The cryptocurrency market has been on an up and down rollercoaster recently. Many investors attribute the growth spurts to the fact that the Chinese government has placed blockchain technology at the core of its technological development. In this fourth edition of our 2019 Report on the Top 30 Cryptocurrencies by Market Capitalization, PAData will be looking into this hypothesis as well as answering some key questions. How have the major cryptocurrencies been performing? How have Chinese government policies impacted the market?
We have gathered data on the top 30 cryptocurrencies from between September 1st and November 18th. In our previous three reports, PAData delved into such phenomena as how MKR was able to take off in a bear market even before DeFi had become widespread; how, excluding stablecoins, Bitcoin managed to be the least volatile cryptocurrency even in a bull market; and how the price of exchange platform tokens were able to rise despite falling market trends.
No New Players Break Into the Top 30. Public Blockhains Still Shine
The first thing that stood out when collecting data was that there were no new entrants to our list. In our two previous reports, we found that each time the market was in a bullish state, an average of three new cryptocurrencies found their way into the list. In other words, an average of six new cryptocurrencies entered the list every six months, a turnover rate of roughly 20%. This time around, however, even if we broaden our scope to include the top 100, there would still only be 27 new names on the list. This not only emphasizes the Matthew Effect in the market, but also shows how extremely difficult it is for long-tail cryptocurrencies to gain a share of the market.
Not only are there no newcomers to the list, the rankings of the top 30 cryptocurrencies have also remained largely unchanged compared to previous periods. Seven of the cryptocurrencies held their same position, 13 climbed up in the ranking, and ten fell.
The two cryptocurrencies that made the largest jump are Chainlink's token, LINK, and public blockchain VeChain's token, VET, each climbing seven positions. LINK rose from 21st place to 14th place and VET from 34th to 27th place. VET has not done this well since June of this year. Also noteworthy is that Cosmos’ blockchain token, ATOM, moved up five positions to number 20 after previously falling 10 spots. And after going missing from the list for nearly six months, BAT, web browser Brave’s token, returned to the top 30, moving up 4 spots to 29th. This comes after Brave's October release of their user report claiming 8 million monthly active users
BNB, LEO, and HT all made a very solid showing in our previous report, however, this time around they fell to 8th, 15th, and 16th place respectively. Dash, a privacy coin, and ETC, a public blockchain token both fell six positions to 22nd and 23rd respectively. NEM’s blockchain token, XEM, fell four positions to 28th.
Other cryptocurrencies which moved up or down on the list, if at all, only did so by one or two positions.
We found that if we look at the different types of cryptocurrencies on the list, it is primarily dominated by public blockchain tokens and payment tokens. The number of spots claimed by public blockchain tokens, payment tokens, platform tokens, stablecoins, and middleware tokens remained the same as in our previous report. Privacy coin Zcash, however, fell out of the top 30 and BAT returned to the list as the sole application token. The two privacy coins remaining on the list are XMR and Dash.
Total Market Capitalization Grew In the Last 30 Days. Public Blockchain Tokens as Much as 122%!
Total market cap of the top 30 tokens has fallen since September. As of October 18, total market cap was $206.79 billion, a decrease of 20.37% from the previous month, the largest monthly decrease since June. Over the past 30 days however, thanks to the Bitcoin comeback which began at the end of October, total market cap bounced back slightly in November. As of November 18, market cap had risen to $216.26 billion, a slight increase of 4.58% over the previous month.
Looking at the respective percentage of total market cap held by each of the top 30, we can see that Bitcoin’s dominance has somewhat faded. According to statistics, Bitcoin accounted for 70.47% of market cap on September 18, 69.40% on October 18, and 69.37% by November 18.
This is in stark contrast to what we found in our previous report. Between June and August, even though the total market cap of the top 30 cryptocurrencies decreased, Bitcoin's percentage of market cap steadily increased from 65.56% in June to 72.42% in August. What this shows is that the mild bull state of the market at the time actually fueled the Matthew Effect, strengthening Bitcoin’s control of the market. However, the current sideways market has provided other types of cryptocurrencies with the opportunity to grow, much like public blockchain tokens did during the period of this report.
