CoinGecko 2019 Q1 Cryptoasset Report

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This is the seventh cryptoasset report produced by CoinGecko covering the Quarter 1 of Year 2019. In this report, we summarize and highlight the market dynamics in the cryptoasset market such as: - Market capitalization growth, volume change, and price movement - Monthly highlights on various topics: --> MimbleWimble --> Initial Exchange Offering (IEO) --> Cosmos (ATOM) --> Lightning Network Torch - Decentralized application market summary - Ethereum Ecosystem Highlights Download the full report here: View all of CoinGecko's historical quarterly reports here:
  • 1. CoinGecko Quarterly Report for Q1 2019 Jan 2019
  • 2. Sze JinBobby Ong Table of Contents: FOUNDER’S NOTES 4 MARKET DYNAMICS 5 2 38ETHEREUM ECOSYSTEM HIGHLIGHTS JANUARY HIGHLIGHT: MIMBLEWIMBLE 10 Top-30 Rankings In Collaboration with: Market Overview Top-5 Coin Returns Top-30 Distribution FEBRUARY HIGHLIGHT: INITIAL EXCHANGE OFFERINGS 15 MARCH HIGHLIGHTS: COSMOS 20 NEW DECENTRALIZED APPS 32 30 Analysts: TJ Sim Darren Lau Daniel ChengDaryl Lau Kristian Kho
  • 3. Copyright © 2019 CoinGecko. All Rights Reserved. No part of this report is to be reproduced, copied, leased or howsoever used by the reader to provide advice to any other person or entity. All figures, charts and graphs are based on data extracted from (which are derived from third party sources) unless otherwise stated. Important Notice: While we have made every attempt to ensure our data and information are gleaned from reliable sources and presented in the most accurate manner, CoinGecko takes no responsibility for any errors or omissions, or for the analysis, reports and results as stated herein. All information in this report is provided "as is", with no guarantees of any kind, including without limitation, completeness, accuracy, and timeliness. All information stated herein reflects solely the opinion of CoinGecko as an aggregator of publicly available information, and does not in any manner constitute financial advice or other professional advice for which a licence is required. Nothing implied within this report should substitute the sound technical and business judgement of the reader who is advised to use discretion, conduct his/her own further checks, and seek professional advice before relying on any information herein. The presence of third party trademarks and brands herein does not indicate any association with or endorsement by CoinGecko of such third parties. 3
  • 4. 2018 was a tough year for most of us in the cryptoasset industry. After a year filled with declining crypto prices, most of us are hoping that 2019 will be better. In many regards, the first quarter of 2019 has not disappointed and we ended the quarter with Bitcoin touching $4,100. This is approximately 11% higher than what we started the year with although it is worth noting that it has been a relatively quiet quarter with not much price volatility. One major event that occured was Bitcoin celebrating its 10th year anniversary on 3 January 2019. This was a major milestone for Bitcoin and proves the resiliency of not just Satoshi’s creation but the cryptoasset industry as a whole. For this quarter’s report, we will be looking at major events that happened in January, February, and March. January saw the birth of Beam and Grin, two highly-anticipated, privacy-oriented coins based on the MimbleWimble proposal. Although both coins share the same MimbleWimble concept, both teams took vastly different approaches in implementing things. The market was more excited about the fair launch of Grin with significant interest among token funds in mining Grin. Founder’s Notes: Bobby Ong Co-founder TM Lee Co-founder 4 In February, we saw Binance reviving the ICO market and making Initial Exchange Offerings (IEO) popular. This started with the highly successful Bittorrent IEO which was sold out in under 15 minutes. This was followed quickly by the successful IEO of Fetch.AI and Celer. The success of Binance Launchpad has caught the attention of all the other major exchanges which are now also launching their own IEO. In March, the market was excited for the launch of Cosmos (ATOM), which promises to make blockchains interoperable. March also saw a lot of discussions surrounding exchanges’ fake trading volume. We at CoinGecko are actively working on providing our users with more data points to better evaluate exchanges’ liquidity. We will be releasing our proposal to improve transparency surrounding exchanges’ liquidity very soon and will be adding more features in the coming weeks to come. Till then, we are excited on the prospects of the second quarter and look forward to the summer which we hope finally arrive for all of us in the crypto industry.
