||MoM, %||3-June-18||DoD, %||10-June-18||DoD, %|
|1||Total market capitalization, USD billion||517.2||440.0||-14.9%||263.9||-40.0%||423.2||60.4%||331.3||-21.7%||343.6||3.7%||335.5||-2.3%|
|2||Altcoin market capitalization, USD billion||344.8||264.6||-23.3%||145.2||-45.1%||265.8||83.1%||203.2||-23.6%||213.3||5.0%||207.4||-2.8%|
|Altcoin dominance, %||66.7%||60.1%||–||55.0%||–||62.8%||–||61.3%||–||62.1%||–||61.8%||–|
|3||Bitcoin price, $||10 237.3||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%||7 499.6||-1.7%|
|Bitcoin market capitalization, USD billion||172.4||175.4||1.8%||118.7||-32.3%||157.4||32.6%||128.0||-18.6%||130.3||1.8%||128.1||-1.7%|
|Bitcoin dominance, %||33.3%||39.9%||–||45.0%||–||37.2%||–||38.6%||–||37.9%||–||38.2%||–|
|4||Ethereum price, $||1 119.4||856.0||-23.5%||397.3||-53.6%||670.5||68.8%||578.7||-13.7%||591.3||2.2%||594.4||0.5%|
|Ethereum market capitalization, USD billion||109.0||83.8||-23.1%||39.1||-53.3%||66.5||69.8%||57.7||-13.1%||59.0||2.2%||59.4||0.7%|
|Ethereum dominance, %||21.1%||19.0%||–||14.8%||–||15.7%||–||17.4%||–||17.2%||–||17.7%||–|
|5||Bitcoin Cash price, $||1 491.1||1 204.8||-19.2%||688.0||-42.9%||1 348.6||96.0%||995.7||-26.2%||1 083.1||8.8%||1 087.5||0.4%|
|Bitcoin Cash market capitalization, USD billion||25.3||20.5||-19.0%||11.7||-42.7%||23.1||96.6%||17.1||-25.9%||18.6||8.8%||18.7||0.5%|
|Bitcoin Cash dominance, %||4.9%||4.7%||–||4.4%||–||5.5%||–||5.2%||–||5.4%||–||5.6%||–|
|6||Litecoin price, $||163.7||203.1||24.1%||116.9||-42.4%||148.3||26.9%||118.0||-20.4%||123.3||4.5%||117.6||-4.6%|
|Litecoin market capitalization, USD billion||9.0||11.3||25.0%||6.5||-42.0%||8.4||27.9%||6.7||-19.8%||7.0||4.5%||6.7||-4.5%|
|Litecoin dominance, %||1.7%||2.6%||–||2.5%||–||2.0%||–||2.0%||–||2.0%||–||2.0%||–|
|7||Volume (24h) 4 crypto, USD billion||17.3||10.1||-41.4%||6.4||-36.9%||11.8||84.2%||7.7||-35.0%||7.9||2.4%||9.3||18.3%|
|Market cap 4 crypto, USD billion||351.6||315.1||-10.4%||189.7||-39.8%||279.7||47.5%||226.9||-18.9%||233.2||2.8%||232.1||-0.4%|
|ZAK-4 Crypto index**||4.9%||3.2%||–||3.4%||–||4.2%||–||3.4%||–||3.4%||–||4.0%||–|
|4 crypto dominance, %||68.0%||71.6%||–||71.9%||–||66.1%||–||68.5%||–||67.9%||–||69.2%||–|
|8||Volume (24h) 8 crypto, USD billion||19.0||11.3||-40.3%||7.2||-36.3%||16.0||121.3%||9.2||-42.4%||10.0||8.5%||12.2||22.1%|
|Market cap 8 crypto, USD billion||393.4||349.3||-11.2%||208.7||-40.2%||319.5||53.1%||255.9||-19.9%||264.9||3.5%||261.9||-1.1%|
|ZAK-8 Crypto index***||4.8%||3.2%||–||3.5%||–||5.0%||–||3.6%||–||3.8%||–||4.7%||–|
|8 crypto dominance, %||76.1%||79.4%||–||79.1%||–||75.5%||–||77.2%||–||77.1%||–||78.1%||–|
* Data as of June 10, 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 10, 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
Over the past week (June 4-10, 2018) cryptocurrency market capitalization decreased, and as of 03:00 UTC on June 10 equaled $335.5 billion (see Table 1.1). However, by the end of Sunday capitalization had dropped to $299 billion (Fig. 1a). Ultimately, the fall over the 24 hours from June 10-11 equaled nearly $50 billion (from $340 billion to $291 billion) (Fig. 1a).