Over the past 30 days, market cap growth of the top 30 cryptocurrencies grew an average of roughly 16%. The only tokens which experienced a decline were XRP, LEO, IOTA, DASH, USDC, XEM, and DOGE.
You can see that XRP and USDC experienced the largest drop of 13.23% and 5.67% respectively. It is worth noting though that USDC’s drop over the past 30 days may simply be a correction of its growth in late September and early October. Some veteran investors, however, believe it is because a large proportion of retail traders are taking long positions, therefore, market makers have to push down the prices to shake out the bulls. Moreover, Funding Wallet 1 has recently deposited large amounts of XRP into various exchanges.
The fact that USDC’s market cap has shrunk while the market cap of two other stablecoins has grown (USDT and PAX) may be an indicator of the fierce competition that USDC is facing.
Among the 23 cryptocurrencies which experienced market cap growth, one stood out among the rest. Over the past 30 days, VET's market cap grew 122.05%. In other words, VET more than doubled its market cap in just one month. NEO and ONT, two other well-known Chinese cryptocurrencies, grew 61.06% and 48.14% respectively over the past 30 days.
Cryptocurrency Prices Have Risen an Average of 15% Over the Past 30 Days. Public Blockchain Tokens are All the Hype!
Prices of the top 30 cryptocurrencies have risen an average of 15% over the past 30 days. Public blockchain tokens have performed particularly well, especially Chinese public blockchain tokens. The prices of VET, NEO, and ONT grew by 122.02%, 61.01%, and 30.70% respectively, substantially higher than the top 30 average. XTZ, ATOM, and ADA, also public blockchain tokens, grew by 40.12%, 32%, and 15.05% respectively.
Why did public blockchain tokens perform so well during this period? Theoretically, the core value of public blockchain tokens comes from the technologies that power the blockchains. So, can it be said that technological breakthroughs are responsible for the rapid price rises?
PAData gathered some statistics of 10 Chinese cryptocurrencies: VeChain, NEO, Ontology, Tron, Qtum, Bytom, GXChain, IOST, Nebulas and NULS. Of these, only Tron, NEO, and Qtum had over 10 active blockchain developers working on their blockchains over the past 30 days. In fact, VeChain, NULS, Nebulas, and GXChain each only had one.
Not only were there a small number of developers active on these chains, the amount of master document commits was very low as well. Tron had 110 master document commits over the past 30 days, the most among these 10 cryptos. Bytom, IOST, and VeChain each had less than 10 during the same period, and GXChain and NULS had none. Qtum, NEO, and Tron added and deleted the most content from their master documents, the other Chinese public blockchains, however, added and removed very little from their master documents.
In other words, the level of development activity among these Chinese public blockchains was quite low over the past 30 days, as was the case in August as well. This is to say that credit for the price rise of these Chinese public blockchain tokens can’t be given to their technological advancements. Instead, they have been positively impacted by measures implemented by the Chinese government. Market figures show that the Chinese government's decision at the end of October to spur the development of blockchain technology has had the greatest impact on public blockchains.
Another interesting point is that since June, the daily volatility rate of the top 30 cryptocurrencies has held steady at around 5%. This was the case in previous months when market cap and prices were decreasing, and it has been the case more recently as market cap and prices have increased.
Excluding stablecoins, LEO has the lowest volatility of 2.54% followed by Bitcoin at 3.47%. VET, XTZ, ONT, NEO, and BSV had the highest volatility rates at 10.02%, 9.66%, 9.24%, 8.13%, and 7.9% respectively. At the same time, the prices of these experienced the largest growth over the last 30 days, highlighting the fact that the rise in prices is not due to the development of blockchain technology and is instead the result of hype among traders.