  • 6. Q1 2019 has been a relatively stable quarter with not much price volatility. Total market capitalization increased at a steady rate and ended the quarter up 16%. Trading volume has been increasing but this is due to more exchanges being tracked. Also, a deeper look into fake reported trading volume by exchanges is required. +16.23% Market Dynamics: Q1 2019 Market Overview Quarterly Market Capitalization vs Transaction Volume Trade Vol. (USD) Mkt Cap (USD) Total Mkt Cap increase in Q1 2019 6
  • 7. Q1 2019 saw the top 5 coins performing well except XRP. LTC was up over 100% possibly in anticipation of the Litecoin Halving expected to happen on 7 August 2019. Market Dynamics: 2019 Returns of Top-5 Coins +8% +11% -11% +103% +66% Returns (%) 7 Performance of Top 5 Coins in Q1 2019
  • 8. -0.64%-2.66% Market Dynamics: 2019 Market Capitalization Distribution of Top-30 Coins -1.51% +1.03%-0.02% -0.24%-0.29% +1.23% 8 As other altcoins rise in price in Q1 2019, Bitcoin’s overall market dominance fell by 1.5%. BTC, XRP and ETH combined have lost nearly 5% in market dominance. With the exception of EOS and Litecoin, most of the other top-10 coins have seen a drop in their market capitalization dominance. By 31st March 2019, the top-10 coins comprised about 91% of the overall market capitalization.
  • 9. Market Dynamics: Historical Ranking for Top-30 Coins 9 Q4 2018 vs Q3 2018 Q3 2018 vs Q2 2018 Q2 2018 vs Q1 2018 Q1 2019 vs Q4 2018 Q1 Largest Gainers Q1 2019 saw three new entrants in the top 30 list.
  • 10. JANUARY HIGHLIGHT MimbleWimble _ 10
  • 11. MimbleWimble The Harry Potter Themed Privacy Protocol January saw the launch of Beam and Grin, two highly anticipated cryptocurrencies utilizing the MimbleWimble protocol. Historically, privacy requires additional layers in addition to core protocols, causing bloat and affecting scalability in various ways. Some also require additional computing power, making it impractical for regular use. MimbleWimble can be considered as an improvement over the current Bitcoin’s operating protocol, and is a serious contender for many privacy- centric cryptocurrencies. Mimblewimble garnered attention from several prominent crypto individuals even before the launch of Grin/Beam coins and its introduction somewhat resembles that of Satoshi. What happened? What’s the deal? Why the hype? All three terms - Mimblewimble, Grin & Beam peaked on Google trends and were at the peak of their popularity during mid-January 2019. MimbleWimble is a protocol that addresses privacy issue on a protocol level without any add-ons. 11
  • 12. Proves that no new coins are created, and transaction is valid. But everyone can see how much was sent. Now we add a blinding factor, (50): MimbleWimble combines several cryptographic innovations which allows a cryptocurrency to be private by default, without the need for any add-ons. Coupled with several other innovations that help reduce bloat, the blockchain can be kept extremely lightweight. A few examples of the innovations are: (i) CoinJoin, (ii) Cut-throughs and (iii) Confidential Transactions MimbleWimble is a Protocol MimbleWimble The Harry Potter Themed Privacy Protocol (ii) Cut-throughs (i) CoinJoin Using the Pedersen Commitment which manipulates mathematics in a clever & elegant manner, data (amount sent) can be verified without divulging any actual data to third-party observers. In very simplified mathematical terms: Check out our other Guides! With this, as long as both parties know the blinding factor they can easily find out the actual amount sent, while 3rd-party observers are unable to see how much has been transacted, but would be able to verify that it is a valid transaction. Imagine a series of transactions where