The dominance of the four and eight largest cryptocurrencies as of 03:00 UTC on June 10, 2018, equaled 69.2% and 78.1%, respectively, with bitcoin dominance equaling 61.8% (see Table 1.1). Despite the overall reduction in cryptocurrency market capitalization, considerable growth was seen last week in the prices of certain cryptocurrencies from the third echelon by capitalization (top 500), such as Swarm (+135.77%), AirToken (+87.5%), ODEM (+84.8%), Maecenas (+53.6%), Stakenet (+53.1%) and others.
As noted before, there has been a very high correlation between the capitalization of the cryptocurrency market as a whole and bitcoin for several weeks in a row (see Fig. 1b). The maximum and minimum points and the overall configuration of the cryptocurrency market capitalization charts (with their characteristic “steps”) show an almost complete correspondence.
Figure 1a. Cryptocurrency market capitalization since June 3, 2018
Figure 1b shows bitcoin capitalization (red line) imposed on cryptocurrency market capitalization (blue line). The lines are practically identical.
Figure 1b. Capitalization of the cryptocurrency market (blue) and bitcoin (red) since June 4, 2018
Data source: coinmarketcap.com
The rise and fall of cryptocurrency prices over the past week (June 4-10, 2018)
During the period from June 4-10, 2018, the change in the prices of cryptocurrencies in the top 500 ranged from -40% (Sentinel Chain) to +135.77% (Swarm). The most favorable news for Swarm this week was the announcement of the launch of its Smart City and Smart Planet Fund (Twitter). The daily trading volumes of this cryptocurrency are not very large, around $100,000, which allowed the price to more than double on the strength of this news. Sentinel Chain turned out to be one of the most unsuccessful cryptocurrencies this week, with its price falling by 40%. You will recall that Sentinel Chain gives platform participants the ability to use their heads of livestock as collateral. Thanks to Sentinel Chain, people who currently do not have access to banking services can receive a loan.
The price of 58 cryptocurrencies and digital assets from the top 500 showed growth, including only seven from the top 100.
This past week the number of cryptocurrencies with a capitalization of more than $1 billion remained the same, 22, with Binance Coin being the only one to show a price increase (+3.7%). All the other coins showed a downward adjustment: IOTA (-20.2%), Cardano (-17.19%), OmiseGO (-14.45%), etc.
Total cryptocurrency market capitalization fell over the past week, and, as mentioned above, the largest market plunge (by approximately $40 billion) took place on June 10, 2016 (see Fig. 1.1 below).
The coins and tokens from the top 200 that demonstrated the largest price growth are given in Fig. 2.
Biggest gainers and losers over the week (June 4-10, 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 200 (Fig. 2) and top 100 (Fig. 3) in terms of market capitalization (according to the data of coinmarketcap.com) were considered.
Figure 2. Largest growth in prices over the past week
Data source: 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 June 10, 2018||Market capitalization, USD billion||Factors or events that might have led to a growth in cryptocurrency prices over the past week|
|1||Paypex||PAYX||103.54%||$1.23||0.08||Neither of the leaders of the list of coins with the largest growth over the week (Paypex and ODEM) were involved in any meaningful and important events last week, and the sharp increase in their prices can be explained by market speculation, since the daily trading volumes of both coins equaled no more than several hundred thousand US dollars prior to their rapid growth.|
Bitcoin Interest, on the other hand, had more significant trading volumes, and the 46% increase in its price over the week might have been due to the news on its upcoming listing on the HitBTC cryptoexchange. (Twitter)
The price of Bibox Token rose this week due to a series of favorable events, including the introduction of the Market Maker Plan (Twitter)
There were no major events involving the remaining cryptocurrencies, and the change in their price might be due to market volatility and speculation.
You will remember that GXChain is a blockchain-based decentralized information exchange that makes it possible to create a bridge between data sources issued on different platforms and to implement peer-to-peer trading and information exchange between all manner of organizations and agencies.
