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A Different Look at Crypto Market and Top Assets, How Dominated Is It?

The 25 largest crypto markets comprise roughly 94.40% of the capitalization of the combined market cap.

With Bitcoin regaining market dominance of over two-thirds of the entire combined cryptocurrency capitalization, discussions regarding market share of prominent altcoins have largely left the dominant cryptocurrency discourse. Here is a different outlook on the market and on how the top cryptocurrencies stack up with the rest.

Market dominance flows from alts to BTC since 2018

Market dominance between the top cryptocurrencies by market capitalization has changed over the last year. As of Aug. 19, 2018, as seen in the chart below, the three largest coins comprised 71.95% of the combined cryptocurrency market — an 8% difference to the figures seen now. Meanwhile, the top 15 cryptocurrencies of 2019 are still seeing more dominance than the top 20 of 2018, which represented 90.53%, and the top 25, which came to 91.53%.

Top crypto dominance over the rest of the market

One year ago, the 18 largest markets, comprising 1% of the 1,770 cryptocurrencies that were then-listed on CoinMarketCap, represented 89.85% of existing cryptocurrency wealth, while the remaining 99% comprised 10.15% — an 80% greater share than the 5.60% represented by 99% of the digital currency markets today. Compared with 12 months ago, the crypto markets show a redistribution of market dominance from altcoins back to Bitcoin (BTC), with the four largest altcoins among crypto assets posting the largest decline in market dominance. 

Currently, the four largest altcoins comprise 15.7% of the combined crypto market cap, a 42% drop from the 27.07% represented by the top four altcoins in August 2018. Additionally, the market share represented by the fifth- to the 14th-largest alternative cryptocurrencies has slipped from 9.85% of the total crypto value to 8.03%, while the 15th- to 24th-largest altcoins has fallen from 2.97% to 2.26%

BTC, ETH and XRP comprise 80% of combined crypto market cap

Bitcoin currently boasts a capitalization of roughly $179.55 billion, comprising 68.41% of the combined crypto capitalization of $262.45 billion. BTC’s market cap is up by 60% from $112,03 billion 12 months ago, with market dominance gaining by roughly one-third from 51.64%.

Roughly $21 billion worth of BTC changed hands during the previous 24 hours, comprising 33.02% of the combined cryptocurrency trade volume and ranking it as the second most traded crypto asset. 

Ether (ETH) is the second-largest market by capitalization, currently representing 7.55% of the combined crypto market cap with $19.80 billion. Ethereum’s market cap has fallen by 35% from $30.51 billion alongside a 46% drop in market dominance from 14.07%. During the last 24 hours, $7.88 billion worth of ETH was traded, ranking it as the third most traded cryptocurrency at 12.12% of all trades.

The third-largest market by capitalization, XRP, comprises 4.26% of the total combined capitalization, with a market cap of $11.18 billion. Year-over-year, XRP has posted a 17% drop in capitalization from $13.54 billion, and a 32% loss in market dominance from 6.24%.

Approximately $1.11 billion worth of XRP changed hands during the past 24 hours, representing 1.72% of all cryptocurrency trades and ranking XRP as the seventh most traded crypto asset. XRP is currently trading for roughly $0.26. 

The five largest altcoins represent 17% of total crypto value

Bitcoin Cash (BCH) is the fourth-largest crypto asset by capitalization, comprising 2.10% of the combined crypto market cap with $5.25 billion. In one year, BCH has shed 44% of its capitalization from $9,86 billion, while also posting a 54% drop in market dominance from 4.54%. In the last 24 hours, $1.81 billion worth of BCH changed hands, representing 2.74% of all trades and ranking it as the fifth most traded cryptocurrency. 

Litecoin (LTC) is currently ranked fifth by capitalization with $4.70 billion, comprising 1.62% of the total market cap of all cryptocurrencies. LTC’s market cap has increased by 40% from $3.36 billion over 12 months, alongside a roughly 4.50% increase in market share from 1.44%. Litecoin is the fourth most traded crypto asset, with a 24-hour trade volume of $3.18 billion, and with LTC pairings representing 4.92% of all cryptocurrency trades. 

Binance Coin (BNB) has a market cap of $4.25 billion, representing 1.62% of the total value of all cryptocurrencies and ranking it as the sixth-largest crypto asset. Among the top-15 crypto assets of by market cap, BNB is the strongest-gaining market of the past 12 months, ascending 11 rankings amid a 338% increase in capitalization from $970 million and a 260% gain in dominance from 0.45%. BNB is the 13th most traded market, with $294 million worth of Binance Coin changing hands during the past 24 hours, representing 0.45% of all crypto trades. 

BTC-USDT pairings account for 67% of all crypto trades

Tether (USDT) currently represents 1.55% of the combined cryptocurrency market cap, with a capitalization of $4.07 billion. Tether has gained one rank — from eighth to seventh — in the last 12 months, due to a 49% increase in market cap from $2.73 billion and a 24% increase in dominance from 1.25%. USDT is the most traded crypto asset, with a 24-hour volume of $21.6 billion. As such, USDT pairings represent 33.71% of cryptocurrency trades.

EOS is the eighth-largest cryptocurrency, representing 1.25% of the combined crypto market cap with a capitalization of roughly $3.29 billion. In 12 months, EOS has slipped three places from the fifth-ranked crypto asset amid a 31% drop in market cap from $4.81 billion alongside a 44% fall in dominance from 2.22%. 

Bitcoin SV (BSV) is the ninth-largest crypto asset with a market cap of $2.41 billion, comprising 0.92% of all cryptocurrency value. BSV is the 12th most traded cryptocurrency, representing 0.51% of all trades and with $330 million worth of BSV changing hands during the last 24 hours. 

Monero (XMR) currently ranks 10th by market cap, with a capitalization of $1.37 billion, comprising 0.52% of the combined cryptocurrency market cap. XMR has retained its ranking from 2018 despite a 15% drop in capitalization from $1.61 billion and a 30% drop in market dominance. 

