The cryptocurrency market is huge, reaching a market capitalisation of almost $800 billion in January 2018. While this was the market’s peak capitalisation, it is still a major segment, as there are over 2,000 cryptocurrencies. BlockchainDefender recently decided to take a closer look at how a lack of trust is impacting the global market capitalisation of the cryptocurrency industry.
Goals of the Report
In the opening Executive Summary of the BlockchainDefender report, the team outlines the specific questions the report hopes to answer. There are three studies; the first study looks at how market sentiment impacts the market capitalisation of a cryptocurrency. It also aims to look at the established digital currencies with the best and worst online reputations, and variations in sentiment by region or country. Finally, this study looks at where negative content is most commonly published.
The second study in the BlockchainDefender report aims to compare the online reputations of traditional exchanges and crypto exchanges.
The third and final study focuses on the impact of a crisis on a cryptocurrency’s price.
Study One Results
The first study within the BlockchainDefender report has unsurprising results, indicating a clear correlation between increased negative online sentiment towards cryptocurrencies and a drop in market capitalisation. The opposite is also true, with increased positive online sentiment and search volume resulting in an increase in market capitalisation.
In terms of reputational variations by country, the US has the highest count of negative content regarding cryptocurrencies of the four countries analysed. This is followed by Germany, the United Arab Emirates and Japan. This negativity frequently comes from websites dedicated to crypto news, blogs, social media, discussion forums, and crypto review websites.
Study one also looks specifically at Bitcoin. Of the four countries previously mentioned, BlockchainDefender found the most positive search results for Bitcoin in the UAE and the most negative results in the U.S.
Of all cryptocurrencies analysed in the report, Iconomi had the most positive results, while Bitcoin Cash had the most negative.
Study Two Results
The second study found that traditional exchanges have a solid grasp on their reputation management. Additionally, these exchanges control as much as 34.38% of online content. By contrast, cryptocurrency exchanges only own 17.75% of online content, making it more challenging for them to control their online reputations.
Study Three Results
The final study in the BlockchainDefender report looks at figures from a specific cryptocurrency that faced a hacking crisis in 2018. A drop in market capitalisation and price was unsurprising, but the specifics of the fall are still very interesting. Another interesting point is that the impact on the crypto’s reputation varied by region, with a higher impact in the West than the East.
View the BlockchainDefender crypto trust report on SlideShare or download the digital eBook version.