Mixin (XIN) is the digital token of a decentralized mobile messenger intended for the storage and exchange of encryption tools between users.
CyberVein is a project for work with information and its exchange between users.
Emercoin (EMC) is an anonymous cryptocurrency. The anonymity of Emercoin (EMC) is achieved through a P2P system that makes the interception of any information impossible.
The GameCredits (GAME) cryptocurrency is generally considered the first cryptocurrency created for the world of Internet games.
Huobi Token is a digital token that was created by the developers of the Huobi exchange as an additional tool for payment of transaction fees.
A depreciation in price was seen last week for 442 coins and tokens from the top 500 cryptocurrencies and digital assets by capitalization. The ten cryptocurrencies 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 June 10, 2018||Market capitalization, USD billion||Factors or events that might have led to a fall in cryptocurrency prices over the past week|
|1||Loom Network||LOOM||-37.27%||$0.241173||0.15||The developers of the Loom Network have decided to correct the pressing issues plaguing Ethereum, and improved the features responsible for network scaling. Essentially, the Loom Network will provide users with functions similar to Ethereum, but there will be some special features. However, over the past few months one can see the project concentrating on its game with zombies, which is not nearly as far-reaching as the original plans suggested, which has led to a fall in price (no growth for several months now).|
Veritaseum is a blockchain-based platform that functions like an investment fund, the transfer of funds on which is performed using smart contracts without third-party influence.
Bitcoin Private. The platform’s key distinguishing feature is the fact that two coins (bitcoin and ZClassic) were involved simultaneously in a hard fork (at the end of February 2018). Therefore, for all intents and purposes Bitcoin Private became the first digital currency that works based on two blockchains simultaneously.
IOS Token is the digital token of a brand-new network based on an IOS (Internet of Services) blockchain. According to the developers, IOS is the most secure and scalable working network based on blockchain technology.
Theta Token is the key tool of a platform for promotion of video materials. The THETA token will be used for user incentives on the platform.
Substratum is the digital token of a decentralized platform that is attempting to create a new generation Internet, or the so-called Internet 3.0. The core of the platform’s offering lies in the decentralized storage of information on computers connected to the platform.
Polymath is a digital token for a platform that would like to create a single space for trading in securities on blockchain.
Aelf is the digital token of a platform working to build a space capable of uniting decentralized apps in one place.
Kyber Network (KNC) is a decentralized platform that functions as an currency exchange and payment system.
Golem (GNT) is a Ethereum-based encryption project that consists of a peer-to-peer network with its own token (GNT).
Data source: coinmarketcap.com
The change in price was calculated based on average daily data
Table 1.4 shows events that took place from June 4-10, 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, June 4-10, 2018
|№||Factors and events|
(link to source)
|Date of news||Description||Nature of impact||Type of impact|
|1.||Baidu is “Currently Completing a Blockchain Transformation” [source: Financemagnates]||June 4, 2018||The Chinese search engine Baidu has announced the launch of a new blockchain protocol. The Super Chain project is devoted to solving the problem of high energy consumption during cryptocurrency mining.||Market ⇑||Favorable|
|2.||Samsung SDS Launches Blockchain Financial Platform Nexfinance [source: CCN]||June 5, 2018||The Korean company Samsung SDS has presented the Nexfinance platform, which combines blockchain technology, artificial intelligence and big data analysis. The creators believe that this innovation will move us nearer to the “fourth industrial revolution.”||Market ⇑||Favorable|
|3.||What Ban? Cryptocurrency Cleared for Trading as Commodity by Indonesian Regulator [source: CCN]||June 5, 2018||The rules of regulation and taxation of cryptoexchanges will be developed for the introduction of trading in digital currencies. The passing of a law could also accelerate the issue of a national cryptocurrency.||Market ⇑||Favorable|
|4.||14 Italian Lenders Trial Blockchain for Interbank Reconciliations [source: Cryptovest]||June 7, 2018||A group of 14 Italian banks has begun testing blockchain. According to experts, the technology will increase transaction speed and make communications between banks more transparent and effective.||Market ⇑||Unfavorable|
|5.||Alibaba’s Ant Financial Raises $14 Billion in Series C Equity to Accelerate Globalization [source: Coinspeaker]||June 8, 2018||Here we are talking about Ant Financial, which belongs to Alipay, the leading payment provider in China with 800 million users. Blockchain could help the company take its payment systems to a new level.||Market ⇑||Favorable|
|6.||Swiss Bank Offers Cryptocurrency Business Accounts [source: Crypto-news]||June 9, 2018||Hypothekarbank Lenzburg became the first bank in the country to offer this service to the cryptocurrency community. The bank intends to extend its cooperation in this area, but to keep in mind the high risk of money laundering in the industry.||Market ⇑||Favorable|
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 June the 24-hour trading volumes (Volume 24h) for the four dominant cryptocurrencies (Bitcoin, Ethereum, Bitcoin Cash, Ripple) equaled from $5.9 billion to $9.3 billion (Table 1.5.a). The value of the daily ZAK-4 Crypto ranged from 2.5% to 4% of capitalization. The highest trading volume was seen on June 10.