Some altcoins have lost market share since 2018

Stellar’s Lumen (XLM) is the 11th-ranked crypto asset by market cap, representing 0.51% of cryptocurrency value with a capitalization of roughly $1.35 billion. In one year, XLM has fallen five places from sixth amid a 68% drop in market cap from $4,18 billion and a 73% loss of market share from 1.92%. 

Utility token Unus Sed Leo (LEO) comprises the 12th-largest crypto asset with a capitalization of roughly $1.21 billion. It was just launched in May 2019, equating to 0.46% of the combined cryptocurrency market cap. 

Cardano’s ADA currently posts a market cap of $1.18 billion, representing 0.45% of the combined cryptocurrency capitalization and ranking ADA as the 13th-largest digital asset. In 12 months, ADA has fallen four places from the ninth-largest crypto asset alongside a 56% drop in market cap from $2.66 billion and a 63% drop in dominance from 1.22%.

Tron’s TRX is the 14th-largest market, representing 0.43% of the combined cryptocurrency capitalization with a market cap of $1.13 billion. TRX has slid two places since ranking 12th one year ago amid a 23% drop in capitalization from $1.46 billion. TRX has also posted a 36% drop in market share from 0.67%. TRX is the 10th most traded crypto asset, with TRX pairings equalling $481.63 million in 24-hour trade volume.

Dash (DASH) comprises the 15th-largest crypto asset, representing 0.32% of the total crypto capitalization with a market cap of nearly $842.36 million. In 12 months, Dash has slipped one position, while posting a 34% drop from 1.28 billion and a 46% reduction in market dominance from 0.59%. Dash pairings equate 0.26% of all cryptocurrency trades, with a 24-hour trade volume of roughly $170.28 million.

BNB and LINK post strongest 12-month performance among top cryptos

Chainlink (LINK) is the 16th-largest crypto asset with a capitalization of $809.02 million, representing 0.31% of the combined cryptocurrency market cap. Of the top 25 cryptocurrencies by capitalization, Chainlink has posted the strongest performance since August 2018, gaining roughly 665% in market cap from $105.79 million alongside a 532% gain in dominance from nearly 0.05%.

The 17th-ranked cryptocurrency by market cap, Tezos (XTZ), represents 0.30% of cryptocurrency value with a capitalization of $780.90 million. Tezos has gained one rank in 12 months despite a 6% loss in market cap from $833.02 million and a 21% reduction in dominance from 0.38%. 

Neo (NEO) has a market dominance of 0.26%, ranking as the 18th-largest cryptocurrency with a capitalization of approximately $682.52 million. In one year, Neo has fallen three ranks from 15th to post a 46% drop in market cap from $1.27 billion and a 55% reduction in dominance from 0.58%. NEO is the 14th most-traded crypto asset, with Neo’s 24-hour trade volume of $294.80 million accounting for 0.44% of all cryptocurrency trades.

Iota’s MIOTA is the 19th-largest cryptocurrency, representing 0.25% of the combined crypto capitalization with a market cap of nearly $663,83 million. Since August 2018, MIOTA has fallen eight positions from the 11th-largest crypto asset amid a 56% slide in capitalization from $1.50 billion and a 64% drop in dominance from 0.69%. MIOTA is the 77th most traded cryptocurrency, with Iota’s 24-hour trade volume of $6.13 million.

Ethereum Classic (ETC) is the 20th-ranked crypto asset by market cap with a capitalization of $622.12 million, comprising 0.24% of the total value of the combined cryptocurrency markets. ETC has fallen seven positions from 13th alongside a 55% drop in capitalization from $1.39 billion and a 62.5% reduction in market share from 0.64%. ETC pairings represent 0.75% of all cryptocurrency trades, with ETC ranking as the ninth most traded digital asset with a 24-hour trade volume of $479.51 million.

The cryptocurrencies that are ranked 20-25 in the list (ATOM, XEM, MKR, USDC and CRO) represent 0.9% of the total cryptocurrency market value with a capitalization of just over $2,339 million. Their 24-hour trade volumes come to around $320 million.

Over 2,425 crypto markets represent less than 6% of total cap 

Of the 2,450 cryptocurrencies currently listed on CoinMarketCap, the 25 largest cryptocurrencies, comprising 1% of the total number of crypto assets, represent 94.40% of the combined value manifest in the total combined digital currency markets. As such, the remaining 99% of all crypto assets comprise just 5.60% of the total value currently manifested in the cryptocurrency markets.

One year ago, 99% of altcoins comprised over 10% of the entire crypto capitalization, signalling that many alternative cryptocurrencies have struggled to regain strength following the 2018 bear market. Further, the 10 largest altcoins have given approximately one-third of their market share back to BTC, dropping from 34% of the combined crypto capitalization to roughly 22% today.

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No Room for Monero, IOTA, Nano As Coinbase Explores New Digital Assets

Coinbase has announced its 2019 new digital assets support
shortlist. The listed eight lucky tokens might get onto one of the world’s
biggest crypto exchanges. Curiously missing and to the disappointment of many a
crypto enthusiast are IOTA, Nano, and Monero. Dash, Cosmos, Decred, Harmony,
Algorand, Waves, Matic and Ontology are however in the running for a Coinbase
listing.

The announcement made on the Coinbase blog, says:

“Coinbase’s goal is to offer support for all assets that meet our technical standards and which comply with applicable laws. Over time we expect our customers around the world will have access through Coinbase to at least 90 percent of the aggregate market cap of all digital assets in circulation”.

The exchange further adds that their evaluation is done against
their Digital Asset Framework. The major
considerations for listing include compliance and security. Besides, the
exchange also considers a token’s alignment with the exchange’s mission of
creating an open financial system
for the world.

Monero’s Rampant Crypto Jacking Woes

Monero’s privacy-focused cryptocurrency enables blockchain transactions that are both untraceable and anonymous. The proof-of-work consensus platform has, however, been accused of cloaking the identity of criminals. Monero has become the choice token for criminal activities.

