Huobi Research Weekly (Vol.101) 2020.2.10–2020.2.16)

Abstract

This week, the overall market capitalization for the top 100 cryptocurrencies decreased of 0.67%, with 43 projects decreased in value to varying degrees. According to coinmarketcap, as of February 16th, 2020, the total market cap of cryptocurrencies was 288.0 billion U.S. dollars, decreased by 0.67%, and the total market cap of the top 100 cryptocurrencies was 285.2 billion U.S. dollars,decreased by 0.28% from last week. 7 cryptocurrency projects entered the top 100 this week, namely HBAR、CENNZ、FXC、LUNA、KNC、WAXP and GAP. As of February 16th, 2020, Bitcoin was traded at 9934.43USD, 1.74% lower than its price last week. Ethereum was traded at 259.89USD, 13.80% higher than its price last week.

The hashrate of Bitcoin decreased but Ethereum increased by this week. This week, the difficulty of mining Bitcoin increased and the difficulty of mining Ethereum increased. The average number of transactions per block increased and the average block size of Bitcoin increased. The average number of transactions per block increased and the average block size of Ethereum increased this week.The average transaction fees of Bitcoin and Ethereum both increased.LINK was the most active project on GitHub this week.

The average bitcoin Hashrate for the entire network reached 107.9EH/s, decreased by 2.44% from the previous week.Average Hashrate for the entire Ethereum network was 171.45TH/s this week, increased by 3.15%. Average difficulty for mining Bitcoin this week was 15.50T, increased by 0.26% from last week. The average difficulty of mining Ethereum this week was 2164.50TH, increased by 3.03% from that of previous week.

In network activity, the average size of each block was 1.14MB, increased 1.79% form last week; there were on average 2362 transactions recorded in each block, increased by 5.40% from the previous week. The average number of transactions per block in Ethereum this week was 110.7, increased by 20.72%. The average size of each block was 23868.71 bytes, increased by 19.14% compared to last week. As of February 16th, 2020, average transaction fees of Bitcoin this week was $0.898, increased by 36.27% from last week. Average transaction fees of Ethereum this week was $0.198, incresead by 47.76%. The total number of Bitcoin addresses was 45928651 increased by 295056 (0.65%). LINK was the most active project on GitHub this week, with 96 commits submitted in the past week.

In terms of community activity, Tron, Bitcoin and Ethereum are the most popular communities on Facebook. On Twitter, the most popular communities are Bitcoin, Ripple and Tron.

2 investments activities took place in the blockchain industry this week, Jubi got bought by Uniweb, Summa got seed round investment from Nervos.

1. Weekly Market Review

1.1 Market overview

This week, the overall market capitalization for the top 100 cryptocurrencies decreased of 0.67%, with 43 projects decreased in value to varying degrees. According to coinmarketcap, as of February 16th, 2020, the total market cap of cryptocurrencies was 288.0 billion U.S. dollars, decreased by 0.67%, and the total market cap of the top 100 cryptocurrencies was 285.2 billion U.S. dollars,decreased by 0.28% from last week, among which, FLG had the largest increased of 299.12%, bringing its market cap ranking from №45 to №23, MOF had the largest decreased of -26.49%, bringing its market cap ranking from №65 to №85. In addition, there were 7 projects that entered TOP100, namely, GAP (GAPS, increased 9.13%, Now №100), LUNA (Terra, increased 12.81%, Now №96), KNC (Kyber Network, increased 17.76%, Now №97), FXC (Flexacoin, increased 20.60%, Now №93), CENNZ (Centrality, increased 38.47%, Now №92), WAXP (WAX, increased 130.95%, Now №98), HBAR (Hedera Hashgraph, increased 150.84%, Now №53). As of February 16th, 2020, Bitcoin was traded at 9934.43USD, 1.74% lower than its price last week. Ethereum was traded at 259.89USD, 13.80% higher than its price last week.

The overall 24h trading volume increased this week. Overall, the 24h trading volume increased by 32.62% compared with the same period of last week. In this week,71 of the top 100 projects increased in 24h trading volume, led by WAXP with a weekly increase of 2752.58%; there were 29 projects decreased in their 24h trading volume, there were 12 projects that saw over 20% decrease in their 24h trading volume, while 6 projects fell by more than 50%, led by FLG, with a decreased of 78.20%.

The top 10 cryptocurrencies’ market value decreased, the market share distribution remained stable. On February 16th, 2020, the overall market cap of the top 10 cryptocurrencies was 254.8 billion USD, decreased by 0.54% from last week, accounting for 88.47% of the total market capitalization of cryptocurrencies, increased by 0.12% from last week. The market value proportion of TOP10 project basically stable. BTC’s dominance was 62.85%, decreased by 0.68% from last week.

1.2 Segment Analysis

Among TOP 100 cryptocurrency project segments, the total market cap of Platform projects got the largest increase. The average market cap of Application projects got the largest increase. As of February 16th, 2020, the total market cap of coin projects reached 210.8 billion USD, decreased by 2.05%. The average market cap of coin projects reached 6.02 billion USD, decreased by 4.85%. The total market cap of platform projects reached 42.6 billion USD, increased by 6.69%. The average market cap of platform projects reached 1.25 billion USD, increased by 6.69%. The total market cap of application class projects reached 27.0 billion USD, increased by 3.60%. The average market cap of application class projects reached 0.93 billion USD, increased by 7.18%. The total market cap of asset-backed token projects reached 4.78 billion USD, decreased by 0.15%. The average market cap of asset-backed token projects reached 2.39 billion USD, decreased by 0.15%.