Alice, Bob and Tom sends money to one another and as a result generating multiple inputs and outputs that takes up space - which is what happens in Bitcoin. MimbleWimble’s Cut-through aggregates it all to just 1 input & output, translating to a smaller blockchain size & better scalability. CoinJoin combines input/outputs of transactions and as a result, obfuscates the sender/recipient making it difficult for a 3rd party observer to see who sent what. (iii) Confidential Transactions BEAM Intro Grin - Core Wallet Grin - Wallet 713 Grin - FAQ Mining Grin - Bminer Mining Grin - GGM 12 2 + 2 = 4 ; 2 + 2 - 4 = 0 2 (50) + 2 (50) = 4(50)
  • 13. Two popular implementations of the Mimblewimble Protocol, Grin and Beam have vastly different ideologies and aims: MimbleWimble Who’s using it? Launch Date 3rd Jan 2019 (no ICO) 15th Jan 2019 (no ICO) Implementation - C++ Codebase - Second-layer solutions enabled (Atomic swaps, Time- locked transactions etc.) - Rust Codebase - No second layer solutions. Minimal & transactional focused. Ideology/Purpose Confidential store of value Inflationary, encouraged to use as a currency Governance & Funding Beam Foundation, funded by Beam Treasury Community-run, funded by donations Monetary Policy - 80% to Miners - 20% to Beam Treasury for first 5 years (After 5 years, 100% to Miners and 0% to Beam Treasury) 100% to Miners Mining Equihash - aims to block ASICs long term Cuckoo Cycle - GPU first, ASICs friendly ~1 year Block time/Supply 1 minute, ~263 million maximum supply 1 minute, infinite supply with 60 Grin per minute 13
  • 14. MimbleWimble is currently considered as a work-in-progress protocol - There is still a lot of work to be done! We’ll explore one of the most common questions when it comes to MimbleWimble - how does it fare against existing coins? Privacy: While scalability of MimbleWimble- coins appear to be superior, their privacy features are not as battle tested compared to the likes of Monero or Zcash who have been around for a longer time. Scalability: Monero & Zcash have each implemented their own scalability solutions, with more improvements to be considered in the near future. (1) (2) (3) MimbleWimble Versus other coins? 14 MONERO ZCash Beam/Grin Privacy Protocol Ring Signature / Confidential Transactions zk-SNARKs Mimblewimble Size per transaction ~3 kb(1) ~2 kb (Shielded)(2) ~0.22 kb(3) Additional Layer/ Computation required? Yes Yes, for zk-SNARKs computation No Scalability efforts (already implemented) Bulletproofs (approx 80% improvement from previous) Sapling Protocol - Improves shielded transaction performance - Future scalability plans 2nd-layer Solutions for speed/scalability Pending company’s recommendations 2nd-layer solutions, to be announced
  • 15. FEBRUARY HIGHLIGHT Initial Exchange Offerings (IEO) 15
  • 16. IEO vs ICO What’s the Difference? 16 Initial Exchange Offering (IEO) Initial Coin Offering (ICO) Token sale location Crowdsale counterparty Project Screening AML/KYC Marketing Exchange listing Exchange website Exchange Exchange will screen KYC-ed users of exchange Token issuer can tap on the exchange’s reach and users. Joint marketing with exchange. Immediate. Included in IEO fees Token issuer website Token issuer None Token issuer to KYC each participant Token issuer has to market to individual investors Not immediate. Listing fees to be negotiated with each exchange Initial Exchange Offerings (IEO) started becoming popular in February 2019. IEOs are different from ICOs in the following aspects:
