[ad_1]
Just a couple of weeks before the end of the year, it is probably safe to say that 2018 was not a good year for the cryptocurrency market.
The total market valuation, which peaked at over $ 800 billion in January this year, fell to just over one hundred billion dollars after a series of recent slides.
Market price or cryptocurrency It is not a good predictor of the future of industry
Naturally, the depressed prices of digital currencies had some investors worried about the future of the nascent industry.
However, a Weiss Cryptocurrency Ratings analyst states that market capitalization is not a good way to measure if crypto-space grows or shrinks.
The crypt analyst Juan M. Villaverde wrote:
"The reality: market capitalization is almost entirely a reflection of the market price, and the price, in turn, is subject to the vagaries of market cycles and investor psychology".
A better way to measure industry progress
According to Villaverde, the prices of encryption or market capitalization are influenced by investor sentiment and may not necessarily reflect recent progress in the sector.
A better indicator of the future of the sector is the adoption of the measurement of digital currencies through actual transactions.
Villaverde wrote:
"A much more reliable way to track the progress of the industry is with real-world transactions … which, by the way, are growing by leaps and bounds."
The analyst explained that there are actually two types of cryptocurrency transactions.
The first type takes place in exchanges and is started by speculators, investors and traders.
This type of transaction is cyclical and the volume is largely determined by the decreases and increases in the market.
The second type of cryptocurrency transaction is called chain transactions that occur on the register itself.
These are also called real transactions as they are payments using digital currency: the actual use of the crypt itself.
According to Villaverde:
"The transactions of the second type have grown by leaps and bounds throughout the year!"
People definitely use Cryptos these days
Take the for example EOS cryptocurrency.
At the start of the year, digital money averaged only 10,000 transactions on a daily basis.
These days, however, there are about 6.7 million on-chain currency transactions, which is an astonishing 67,000% increase in just under a year.
The increase in the use of cryptography is not limited to EOS alone.
Also TRON recorded a dramatic increase of 60,000% in its chain transaction this year.
At the beginning of 2018, the volume of chain transactions was less than 1,000, but then rose to around 600,000 a day.
For investors who still feel depressed about how the encryption prices turned out in 2018, Villaverde offers some words of encouragement.
The analyst believes that cryptos & # 39; "use of the real world that will eventually increase the price of the most widespread cryptocurrencies".
RELATED ARTICLES
MORE FROM OUR PARTNERS
Advertisement
[ad_2]Source link
