The cryptocommunity has been criticizing market capitalization for a long time and thus also the website Coinmarketcap. To give a different view on prices, Coinmarketbook.cc wants to rate cryptocurrencies differently.
Market capitalization in the criticism
Most of the Crypto analytical web pages only care about market capitalization. It usually measures the dollar value of a coin in the amount of coins multiplied by the average price that is traded on the stock exchanges. This makes sense at first glance, as it reflects the supply and demand of the market in the purchase price. Bitcoin is ranked first with a market capitalization of $ 66.7 billion. This is calculated from the average price for a Bitcoin of $ 3,836 multiplied by the currently issued amount of approximately 17.4 million Bitcoins.
While it makes little difference in Bitcoin’s place, whether one uses the purchase demand or the market capital for sorting, it looks in place 2 and 3 already different.
If you rank the ranking by market capitalization, Ripple (XRP) takes second place and Ethereum (ETH) third. However, if one observes the buying behavior, the “Buy Support”, on Coinmarketbook, one recognizes that here Ethereum slips into second place. Ripple, however, loses two places and finds himself in fourth place again. Unexpectedly, then a candidate from the midfield of the top-10 on Coinmarketcap pushes forward: EOS (EOS). With a buy support of 14.8 million, EOS takes third place on Coinmarketbook.
Free markets – free manipulation
The greatest freedom of cryptocurrencies is currently their biggest shadow: no or little regulation by external institutions. On the one hand, what secures complete freedom from state influence is, on the other hand, an input for market manipulation. This allows investors to raise or lower prices artificially with large amounts of coins. The Honest Coinmarketcap website, for example, assumes that the trading volumes of BTC and ETH could be inflated by up to 80 percent. Faked buy and sell orders can manipulate these metrics. Also, sales in your own pocket can simulate a trade where none has taken place.
So to expand your view and get a holistic understanding of the market situation, certainly worth a look at Coinmarketbook.
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