The cryptocurrency has been increasingly blamed for crypto-jacking, whereby criminals access private devices and remotely mine crypto without the owner’s knowledge. In a report, Palo Alto Networks, an enterprise security company attributes 5 percent of all XMR in circulation to crypto jacking mining. The report further adds that Monero derives at least 2 percent of its hash power from crypto jacking scripts.

The digital currency and its ilk are currently banned from exchanges by Japan’s Financial Services Agency. Privacy coins are often at the forefront of the crypto regulatory discussion. It is highly probable that Coinbase has steered from listing XMR to avoid the regulatory hurdles.

Privacy tokens have received a lot of heat from law enforcement
authorities, being blamed for facilitating international money laundering. A
Norwegian real estate multi millionaire’s wife kidnappers have for instance
demanded a $10.3 million ransom in Monero. The investigators claim that if
Monero was not part of the payment plan, they would have less difficulty
tracing the criminals.

The US Department of Homeland Security has its eyes set on these
privacy coins. Should the crime levels rise, Monero may be banned in other
regions around the globe.

IOTA’s Coordinator
Trouble and Nano’s Controversy

While the problem of scalability hampers most blockchains, IOTA has found an innovative way around it. Through The Tangle, the blockchain can handle low-cost micro-transactions, unlike Ethereum or Bitcoin blockchains. Nevertheless, as innovative a blockchain as IOTA is, it has had some eyebrow-raising systemic flaws and scandals as well. It has had a range of technical errors, and episodes of poor PR management. In 2017, for instance, a team from Boston University and MIT investigated the IOTA hash function and found it vulnerable to attacks.

Nano’s first taste of infamy started with the hacking of the somewhat obscure Italian exchange BitGrail. At least 17 million units of Nano were lost, a $170 million loss for the exchange. The investigations pointed to unauthorized XRB transactions. The situation soured further when the Nano developer team and the exchange tussled and laid blame on each other on social media. It is possible that such poor press and accusations of insecure protocols could have made Coinbase wary of these tokens too.

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Bitcoin Falls Under $10,800 as US Stock Market Sees Minor Uptrend

Most of the top 20 cryptocurrencies are reporting significant losses on the day as Bitcoin falls under the $10,800 mark again.

Monday, June 17 — most of the top 20 cryptocurrencies are reporting significant losses on the day by press time, as Bitcoin (BTC) falls under the $10,800 mark again.

Market visualization courtesy of Coin360

Market visualization courtesy of Coin360

Bitcoin is currently down about 19.67% on the day, trading around $10,695 at press time, according to Coin360. Looking at its weekly chart, the coin is up 13.28%.

Bitcoin 7-day price chart

Bitcoin 7-day price chart. Source: Coin360

As Cointelegraph reported earlier today, Fundstrat Global Advisers Co-Founder Thomas Lee suggested that bitcoin’s volatility makes a long-term approach towards investing in it more appropriate for most traders.

Ether (ETH) is holding onto its position as the largest altcoin by market cap, which currently stands at $30.1 billion. The second-largest altcoin, Ripple’s XRP, has a market cap of $16.6 billion at press time.

Coin360 data shows that ETH has seen its value decrease by over 16% over the last 24 hours. At press time, ETH is trading around $292. On the week, the coin has also gained over 8.2% of value. 

Ether 7-day price chart

Ether 7-day price chart. Source: Coin360

XRP is down by about 17% over the last 24 hours and is currently trading at around $0.402. On the week, the coin is down about 8.2%.

XRP 7-day price chart

XRP 7-day price chart. Source: Coin360

As Cointelegraph reported earlier today, regulation technology startup Coinfirm will investigate how cryptocurrency Ripple is being used.

Among the top 20 cryptocurrencies, the ones who have reported the most notable losses are ethereum classic (ETC), and bitcoin sv (BSV), both over 21% down.

At press time, the total market capitalization of all cryptocurrencies is $307.6 billion, over 6.1% higher than the value it reported a week ago.

In traditional markets, the United States stock market is seeing slight gains so far today, with the S&P 500 up 0.51% and the Nasdaq up 0.74% at press time. The CBOE Volatility Index (VIX), on the other hand, has lost 2.04% on the day at press time.

Major oil futures and indexes are seeing discreet gains today, with WTI Crude down 0.05%, Brent Crude down 0.11% and Mars US up 1.22% at press time. The OPEC Basket is up 1.25% and the Canadian Crude Index has lost 0.12% over the 24 hours by press time, according to OilPrice.

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Alyx Fashion Brand Launches IOTA-Powered Pilot for Supply Chain Transparency

The luxe brand founded by former Lady Gaga creative director and Kanye West collaborator Matthew Williams is launching an IOTA-based pilot for supply chain transparency.

Alyx — the luxe fashion brand founded by erstwhile Lady Gaga creative director and Kanye West collaborator Matthew Williams — is launching an IOTA-based pilot for supply chain transparency. The news was reported by industry magazine Vogue Business on June 24.

Williams — who earned a 2016 LVMH Prize finalist nomination for his work at Alyx, and spearheaded brand partnerships with Moncler, Nike and Dior Men — has launched the blockchain pilot together with manufacturing giant Avery Dennison and London-based internet of things (IoT) software firm Evrythng.

As reported, IOTA is an IoT-focused distributed ledger technology firm, which has created an architecture dubbed “Tangle.” Unlike a blockchain, the Tangle protocol does not use “blocks” or mining, but is instead built upon a directed acyclic graph (DAG): a topologically ordered system in which different types of transactions run on different chains in the network simultaneously.

News of the pilot confirms earlier reports of a prospective collaboration between Alyx and IOTA.

For the pilot, nine Alyx pieces will reportedly feature a scannable QR-code that reveals the supply chain of the product — including the sourcing of its raw material, the garment’s place of manufacture, and shipping history.

Once Alyx suppliers have entered the relevant data, Evrything stores and uploads it onto the ledger, while Avery Dennison creates a digital ID tag for each unique garment, per the report.

While the pilot remains limited in its scope, Williams has reportedly told Vogue Business that his “north start goal” is to put the entire range of Alyx products onto the blockchain in a bid to promote transparency.

