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Offline jonasmeyer

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An attempt to quantify actual altcoin market shares
« on: January 22, 2015, 11:53:19 AM »

I don't know if anyone on this board also tracks these numbers (and sadly, I haven't found a good source online for charts, so I would appreciate it if someone could post one or create one).  However, I have been tracking the relative market share of the Bitcoin market cap vs. the total crypto market cap since around Jan 2014. Interestingly, despite a change in value of over 75% since the peak, the market share of Bitcoin has remained remarkably stable. I've been tracking this on coinmarketcap.com, and just plugging it into a calculator to divide it out.

Other altcoins, not so much. There has been a lot of movement in the altcoin space up and down the rankings for second place and below, as I'm sure everyone on this board is keenly aware.

So per my numbers, which sadly I did not record in any systematic way, Bitcoin had around 90% market share, with daily volitility of less than 0.01%. You read that right. It seems that the market is very uncertain about the proper pricing of cryptocurrencies / cryptocommodities in general, but believes that the value of Bitcoin within that market is very stable. Bitshares and the rest have been competing over the remaining 10%, and there has been a fair amount of movement in this space, although Bitshares is also an island of stability here. This is good, in that we aren't really losing market share, but it is bad, because we aren't really gaining it much beyond the initial push.

However, recently, Bitcoin dropped to 80%, and has continued to be very stable after this sudden jump. This happened around the same time that Ripple "inflated" their distribution numbers, but they didn't inflate them by enough to account for the whole difference, so I'm confused.

I'd like to put out a call for real data. Let's track our market share over time. Specifically, I'd like to track the ACTUAL amount of XRP that has been distributed to the market, not the fake number that includes their "agreements to distribute" or whatever marketing speak they are calling it. There is good data on Bitcoin, but I'd also like to see the data on Bitshares. We can ignore Litecoin as a dead man walking with no real compelling use case other than laundering money back and forth between Bitcoin and Litecoin for obfuscation purposes. Similarly we can ignore PayCoin as an obvious scam, and all the other ones are too small to really make a difference in the numbers. (Plus, Stellar has way too little actual distribution for the market to price it correctly, and DogeCoin has hitched its wagon to Litecoin's fading star).

1) Can anyone point me to data on a "GINI coefficient for XRP" or wealth distribution or similar for XRP?
2) Can any point me to similar data on BitShares?

I will come back with fun graphs in exchange.

Thanks!

Offline bytemaster

Re: An attempt to quantify actual altcoin market shares
« Reply #1 on: January 22, 2015, 01:32:01 PM »
I think you should have a more objective measure.  Excluding major cryptos such as ltc stellar and even pay coin simply because we don't know why the market values them will skew the fact that they compete for capital in our market today. 
For the latest updates checkout my blog: http://bytemaster.bitshares.org
Anything said on these forums does not constitute an intent to create a legal obligation or contract between myself and anyone else.   These are merely my opinions and I reserve the right to change them at any time.

Offline jonasmeyer

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Re: An attempt to quantify actual altcoin market shares
« Reply #2 on: January 22, 2015, 01:44:30 PM »
Rereading my original post, I think I wasn't clear. Sorry!

I am looking for wealth distribution data on Bitshares, and Ripple. Then we can use that data to get a more accurate (less inflated) measure of the market share of those Bitcoin, Bitshares, and Ripple based on their actual liquid supply. Paycoin and Litecoin and similar will be counted as part of the general market, but they will not tend to move the denominator much, because they are pretty small. Of course more data is better. If anyone has a wealth distribution analysis of Paycoin, Litecoin, Nxt, etc etc I would welcome it and we could get much more accurate data.

I am just very suspicious that the market cap of Ripple in particular is being inflated by hundreds of millions of dollars by using weasel wording around which XRP has actually been "distributed". This caused a discontinuity in Bitcoin's market share, but it also may be the case that Ripple is actually lower than Bitshares on the rankings.

