Did not expect: the index of dominance of Bitcoin is 80 percent


2019-03-24 10:30:07




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There are a few clear to all parameters : price, number of coins in circulation and market capitalization. But there is also the index of dominance in the market, that is, the percentage of the total BTC market cap of all cryptocurrencies. Not so long ago we wrote that fell to three-month low. But is it really? As a rule, for the monitoring of this indicator analysts use statistics CoinMarketCap. Maybe the dominance of the market is more than the percentage?

According to the theory of John-Paul Torgersen, last week, this figure stood at 50 percent. However, such calculations are in fact not reflect the true market situation. He compared 100 cryptocurrencies in the list, on a logarithmic scale. But for more accurate calculations it is necessary to add a further level of liquidity and daily trading volume.

Source: Bitcoinist

For example, the market capitalization of some of the coins amounted to 0.1% in day-on-year. This can be an indicator of the pitfalls of the market or artificial market capitalization. Now the analyst decided to use Pareto rule of 80/20 and try to multiply the volume by the market capitalization.

Source: Bitcoinist

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The Deletion of the statistics minor coins with presumably artificial capitalization and re-calculating the index of dominance of Bitcoin, he got a new figure to 80 percent. Applying the same formula to the top 5 coins, he found that the dominance of the main cryptocurrency at all is 85 percent.

However, to bury a metric of market dominance on CoinMarketCap still not worth it. It is still useful, but it would be better to rename it to «percentage of the market capitalization of».

The More data you look at . The current rate of coins can be found in our .


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