As Vogue Business notes, the fashion industry faces a considerable challenge bringing its supply chain data onto the blockchain given the wide array of materials and manufacturers that can be involved in the production of a unique garment.

Michael Colarossi — Avery Dennison’s vice president of innovation, product line management and sustainability — told the magazine that the key to making a blockchain solution scalable is to increase automation and to identify “the right nodes of the supply chain from where to pull data and then determining how to most efficiently extract that data.”

For Alyx, Williams told Vogue Business, blockchain implementation was relatively less complex, given the brand’s just four-year history and the fact that it produces 80% of its products with Italian suppliers who are committed to transparency. This latter point is important, the report notes, given that the system wholly depends on the accuracy of the input data.

This May, ConsenSys teamed up with French multinational luxury goods conglomerate LVMH and Microsoft to build a blockchain-powered platform that allows consumers to verify the authenticity of luxury products.

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Bitcoin Breaks $9,300 as US Stock Market Sees Minor Uptrend

Most of the top 20 cryptocurrencies are reporting moderate losses on the day as bitcoin breaks $9,300.

Monday, June 17 — most of the top 20 cryptocurrencies are reporting moderate losses on the day by press time, as bitcoin (BTC) passed the $9,300 mark again.

Market visualization courtesy of Coin360

Market visualization courtesy of Coin360

Bitcoin is currently up about 2.5% on the day, trading around $9,358 at press time, according to Coin360. Looking at its weekly chart, the coin is up around 12.7%.

Bitcoin 7-day price chart. Source: Coin360

Bitcoin 7-day price chart. Source: Coin360

Yesterday news broke that the Chicago Mercantile Exchange (CME) Group has released data showing that open interest in Bitcoin futures is rising.

Ether (ETH) is holding onto its position as the largest altcoin by market cap, which currently stands at just under $28.5 billion. The second-largest altcoin, Ripple’s XRP, has a market cap of $18 billion at press time.

Coin360 data shows that ETH has seen its value increase by a fraction of a percent over the last 24 hours. At press time, ETH is trading around $268. On the week, the coin has also gained over 2.2% of value.

Ether 7-day price chart. Source: Coin360

Ether 7-day price chart. Source: Coin360

XRP is down by about three quarters of a percent over the last 24 hours and is currently trading at around $0.428. On the week, the coin is up about 6%.

XRP 7-day price chart. Source: Coin360

XRP 7-day price chart. Source: Coin360

Among the top 20 cryptocurrencies, the only other ones who have seen gains are binance coin (BNB), which is about 3.8% up, and monero (XMR), which is about 2.5% up.

At press time, the total market capitalization of all cryptocurrencies is $288.8 billion, nearly 8.8% higher than the value it reported a week ago.

As Cointelegraph reported earlier today, Jerome Powell, the head of the United States Federal Reserve, has said that he recognizes both potential benefits and risks to Facebook’s recently-unveiled Libra cryptocurrency project.

In traditional markets, the United States stock market is seeing slight gains so far today, with the S&P 500 up 0.61% and the Nasdaq up 0.5% at press time. The CBOE Volatility Index (VIX), on the other hand, has gained 4.33% on the day at press time.

Major oil futures and indexes are seeing discreet gains today, with WTI Crude down 1.37%, Brent Crude down 1.37% and Mars US up 0.4% at press time. The OPEC Basket is up 0.82% and the Canadian Crude Index has not seen its value change in the 24 hours by press time, according to OilPrice.

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IOTA to Enter a New Partnership to Track Potentially Fatal Food Allergens With DLT

IOTA has partnered with digital food safety firm Primority to develop a tool to minimize the threat of potentially fatal food allergens.

Non-profit blockchain organization IOTA Foundation has teamed up with digital food safety management firm Primority to track food allergens via blockchain, IOTA tweeted on June 20.

The new partnership aims to reduce risks associated with potentially fatal food allergens, targeting 220 million people with food allergy worldwide, as IOTA noted in the tweet.

The collaboration includes the development of a prototype of an application that would enable consumers to check food products for allergens, particularly those that go under usual radars for a number of reasons, including cases when products share production lines with allergen-containing products, according to a blog post by IOTA.

Specifically, the application will be based on IOTA’s immutable distributed ledger protocol Tangle, and integrated with Primority’s 3iVerify platform, which will enable the information collected from manufacturers to be automatically shared on IOTA’s Tangle.

As such, the application will reportedly allow consumers to access a number of details about food products by scanning a barcode on the app. The shared information would include tracking of raw materials used and their suppliers, as well as a review of food production processes. As IOTA stressed in the announcement, consumers will be able to access the data “without sharing any personal, sensitive information, and without owning any cryptocurrency.”

Recently, Cointelegraph reported on collaboration between American seafood trade association National Fisheries Institute (NFI) and IBM’s blockchain-based supply chain solution Food Trust to trace seafood species.

In April, research firm Gartner predicted that as much as 20% of the top 10 global grocery suppliers will run using blockchain technology by 2025.

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Bitcoin Falls Near $9,000 as US Stock Market Sees Gains

Most of the top 20 cryptocurrencies are reporting moderate losses on the day as bitcoin descends back to $9,000.

Monday, June 17 — most of the top 20 cryptocurrencies are reporting moderate losses on the day by press time, as bitcoin (BTC) falls Near $9,000 mark again.

Market visualization courtesy of Coin360

Market visualization courtesy of Coin360

Bitcoin is currently down about 3% on the day, trading around $9,045 at press time, according to Coin360. Looking at its weekly chart, the coin is up around 11%.

Bitcoin 7-day price chart

Bitcoin 7-day price chart. Source: Coin360

As Cointelegraph reported earlier today, bitcoin surpassed one million daily active addresses on June 14, according to blockchain statistics website CoinMetrics.

Ether (ETH) is holding onto its position as the largest altcoin by market cap, which currently stands at $28.2 billion. The second-largest altcoin, Ripple’s XRP, has a market cap of $18.1 billion at press time.

Coin360 data shows that ETH has seen its value decrease by about 2.27% over the last 24 hours. At press time, ETH is trading around $265. On the week, the coin has also gained almost 6.8% of value.