  • 17. ● Token sale on 28 Jan 2019 (15:00 UTC) ● 59.4 billion out of 990 billion BTT tokens allocated for IEO sale on Binance Launchpad ● Supported Sale Sessions: ○ BNB (23.76 billion BTT), ○ TRX (35.64 billion BTT) ● Individual Cap: USD 20,000 ● Raised: USD 7.2 million ● BNB session sold out in 13m 25s ● TRX session sold out in 14m 41s Binance Launchpad A Platform for Initial Exchange Offerings 17 Binance Launchpad is Binance’s platform for conducting IEO. Binance’s first IEO of 2019 was Bittorrent, the highly anticipated token sale by TRON’s Justin Sun. The successful token sale of Bittorrent made IEOs popular and got other exchanges to also launch their IEO platforms. ● Token Sale on 25 Feb 2019 (14:00 UTC) ● 69.2 million out of 1.15 billion FET allocated for IEO sale on Binance Launchpad ● Supported Sale Session: BNB only ● Individual Cap: USD 3,000 ● Raised: USD 6 million ● Sold out in 22 seconds ● 24,000 Pre-Signed User Agreement ● 19,860 Submitted Buy Order ● 2,758 Received an Order ● Token Sale on 19 March 2019 (14:00 UTC) ● 597 million out of 10 billion CELR allocated for IEO sale on Binance Launchpad ● Supported Sale Session: BNB only ● Individual Cap: USD 1,500 Equivalent ● Raised: USD 4 million ● Sold out in 17 minutes ● 39,000 Submitted Buy Order ● 3,129 Received an Order
  • 18. IEO Price: USD 0.00012 Closing Price (31 Mar 2019): USD 0.00076393 ROI : 536% (5.3x) All Time High: USD 0.00125 All Time High ROI: 947% (9.4x) Initial Exchange Offering (IEO) Projects Launched on Binance 18 IEO Price: USD 0.0867 Closing Price (31 Mar 2019): USD 0.200191 ROI: 130.9% (1.3x) All Time High: USD 0.4719 All Time High ROI: 444% (4.4x) IEO Price: USD 0.0067 Closing Price (31 Mar 2019): USD 0.01963062 ROI: 192.99% (1.9x) All Time High: USD 0.0289 All Time High ROI: 332% (3.3x) IEO Price: $0.0867 IEO Price: $0.0067IEO Price: $0.00012
  • 19. PRIME ● Token sale on 26 Mar 2019 ● 1.5 billion out of 20 billion TOP tokens allocated for IEO ● IEO Price: USD 0.00177 ● 130,000 people participated ● 3,764 people were successful ● Three price limit rounds: ○ 0.000708 HT sold out in 7s ○ 0.000852 HT sold out in 5s ○ 0.001020 HT sold out in 7s ● ATH: USD 0.0351 (18.8x) ● Token sale on 3 Apr 2019 ● 600 million out of 10 billion TOP tokens allocated for IEO ● IEO Price: USD 0.006 ● Minimum purchase 180 USD ● Maximum purchase 3,600 USD ● ATH: USD 0.022 (2.6x) Raised USD 3.4 Million in 19s Raised USD 3.6 Million in 7s ● Token sale on 2 Apr 2019 ● 70m out of 283m VBK tokens allocated for IEO ● IEO Price: USD 0.10 ● Max purchase 20,000 USD ● Min purchase 10 USD ● 885 people were successful ● ATH: USD 0.3458 (3.4x) Raised USD 7 Million in 10.4s ● Token sale on 10 Apr 2019 ● 500 million out of 10 billion BLOC tokens allocated for IEO ● IEO Price: USD 0.005 ● Individual cap 1,000,000 BLOC ● Minimum purchase 100,000 BLOC ● ATH: USD 0.08999 (16.9x) Raised USD 2.5 Million in 1s Alternative IEO platforms: 19 Initial Exchange Offering (IEO) Alternative Platforms Jumpstart
  • 21. Cosmos - Internet of Blockchains What is Cosmos? Cosmos is a network of independent blockchains that can scale and interoperate with each other, much like the internet that we know today. Before Cosmos, blockchains were siloed, unable to communicate with each other and also required a lot of effort to build on. Cosmos aims to solve these with a new technical vision. Cosmos in 4 points Each blockchain that’s connected via Cosmos maintains its’ sovereignty, and are independent to form their own consensus. The Cosmos SDK provides the blockchain framework, allowing developers to focus on building the application. Provides vertical scalability (1 application per blockchain) and in the future, horizontal scalability (1 application, multi blockchain) 1 Blockchain interoperability 2 3 4Sovereignty Application Development Scalability 21 Different blockchains that are interoperable can be built on Cosmos. Non Tendermint-based chains can also be linked to Cosmos.