Any pointers to wealth distribution data are welcome!

Offline davidpbrown

Re: An attempt to quantify actual altcoin market shares
« Reply #3 on: January 22, 2015, 01:47:44 PM »
I'm not sure the value of comparing market caps. As you're beginning to wonder, some are not what they seem; others like I expect Bitcoin are closer to the mark. I could create a billion coins and sell one to myself for $1 and find a market cap of $1 Billion but would your graphs tell you anything for all the jump that created? Knowing the real value in the market, is a sum of knowing the real investment in each currency.

Obviously, the whole basis of any currency is confidence that tomorrow they will have value; so, perhaps market cap is useful only for stable currencies. Perhaps choose a set of stable coins and you might find something worthwhile. I'm not sure XRP is one of those.. XRP is not to be valued. Not wanting to knock Ripple but XRP is not meant to have value in the same way as others.. it's just the water in which remittances float, total XRP only needs as much value as is being transmitted at one moment.. rather over valued atm imho.

Also, when considering BitShares, you might want to consider the total asset values too.. bitUSD perhaps is one market cap that does suggest something more than Bitcoin even?
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Offline jonasmeyer

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Re: An attempt to quantify actual altcoin market shares
« Reply #4 on: January 22, 2015, 02:01:51 PM »
@davidpbrown, this is exactly my point.

Comparing market caps naively is bad. However, to continue with your example, if you make your crapcoin with 1 billion units and sell one of them for 1 dollar and keep the rest, then wealth distribution analysis will point out that you own most of the coins and there is only 1 that is liquid.

Therefore, we would correctly value your crapcoin at $1 (latest price * number of liquid coins). Obviously there is some judgement involved with what is "liquid". I think Ripple is (pardon the pun) capitalizing on this grey area by calling some XRP distributed that isn't really, and we can see that in the discontinuity in the market shares of the coins. I'm attempting to untangle their weaselly marketing.

So again, does no one have data on wealth distribution data on XRP and BTS?

Offline jonasmeyer

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Re: An attempt to quantify actual altcoin market shares
« Reply #5 on: January 22, 2015, 04:15:04 PM »
So, per this thread, https://stellartalk.org/topic/4604-ripple-labs-guys-are-showing-their-muscles-jumped-100-million-in-marketcap/ it appears that one should subtract 20B ish from the actual amount of XRP in general distribution. If this is true, then Ripple's true market cap is more close to $182,000,000.

If that is true, then Bitcoin's market share today is 87.7%. Control for paycoin, and it is up to 88.4%.

That would suggest that Bitcoin has lost a couple percentage points, but nothing serious, which means that the title of Crypto 2.0 is still up for grabs. Ripple does appear to genuinely be in the lead, though. Meanwhile Bitshares distribution is on bitsharesblocks, and it would appear to be a fairly standard long tail, with 90% of all BTS owned by around 8K addresses. TITAN obfuscates who really owns what, but we can speculate that the distribution is probably pretty similar to Bitcoin.

Offline Empirical1.1

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Re: An attempt to quantify actual altcoin market shares
« Reply #6 on: January 22, 2015, 04:58:28 PM »
The only thing I've found interesting along this line of thought is the alt-coin market share of POW (Excl. Bitcoin) over time. I suspect you'll see POW is in constant decline in alt-coin market share.

The information this gives me is that POW is being potentially proved inefficient/sub-optimal by the market & therefore even Bitcoin will likely be replaced.

I also think you'll find DPOS moving further ahead of POS in 2015 too.

Due to the centralized nature of Ripple and XRP, I don't think it's a potential Bitcoin replacement.

So I think an alt-coin market share analysis will point to the fall of POW and the rise of DPOS which will ultimately affect even Bitcoin, the last surviving POW in the top 5 soon enough, and so point to BitShares as the current most likely replacement.






« Last Edit: January 22, 2015, 05:07:04 PM by Empirical1.1 »

 

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