Ether 7-day price chart

Ether 7-day price chart. Source: Coin360

XRP is down by just over 0.43% over the last 24 hours and is currently trading at around $0.430. On the week, the coin is up about 6.7%.

XRP 7-day price chart

XRP 7-day price chart. Source: Coin360

Yesterday news broke that major money transmission network MoneyGram has entered into a strategic partnership with blockchain-based payments firm Ripple.

Among the top 20 cryptocurrencies, the only ones reporting gains are binance coin (BNB), which is over 1% up, and DASH, which is up over 2%.

At press time, the total market capitalization of all cryptocurrencies is $282.8 billion, over 11.6% higher than the value it reported a week ago.

As Cointelegraph reported earlier today, Social media giant Facebook has released the white paper for its long-awaited cryptocurrency and blockchain-based financial infrastructure project.

In traditional markets, the United States stock market is seeing gains so far today, with the S&P 500 up 1.17% and the Nasdaq up 1.73% at press time. The CBOE Volatility Index (VIX), on the other hand, has lost 0.46% on the day at press time.

Major oil futures and indexes are mixed movements today, with WTI Crude up 3.99%, Brent Crude up 2.43% and Mars US down 0.83% at press time. The OPEC Basket is up 0.57% and the Canadian Crude Index has seen its value increase by 5.57% in the 24 hours by press time, according to OilPrice.

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Bitcoin Breaks $9,300 as US Stock Market Sees Minor Downturn

Most of the top 20 cryptocurrencies are reporting moderate gains on the day as bitcoin breaks $9,300.

Monday, June 17 — most of the top 20 cryptocurrencies are reporting moderate gains on the day by press time, as bitcoin (BTC) passed the $9,300 mark again.

Market visualization

Market visualization courtesy of Coin360

Bitcoin is currently up about 2.69% on the day, trading around $9,341 at press time, according to Coin360. Looking at its weekly chart, the coin is up around 18%.

Bitcoin 7-day price chart

Bitcoin 7-day price chart. Source: Coin360

As Cointelegraph reported earlier today, bitcoin surpassed one million daily active addresses on June 14, according to blockchain statistics website CoinMetrics.

Ether (ETH) is holding onto its position as the largest altcoin by market cap, which currently stands at just under $29.1 billion. The second-largest altcoin, Ripple’s XRP, has a market cap of $18.3 billion at press time.

Coin360 data shows that ETH has seen its value increase by about 1.5% over the last 24 hours. At press time, ETH is trading around $273. On the week, the coin has also gained over 15% of value.

Ether 7-day price chart

Ether 7-day price chart. Source: Coin360

XRP is up by just over 4.2% over the last 24 hours and is currently trading at around $0.435. On the week, the coin is down about 11.5%.

XRP 7-day price chart

XRP 7-day price chart. Source: Coin360

Among the top 20 cryptocurrencies, the only one reporting losses is iota (MIOTA), which is over 2% down.

At press time, the total market capitalization of all cryptocurrencies is $288 billion, nearly 15% higher than the value it reported a week ago.

Yesterday, it was reported that South American online marketplace Mercado Libre is working with Facebook on the social network’s secretive Libra cryptocurrency project.

In traditional markets, the United States stock market is seeing slight losses so far today, with the S&P 500 down 0.16% and the Nasdaq down 0.52% at press time. The CBOE Volatility Index (VIX), on the other hand, has gained 2.36% on the day at press time.

Major oil futures and indexes are seeing discreet gains today, with WTI Crude down 1.37%, Brent Crude down 1.37% and Mars US up 0.4% at press time. The OPEC Basket is up 0.82% and the Canadian Crude Index has not seen its value change in the 24 hours by press time, according to OilPrice.

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The Land of the Free: Why Decentralization Matters in the Crypto Republic

The success of Tezos’ self-amendment process and other recent events stress the relevance of the topic of governance in the crypto community.

On May 30, Tezos implemented the amendment Athens A, as the result of a voting process that involved its baker nodes (the Tezos equivalent of “miners”) from Feb. 28 to May 30.

Although the actual relevance of the upgrade was quite small (see below), the Tezos community underlines that the test was a milestone. The smooth shift to Athens A indeed demonstrated the capability of Tezos to evolve without forking, thanks to the features of proposal/selection/voting/test/implementation this blockchain itself encompasses.

On the very same day, another fast-growing young company backed by a cryptocurrency, Iota, announced an important step toward total decentralization, substituting its Coordinator mechanism with the new Coordicide tool.

Coordicide will perform the same functions of its predecessor, ensuring transaction security and preventing double spending. However, the new protocol will allow the peculiar Iota block creation process to work in a fully decentralized and permissionless manner.

The debate over what constitutes the most suitable approach to the exchange business and the declarations of some big companies about decentralized exchanges (DEX) — both for or against it — only add to the fact that the topic of decentralization is still a paramount concern as crypto involves more people and use cases.

The evolution of cryptocurrencies as a business increases the amount of interest it generates. As in any business, this involves issues relating to power distribution. But such questions are difficult to answer in a simplistic way.

Benevolent dictators

Bitcoin (BTC) defines itself as a peer-to-peer (p2p) network, as per the title of its white paper; the new electronic cash would work in a trustless manner — the 2008’s foundation document states — thanks to the consensus of the honest nodes that “control a majority of CPU power.”

The dream of money created by the people and for the people, freely circulating across the national borders, and untouchable by the rapacious economic monopolies was very appealing during the years following a dramatic financial crisis, which some may argue left the world suspicious toward governments and traditional financial actors.

However, while Bitcoin evolved from being a “cypherpunk” plaything to a relevant business entity, many concerns about its actual decentralization and “internal democracy” arose. In autumn 2016, for instance, two researchers — De Filippi from Harvard University and Loveluck from Université Paris-Saclay — published a paper that criticized the “highly centralized and undemocratic” technocratic approach to governance that, in their opinion, characterizes Bitcoin core developers.