Table 1.5.a. Daily ZAK-4 Crypto index calculation (from June 1-10, 2018)
|Crypto||Bitcoin (BTC)||Ethereum (ETH)||Bitcoin Cash (BCH)||Ripple (XRP)||4 Crypto|
|Price Open||Volume (24h)||Market cap||Price Open||Volume (24h)||Market cap||Price Open||Volume (24h)||Market cap||Price Open||Volume (24h)||Market cap||Volume (24h) 4 crypto||Market cap 4 crypto||ZAK-4 Crypto index|
|Date*||$||USD billion||USD billion||$||USD billion||USD billion||$||USD billion||USD billion||$||USD billion||USD billion||USD billion||USD billion||%|
|Jun 10, 2018||7 500||5.8||128.1||594||2.2||59.4||1 087||0.8||18.7||0.66||0.5||25.9||9.3||232.1||4.0%|
|Jun 9, 2018||7 633||3.8||130.4||601||1.5||60.1||1 117||0.4||19.2||0.67||0.2||26.5||5.9||236.1||2.5%|
|Jun 8, 2018||7 685||4.2||131.3||605||1.6||60.5||1 145||0.5||19.7||0.68||0.2||26.6||6.6||238.0||2.8%|
|Jun 7, 2018||7 651||4.5||130.7||608||1.9||60.7||1 135||0.6||19.5||0.68||0.2||26.5||7.2||237.4||3.0%|
|Jun 6, 2018||7 626||4.7||130.2||610||1.8||61.0||1 157||0.6||19.9||0.68||0.3||26.6||7.3||237.7||3.1%|
|Jun 5, 2018||7 501||5.0||128.1||593||1.8||59.3||1 110||0.7||19.1||0.66||0.4||26.0||7.9||232.4||3.4%|
|Jun 4, 2018||7 723||5.0||131.8||619||1.9||61.9||1 171||0.9||20.1||0.69||0.6||27.2||8.4||241.0||3.5%|
|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%|
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) increased sharply to $12.2 billion by the end of last week (Table 1.5.b), or 4.7% of their market capitalization. The ZAK-4 Crypto and ZAK-8 Crypto indices are considered in more detail in Tables 1.5.a and 1.5.b.