  • 22. Bitcoin What makes Cosmos special? Blockchain interoperability A blockchain can be considered to be comprised of 3 parts - Application, Consensus and Networking. What happens when everyone tries to build and run their own dApp on a Blockchain? Application, Consensus and Networking are all mixed together and you’d have to either fork or build right on top of it. It’s like everyone trying to run an application on one same computer with limited resources - it’ll be painful, slow and expensive to run. Cosmos enables separate blockchains to communicate with one another (blockchain interoperability) - it would be similar to everyone having their own computer with Cosmos as the ISP/relayer. It’s quite literally the Internet of Blockchains. 1 2 3 45 6 Infrastructure is limited and everyone competes for the same resource. 42 1 5 3 Cosmos Everyone has their infrastructure, and Cosmos helps with interoperability to create a network/ internet of blockchains. 22
  • 23. What is Cosmos? Inside Cosmos: Tendermint Core & Cosmos SDK The governing mechanism has two rules to limit an object from obtaining a reference to another object only through a preexisting chain of references. This limits the scope of malicious or unexpected interactions and increases the stability of the ecosystem. Forks will never be created if more than a third of the validators are honest. Users can be sure their transactions are final as soon as a block is created. Tendermint Core is a packaged solution that handles networking & consensus in a blockchain. Developers can fully focus on application development and integrate with the Tendermint core easily through Cosmos’s Application Blockchain Interface (ABCI). Application themselves define their validator set constitution with full control. An ecosystem of modules allows developers to easily spin up application-specific blockchains without having to code from scratch. Tendermint Core Cosmos SDK Network & Consensus Engine Instant Finality Object Capability Security Modularity 23
  • 24. Java, C++, Go etc. Cosmos’s Communication Inter-Blockchain Communication Protocol (IBC) & Application Blockchain Interface (ABCI) Bonding When an IBC transfer is initiated, 10 ATOM tokens are locked up on chain A. Proof Relay Proof that 10 ATOM are bonded is relayed from chain A to chain B. Validation The proof is verified on chain B against chain A’s header. Once validated, 10 ATOM-vouchers are created on chain B. Tendermint based chains can interoperate (transfer value/data) using Cosmos’s IBC - a protocol that leverages on Tendermint’s instant finality property. Imagine trying to send 10 ATOM tokens from chain A to chain B: Inter-Blockchain Communication Applications have to be able to “speak” with the Tendermint Protocol in order to leverage on its networking and consensus layers. The Application Blockchain Interface (ABCI) allows that to happen, and supports any programming language. Consensus Networking Application Blockchain Interface > Tendermint based blockchains communicate via IBC. > Applications use ABCI to communicate with Tendermint Tendermint Core Engine Application Layer 24
  • 25. Q1 2019 HIGHLIGHT Lightning Network Torch _ 25
  • 26. Lightning Network is a "Layer 2" payment protocol that enables instant and low cost transactions between participating nodes. This off-chain protocol is used to scale Bitcoin’s transaction capacity. The Lightning Network Trust Chain or the “Lightning Torch” is a social experiment started by Twitter user @hodlonaut on 19th January 2019 and is used to showcase Bitcoin’s Lightning Network capability. @hodlonaut started the chain by making a 100,000 satoshi payment to @fartface2000. Each subsequent user who receives the Lightning Torch adds 10,000 satoshi to the next person. 26 Lightning Network Trust Chain How it Began
  • 27. Sources: | Total Hops: 291 Total Unique Recipients: 281 27 Lightning Ne
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