Defining the small number of individuals in charge to decide which changes shall be incorporated into Bitcoin as a sort of “benevolent dictator,” the two researchers noticed:

“There exists, therefore, an obvious discrepancy between the libertarian vision of Bitcoin as a decentralised infrastructure that cannot be regulated by any third party institution, and the actual governance structure that dictates the technological development. […] While the (a)political dimension of the former has been praised or at least acknowledged by many, the latter has remained, for a long time, invisible to the public: the technical decisions to be taken by the Bitcoin developers were not presented as political decisions, and were therefore never debated as such.”

Additionally, Vitalik Buterin and Ethereum’s core team were labeled with the same title of “dictator” as a consequence of the decision to alter the mainchain to refund the victims of the DAO hack on June 2016.

The hack itself and the following debate between the supporters of Vitalik’s choice and the defenders of the inviolability of the blockchain stressed, as an article on Wired noticed then, how much human weaknesses were still influencing processes that, theoretically, are managed only by the impersonal rules of mathematics.

A similar dispute emerged once again in 2018 about the vote on the Ethereum Improvement Proposal (EIP-999), which aimed to unfreeze 587 multisig wallets attacked during the July 2017 Parity hack.

It is worth noting that the internal debates inside both the Bitcoin and Ethereum communities brought the first relevant cases of a direct democracy instrument being applied, which is allowed by the blockchain architecture itself.

Even if the process of development and amendment of the core software remains the privilege of a qualified technical elite, all the nodes taking part in the network can veto a piece of code, refusing to upgrade and forking the blockchain. Therefore, every miner has voting rights that are equal to the hashing power and, if a new alternative blockchain is born, the free and democratic rules of the market would determine which is the more successful coin.

This happened, for instance, in July 2016, when the integrity supporters divorced from the amended Ethereum mainchain, giving birth to Ethereum Classic (as well as a new coin, ETC). Similarly, in August and October 2017, when people became unsatisfied with the introduction of SegWit on the Bitcoin network, they tried to find a solution to the block’s dimensions issue, creating, respectively, Bitcoin Cash (BCH) and Bitcoin Gold (BTG).

Voting, pickaxe in hand

This dream made of equal rights and free competition, however, is troubled by severe concerns over the actual distribution of mining power that sustains the different blockchains based on proof-of-work (PoW).

When considering Bitcoin, for instance, it’s easy to understand the distance from its pioneer days and the present: On May 22, 2010, on the legendary first Pizza Day, the hash rate required to feed the whole network was about 109 MegaHash/s (MH/s), while eleven years after, on BTC Pizza Day 2019, the required computing power reached almost 52 ExaHash/s (51,934,800,000,000 MH/s).

Average daily hash rate on Pizza Day

While mining shifted from an amateurish activity to a capital-intensive business, the community has lost its role as a validator, which became much more of an exclusive prerogative of the giant mining pools that formed an oligopoly.

The data published by one of them show that, since April 2013, the three largest mining companies produced more than 50% of the blocks of the system (BTC Guild with 37.83%, SlushPool 11.54% and BitMinter 7.09%). The situation changed very little during the following years, despite the swirling turnover among the companies leading the industry.

The dynamic only seems to have scaled down in the very last few months; however, the dominance of the first three players (presently BTC.com, F2Pool and Poolin) is still above 40% of the blocks.

BTC Pool

Ethereum was born with specific features preventing ASIC-based mining. However, its algorithm could do nothing to limit a concentration of power, which is even more accentuated than in Bitcoin’s blockchain: Since the summer of 2017, two pools alone — Ethermine and SparkPool — produced over 50% of the new blocks almost continuously every month.

ETH Pool

Even if vicious behavior that could undermine the whole crypto economy is rather unlikely in the two leading blockchains, recent events involving the smaller ETC demonstrated that the possibility of a 51% attack is far from theoretical. Last January, the exchange Coinbase revealed evidence of an ETC blockchain reorganization, which included double spending worth over $1.1 million.

Give me liberty or give me scalability

Proof-of-stake (PoS) could contribute to answering the concerns surrounding the rise in concentration of power within the mining industry and the risk that a malicious super-miner could hijack a whole blockchain.

The critical feature of PoS is to bond the rights to validate the new blocks — to “vote” in cases of a fork — to facilitating a “lottery” influenced by the dimension of the stakes “frozen” in the nodes, instead of asking the validators to compete through computing power.

This would bring some advantages — considering the fee levels, transaction speed and ecological footprint — as PoS forging is less demanding than PoW mining in terms of fixed capital and energy involved. Besides, the broader adoption of PoS would disrupt the mining business model, undermining the oligopolistic position of the pools that are dominating the market now.

However, even if the shift toward PoS would theoretically bring immediate democratization in the way blockchain is being run, in a long-term perspective, it is somewhat unclear if and how forging business would avoid spiralling toward concentration and bringing it from individual geeks to giant multinational companies.

Delegate proof-of-stake (DPoS), on the other hand, makes even more explicit the issue of the internal governance and the trade-off existing between scalability and decentralization. This consensus algorithm began to work for the first time in Bitshares, the first blockchain project designed between 2014 and 2015 by Daniel Larimer, also the creator of Steemit and EOS.

Since then, the crypto community divided itself between those who equate Larimer to Satoshi Nakamoto and those who see DPoS as an unforgivable sin against the very nature of the blockchain.

Cryptocurrencies must rely on blockchains that could guarantee that transactions will be unique and irreversible. However, to reach this advisable degree of security, it seems inevitable that a choice has to be made between either a time-consuming solution that implies a broad and distributed consensus or more effective architectures, which achieve efficiency while harming system decentralization.

The so-called “scalability trilemma” was first coined by Buterin and Trent McConaghy to explain how difficult — if not impossible — it would be to attain scalability, decentralization and security, all at the same time.

Since security is a sine qua non for every blockchain and scalability is a goal determining the success of a cryptocurrency, decentralization looks to be the odd one out.

Scalability Trilemma

In DPoS, limiting the validation process to an elite group of nodes — empowered also by the stakes delegated by other members — would enhance the performance, guaranteeing both security (as malicious nodes would be sanctioned economically) and preventing unchallengeable power positions (as delegators could revoke their sustain if they disagree with the delegate’s policy).