Table 1.5.b. Daily ZAK-8 Crypto index calculation (continuation of Table 1.5.а)
|Crypto||Stellar (XLM)||Cardano (ADA)||EOS (EOS)||Litecoin (LTC)||8 Crypto|
|Price Open||Volume (24h)||Market cap||Price Open||Volume (24h)||Market cap||Price Open||Volume (24h)||Market cap||Price Open||Volume (24h)||Market cap||Volume (24h)||Market cap||ZAK-8 Crypto index|
|Date||$||USD billion||USD billion||$||USD billion||USD billion||$||USD billion||USD billion||$||USD billion||USD billion||USD billion||USD billion||%|
|Jun 10, 2018||0.28||0.05||5.3||0.202||0.14||5.2||14.0||2.32||12.6||118||0.40||6.7||12.2||261.9||4.7%|
|Jun 9, 2018||0.29||0.04||5.3||0.205||0.05||5.3||14.0||1.18||12.6||120||0.24||6.8||7.5||266.2||2.8%|
|Jun 8, 2018||0.29||0.05||5.5||0.211||0.07||5.5||14.6||1.11||13.1||122||0.29||6.9||8.1||268.9||3.0%|
|Jun 7, 2018||0.30||0.05||5.5||0.216||0.08||5.6||14.0||1.02||12.5||121||0.37||6.9||8.7||268.0||3.2%|
|Jun 6, 2018||0.29||0.05||5.5||0.221||0.08||5.7||14.3||1.02||12.8||122||0.32||6.9||8.8||268.5||3.3%|
|Jun 5, 2018||0.29||0.05||5.4||0.214||0.12||5.6||13.6||1.45||12.2||120||0.30||6.8||9.8||262.3||3.7%|
|Jun 4, 2018||0.30||0.06||5.7||0.228||0.12||5.9||14.6||1.30||13.1||125||0.30||7.1||10.1||272.7||3.7%|
|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%|
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. On June 10-11 the index plummeted by 140 points over several hours to 907, and now sits at around 940 points (June 11, 2018, 10:00 UTC/GMT+3). We remind you that the base point of the HUOBI 10 is 1000.
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||Description||Nature of impact||Type of impact|
|1.||China Has Built a Blockchain System That Could Replace Paper Checks [source: Coindesk]||June 5, 2018||The People’s Bank of China has finished building a blockchain system for digitization of checks. According to the developers, the system will help solve the longstanding problem of check fraud and make transactions more transparent.||Market ⇑|
|2.||IMF Releases Report on Cryptocurrencies: Highly Regards the Technology’s Benefits and Use Cases [source: Btcmanager]||June 5, 2018||The International Monetary Fund (IMF) believes that the use of cryptocurrencies will increase, and they may begin to replace money in some regions and industries of the world economy.||Market ⇑|
1.2 Market trends
The weekly cryptocurrency and digital asset market trends from December 31, 2017, to June 10, 2018, are presented as graphs (Fig. 1.1-1.5).
Table 1.7. 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 10, 2018, this number had already reached 1,585 (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.
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 10, 2018. Over this period, market capitalization dropped from $572.5 billion to $324.2 billion, i.e. by 43%. Last week (June 4-10, 2018) cryptocurrency market capitalization decreased from $347.2 billion to $324.2 billion (as of June 10, 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 equaled $136 billion, or 23%, during the period from 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 grew over the first five weeks, followed by a three-week downward adjustment. Over the past week (June 3-10, 2018) the market contracted by around 7%, or $23 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 1,585. Over the past week their number increased by 23, from 1,562 to 1,585, and average capitalization equaled $204.6 million. In total, over the past month 76 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, QuarkChain, TRAXIA, and The Abyss showed high trading volumes. The new project QuarkChain (which completed its ICO on June 3, 2018), the 24-hour trading volume of which has reached $123 million, is particularly noteworthy. (Demand for this project’s tokens exceeded supply many times over during the ICO. The hard cap of the ICO was $20 million. Due to these factors, the first two days after the ICO saw the price increase by 10x and 18x, with capitalization currently equaling $58 million).
Figures 1.4 and 1.5. Forecast of total cryptocurrency market capitalization
Summary of the news for the past week
Microsoft acquires GitHub for $7.5 billion. On June 4, 2018, Microsoft Corp. announced that it had reached an agreement on the acquisition of GitHub (a web service for hosting IT projects, which provides the source codes of developments). This news received a mixed reaction in the crypto community. However, a competing platform GitLab decided to use this news as an opportunity to increase the number of projects with open source code hosted on its platform.
Forbes: Ant Financial (China), a payment branch of the Internet giant Alibaba, completed a round of mega-financing that collected a grand total of $14 billion from domestic and international backers.
Oppenheimer analyst Tim Horan said in a report to clients that the rise in blockchain technology may pose a threat to Internet giants Facebook, Amazon, Netflix and Google (FANG) due to the decentralization of the Internet. That is why these companies have already started working actively in the blockchain field. Horan singled out Microsoft as the current leader for blockchain as a service, but also noted that Amazon Web Services (AWS) and other system integrators were making investments.
Therefore, one of these companies may be able to take the lead.
Fujitsu developed a blockchain project for tokenization of the coupons used in retail shopping centers.