The effectiveness and the actual match between this ideal model and its application could vary enormously from case to case, as everyone who lives in a country ruled by a representative parliamentary system would know.

Like in politics, criticism and scandals are commonplace in DPoS. Since its launch in June 2018, the largest DPoS/PoS currency existing on the market, EOS, has been plagued by recurrent embarrassments revolving around its governance model.

Decentralization doesn’t seem to be a top priority for many DPoS supporters, indeed. For instance, last May, Neo founder Da Hongfei declared in an interview during Consensus 2019 that the high level of centralization of his blockchain is part of a strategy to compete against Bitcoin and Ethereum, in terms of superior performance. Despite some openings to decentralization during the summer of 2018, the Neo Foundation is still controlling half of the supply of NEO coins and the majority of the nodes running the network. “That’s intentional. We want to keep it more efficient,” the Chinese entrepreneur said.

It’s then easy to understand why Buterin himself bluntly criticized EOS, Neo and other DPoS projects during his keynote at the last Blockchain Connect Conference in San Francisco on Jan. 11, 2019. In the same speech, Ethereum’s co-founder stated his support for options he defined as “good, legitimate ways to make a blockchain fast,” without harming decentralization.  

One possible solution to the problem of scalability would be the creation of a “second layer” network, that allows transactions to occur off-chain and then ultimately settle on-chain.

Only, this secondary network would require some forms of centralization or trusted players to keep the mainnet both safe and decentralized, despite a significant growth in the number and speed of the performed transactions.

This is the path by which the Lightning Network is experimenting on Bitcoin’s blockchain and what projects such as Plasma, Raiden, Counterfactual and Truebits aim to introduce into the Ethereum ecosystem.

Considering the “first layer,” Ethereum core developers have been working for a long time toward a more sophisticated solution. It encompasses both a new approach to PoS block validation, known as Casper, and the possibility for the network to operate through segmentation — called sharding — that allows every “island” of Ethereum to act as parallel blockchains, multiplying the performance of the system as a whole. The two development paths are presently joined under the label of Ethereum 2.0, the new spec of the cryptocurrency that is set to begin operating between 2020 and 2021.

Athenian democracy

Proof-of-stake is indeed quite similar to the original form of democracy deployed in Athens during the fifth century B.C. This form of government was based, in fact, not on a free election but on a draw that could appoint randomly selected citizen as magistrate or as delegates of the “people.” Fate was therefore the guarantor of equality (however, the city denied civil rights to women, slaves and foreigners).

Tezos’ blockchain defines its distinctive feature as the ability to self-amend and self-govern its code evolution. However, is it unclear if the choice to label its first amendment as “Athens” was referring more to the random, PoS-ish nature of the historical Greek democracy or to the allure of participating in a free debate, which the ancient republic earned in collective consciousness.

On Feb. 28, Paris-based developer team Nomadic Labs proposed the migration from the original protocol “alpha” to “Athens,” injecting the network with the hashes referring to two alternative code updates.

The reform marked a milestone when considering the process rather than the content: Athens A aimed to reduce the number of Tezos’ native tokens (XTZ) accounted in one “roll” (the unit of account for Tezos’ proof-of-stake) and to increase the gas limit for each block, while the Athens B proposal contained only the gas limit increase amendment.

As every new piece of code aiming to upgrade Tezos protocol, Athens charged a reward for the developers, if approved: The request was a symbolic amount, sufficient to pay for a round of beers for the team (100 XTZ, less than $150).

The Tezos Foundation explicitly chose not to vote or to vote “Pass” during the different phases of the pool, to avoid influencing the results.

During the first phase of the process, aiming to choose which proposal should undergo the voting, 170 bakers representing almost half of the XTZ on stake, decided to bring Athens A to the “Exploration Period.”

An even more significant number of participants (194 bakers, 87% of the stake) then expressed their opinion on the amendment, approving it and choosing to test Athens A in a sort of a “48-hours fork,” on a temporary parallel mainnet.  

A final round of voting was required after the test (involving 216 bakers, representing 84.3% of the stake) to allow for an automatic update to the new code for all the nodes, which activated Athens A after 12:40 a.m. UTC on May 30.

Tezos' voting breakdown

The high level of participation in the vote among the Tezos community is even more remarkable considering the recent failure of another experiment on direct involvement of token holders.

Jacob Arluck from Tocqueville Group explained in a post on Medium the significance of Athens and stressed that the voting was indeed just a part of a more comprehensive process aiming to activate the Tezos community as a whole:

“It’s really exciting because it’s the first step towards this idea of self-upgrading, decentralized, internet-native economic infrastructure.”

Social networks, web-based platforms, on-chain signaling tools and baker-promoted pools are some of the instruments that guaranteed — in a somewhat unplanned and “decentralized” fashion — the debate among bakers and the delegator token holders.

People opposed to the governance architecture seemed to have been the decisive factor and Tezos’ co-founder, Arthur Breitman, confirmed to Cointelegraph that the success of Athens relied on a mix of direct participation and the delegation mechanism:

“The fear of ‘voter apathy’ has permeated most discussions of on chain governance. Tezos guards against that issue by borrowing ideas from Gordon Tullock’s concept of liquid democracy. The massive participation in the Athens vote and high degree of engagement from the community shows that this approach seems to be working.”

With great power comes great responsibility

The case of Tezos’ amendment helps to focalize on the strong similarities between the debate about decentralization in blockchain and some well-established topics in sociology, economics and political science.

The dilemma of performance vs. decentralization, for instance, has strong analogies with the debate regarding the relationship between political freedom and economic development. Considering the diverging paths of different developing countries (recently, India and China), argue that autocracy could achieve higher performance than democracy, because it is not impaired by the need to mediate with the public opinion and different groups of interests.

Others, for instance, such as Nobel Prize winner Amartya Sen, believe that freedom is a part of the development process as its final aim, as an instrument to check its advancement and as a guiding light to define its direction. Professor Sen also recognizes, however, that real freedom means more than regular formal pools, and it is possible to transfer his concern for genuine political participation to the blockchain-related issues presented above.

The effort that the Tezos community demonstrated in its first election is indeed quite similar to that of many opinion groups that try to resist “political laziness,” which affects many large democratic countries nowadays (Breitman reference to Tullock’s article was not accidental).

It is, however, unpredictable if it would be possible to reach such a high degree of involvement in a broader and more mature network. Bitcoin PoW mining too was somehow a democratic activity when nodes were in the hundreds; the real issue arises when the number of users surpasses the number of people directly involved in system development.

Widespread adoption is likely to flood the system with users who are more concerned with issues like transaction cost and speed, user-friendly applications and global acceptance as a means of payment rather than obscure topics like 51% attacks or the scalability trilemma.

It is even possible that the average user could freely choose to renounce a significant amount of the libertarian features that have defined cryptocurrencies since their origin, for the sake of more comfortable handling.

In 1576, the French political philosopher Étienne de La Boétie clandestinely published his “Discourse on Voluntary Servitude.” The text explained that tyrants (La Boétie also put elected governors among them) could retain their overwhelming power over their subjects because the people themselves forfeit their original freedom.

More than violence and intimidation, the French thinker argued that the real causes that brought the majority to accept servitude were the desire for profit and the custom of servitude itself.

Even without calling it real “servitude,” nowadays, we are still undoubtedly living in a centralized world, among centralized institutions and using everyday centralized technologies we don’t completely understand. It is therefore quite hard that a new frame of mind, more suited to handle the power and the responsibility coming with decentralization, could arise overnight.

It is almost impossible to design a perfect voting system that, just using a set of rules, could force people to take responsibility for their freedom, limit media brainwash and prevent bribery. So, it seems quite unlikely that technology alone could assure the cryptocurrencies reach true decentralization under every possible scenario.

It is impossible to know which answer to the issue of blockchain governance will become dominant in the future; however, it is plausible that the fundamentals of human behavior will be part of it, alongside mathematics.

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Bitcoin Drops Below $8K, Stocks See Volatility Amid Global Trade Tensions

Virtually all of the top cryptocurrencies are today seeing deep red in a market-wide correction.

Tuesday, June 4 —  virtually all of the top cryptocurrencies are today seeing deep red in a market-wide correction, with bitcoin (BTC) dropping back below the $8,000 price point, as Coin360 data shows.

Market visualization

Market visualization courtesy of Coin360

Having bullishly broken through the psychological price point of $9,000 at the end of May, bitcoin has gradually corrected downwards in subsequent days. To press time, the top coin is trading at $7,950 — roughly 6.7% down on the day and losing its hold on the $8,000 mark, according to CoinMarketCap data.

Bitcoin’s sharp tumble started very early trading hours, with the coin swiftly dropping from roughly $8,500 at midnight to around $8,000 by 1:00AM (UTC+1). Since then, the cryptocurrency has brushed an intraday low of roughly $7,865 before slightly regaining ground before press time.  

On the week, the cryptocurrency’s losses have reached 8.78%.

Bitcoin 24-hour price chart

Bitcoin 24-hour price chart. Source: CoinMarketCap

Largest altcoin by market cap ether (ETH) has seen a loss of 6.36% on the day to press time to trade around $247. Ether has today correlated with bitcoin’s price tumble, losing value during very early trading hours. On its 7-day chart, the alt has seen jagged volatility, breaking above $285 on May 30, then seeing seeing a sharp correction back to $250,before reclaiming the $260-70 range.

Ether is reporting an 8.7% loss on the week.

Ether 7-day price chart

Ether 7-day price chart. Source: CoinMarketCap

XRP has reported a 7% loss on the day to trade at $0.41 by press time. While holding its ground on the XRP-BTC chart, XRP has lost sharply against the U.S. dollar over the past 24 hours. On the week, XRP’s losses stand at a milder 3.53%.

XRP 7-day price chart

XRP 7-day price chart. Source: CoinMarketCap

Among the top ten cryptocurrencies at press time, all are in the red except for eighth-largest coin bitcoin sv (BSV), which has reported a 3% gain on the day to trade around $221.

The highest 24-hour loss has been reported by 6th largest crypto eos (EOS), which is down 9.36% to trade at $6.70 by press time. Bitcoin cash (BCH), litecoin (LTC) and stellar (XLM) are all down between 7-8% on the day.

Widening out to the top twenty, all further coins are red. 18th largest coin tezos (XTZ) has seen the highest loss, down 10.25% to trade at $1.31 by press time. Tron (TRX), iota (MIOTA), neo (NEO) and nem (XEM) are all reporting losses of between 8 and 10% on the day.

Ethereum classic (ETC) and dash (DASH) are meanwhile seeing milder losses of 4.2 and 5.5% respectively.

To press time, the total market capitalization of all cryptocurrencies is at around $254.29 billion — as compared with an intraweek high of $286.55 billion on May 30. Bitcoin dominance is at 55.8%.

Total market capitalization of all cryptocurrencies

Total market capitalization of all cryptocurrencies. Source: CoinMarketCap

According to data released by the United States Commodity Futures Trading Commission yesterday, the number of open contracts for the Chicago Mercantile Exchange’s (CME) bitcoin (BTC) futures ostensibly hit at an all-time high for the week from May 27 to June 3.

Analytics firm Delphi Digital has meanwhile argued that bitcoin has been outperforming weaker traditional risk assets, with the latter seeing selling pressure amid waning sentiment for economic growth in 2019 and United States-China trade tensions.

In traditional markets, U.S. stock index futures opened slightly higher this morning, with Dow futures rising 9 points — indicating a positive open of more than 52 points — as of 01.45 a.m. ET, CNBC reported. Futures on the S&P and Nasdaq reported similarly slight gains.

Yesterday, St. Louis Federal Reserve president James Bullard revealed that a U.S. interest rate cut “may be warranted soon” in light of the risks to economic growth presented by international trade feuds as well as weak domestic inflation.