Samsung is opening an innovative financing platform.
The old Alcoa aluminum plant in Massena (USA) will be transformed into one of the largest bitcoin mining enterprises in the world. The American Coinmint mining company has invested $700 million in the project. The idea is connected with the availability in Massena of inexpensive sources of electricity (hydroelectric power plants and wind turbines).
In an interview with Bloomberg News, Jihan Wu, the CEO of Bitmain, the largest manufacturer of cryptocurrency mining equipment, said that Bitmain earned $2.5 billion last year and that he and co-founder Micree Zhan together own around 60% of the business. Wu had previously stated that Bitmain’s capitalization equals $12 billion and that the company is currently preparing the groundwork for the holding of an ICO outside of China.
According to the data of СoinDesk, the People’s Bank of China has completed work on a blockchain-based system for digitizing the checks issued by domestic companies. This will increase the effectiveness of regulation and lower costs, and the bank will have complete access to all entries on the check.
CoinDesk also reports that the Bank of Thailand (BoT) is considering implementing blockchain technology in the system of interbank settlements using its own cryptocurrency pursuant to the Inthanon project.
The cryptocurrency market and blockchain technology are still attracting institutional backers
The number of companies offering the possibility to purchase ВТС, ЕТH, and EOS futures is increasing.
The New York Times has reported on the intention of the Susquehanna International Group, one of the largest trading companies in the world, based in Philadelphia, Pennsylvania, which has long been involved in trading in options, ETF and other securities, to expand the scope of its services in the near future to include trade in crypto assets, first by adding Bitcoin futures, and then by offering the opportunity to purchase and sell various digital assets. The newspaper reported that: “The parent company of the New York Stock Exchange, the Intercontinental Exchange, has been in talks about opening a subsidiary for cryptocurrency trading, and Goldman Sachs is on the verge of opening its own trading operation.”
BitMEX has added a listing of EOS futures.
The impact of Bitcoin futures on the price of the cryptocurrency is unclear. It wasn’t that long ago, December 2017, when the first Bitcoin futures appeared and began to be traded on the Chicago Board Options Exchange (CBOE), leading at first to a frenzy of trading and the headlong growth of the price of the cryptocurrency. However, as early as January 2018 several experts were naming the closing of the first bitcoin futures contracts on the CBOE as a possible reason for the collapse of the cryptocurrency market.
Over the past six months quite a few exchanges have included futures for key cryptocurrencies (BTC and ETH) in their listings. The next stage in the development of crypto trading is the creation of exchange-traded funds (ETF) tied to cryptocurrencies. Some companies were thinking about this as early as 2017. As reported by the Wall Street Journal, last week (June 6) two New York-based companies, VanEck and SolidX, which had already attempted to receive a permit from the Securities Exchange Commission (SEC) in the past to open over-the-counter bitcoin investment funds, submitted a joint application on the launch of a regulated cryptocurrency ETF.
Another major company, Fidelity Investments, which manages assets worth $2.5 trillion, plans to create a cryptoexchange. According to company representatives, this will allow Fidelity to compete with cryptoexchanges such as Coinbase, Kraken, Bitfinex and the brokerage company Robinhood.
On the one hand, there are fears that the arrival of major players on the cryptocurrency market will solidify the status of Bitcoin as a speculative trading asset that can partly perform the functions of gold, but also has a number of advantages connected with ease of transfer and storage. On the other hand, cryptocurrencies have a chance to occupy an important place in the payment system and perform some of the functions of money (a medium of exchange, means of payment, measure of value, world currencies) through their use in transfers and payments.
The functions of the two leaders on the cryptocurrency market (BTC and ETH) are determined by their utility. If the utility of Bitcoin is seen mainly in the promotion of payments and settlements, and to a certain extent as a measure of value for other cryptocurrencies, the value of Ethereum is determined by the created ecosystem and the set of management tools for a huge number of tokens. Over the past six months there has been a certain rotation in the top 10 cryptocurrencies, but the primacy of the two leaders is apparent. However, the structure of dominance on the cryptocurrency market may change, since Ethereum is backed by the unity of the Ethereum Alliance and the utility of the network. The value of Ethereum may grow significantly if, as Vitalik Buterin promised, the cryptocurrency can support more than one million transactions per second.
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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