The market segment distribution of the top 100 cryptocurrencies remained stable. As of February 16th, 2020, among the top 100 projects, the number of coin class projects increased 1, application class projects decreased 1, platform class projects remain the same and asset-backed token class remain the same. The largest overall market cap by segment was still coin projects, accounting for 73.90% of the total market cap of top 100 projects.

Note: According to the different attributes of cryptocurrencies, Huobi Academy of Blockchain Application will divide them into four categories: Coin, Application Class, Platform Class and Asset-backed Token.

Coin Project: Refers to a type of asset developed based on blockchain technology that does not correspond to a specific use scenario and whose main function is only the transaction target. Its asset value is mainly reflected by liquidity.

Platform Class Project: A type of asset that is associated with the development of the underlying technology of the blockchain and is supported by the right to use or participate in the platform.

Application Class Project: Refers to a type of asset that is associated with a specific application scenario and is supported by a certain right of use, participation, or dividend.

Asset-backed Project: Refers to a class of assets that is linked to actual assets such as gold and US dollars and supported by the value of physical assets.

2. Technical Statistics

2.1 Cryptocurrency Mining Statistics

The hashrate of Bitcoin decreased but Ethereum increased by this week. From February 10th, 2020 — February 16, 2020, the average bitcoin Hashrate for the entire network reached 107.9EH/s, decreased by 2.44% from the previous week.

Average Hashrate for the entire Ethereum network was 171.45TH/s this week, increased by 3.15%.

This week, the difficulty of mining Bitcoin increased and Ethereum increased. As of February 16th, 2020, average difficulty for mining Bitcoin this week was 15.50T, increased by 0.26% from last week. The average difficulty of mining Ethereum this week was 2164.50TH, increased by 3.03% from that of previous week.

The number of blocks in Bitcoin decreased by 0.60%. Top 5 rankings remain the same. The overall distribution of the Ethereum mining pools rankings remain the same, the number of blocks decreased 1.76%. In the past week, Bitcoin mined 986 blocks, decreased 0.60% from the previous week. Among the top five pools were F2Pool、 Poolin、BTC.com、AntPool、OKExPool, these 5 pools mined 192、158、106、101 and 71 blocks respectively, accounting for 19.47% 、16.02%、10.75%、10.24% and 7.20% of all Bitcoins mined this week. The Hashrate was 21.19 EH/s、17.43EH/s、11.70EH/s、11.14EH/s and 7.83EH/s, respectively.

In the past week, Ethereu’s entire network mined 47046 blocks, decreased 1.76% from the previous week. The top five pools were SparkPool, Ethermine, F2pool, Nanopool and Zhizhu.top, each mined 15261、10145、5050、3839 and 1866 blocks respectively, accounting for 32.4385%、21.5640%、10.7342%、8.1601% and 3.9663% of all Ethereum mined this week, respectively.

2.2 Activity Statistics

The average number of transactions per block increased and the average block size of Bitcoin increased. The average number of transactions per block increased and the average block size of Ethereum increased this week. According to blockchain.info, from February 10th,2020-February 16th,2020, the average size of each block was 1.14MB, increased 1.79% form last week; there were on average 2362 transactions recorded in each block, increased by 5.40% from the previous week.

According to etherscan, the average number of transactions per block in Ethereum this week was 110.7, increased by 20.72%. The average size of each block was 23868.71 bytes, increased by 19.14% compared to last week.

Number of unconfirmed transactions in Bitcoin increased by 50.06%. Number of unconfirmed transactions in Ethereum decreased by 2.22% from the previous week. As of February 16th, 2020, the number of 7-day average unconfirmed transactions in Bitcoin network was 10581, increased by 50.06% from last week. There were 66510.84 unconfirmed transactions in the Ethereum network, decreased by 2.22% from last week, with the lowest amount of unconfirmed transactions in the week being 5062 and the highest amount being 74476.

Total transaction fees of Bitcoin and Ethereum both increased. As of February 16th, 2020, average transaction fees of Bitcoin this week was $0.898, increased by 36.27% from last week. Average transaction fees of Ethereum this week was $0.198, incresead by 47.76%.

The average number of distinct miners per day in Ethereum increased by 13.19% from last week. From February 10th, 2020-February 16th, 2020,the average number of distinct miners per day in Ethereum this week was 51.5, increased by 13.19% from last week.

The number of nodes in Bitcoin decreased ,The number of nodes in Ethereum decreased this week. As of February 16th, 2020, there were 10484 Bitcoin nodes, decreased by 3.04% compared to last week, of which 2230 nodes were in the U.S, 1792 nodes were Germany, and 253 nodes were in China(№9), each accounting for 21.27%, 17.09% and 2.41% of the total number of Bitcoin nodes, respectively.

As of February 16th, 2020, there were 8134 Ethereum nodes, increased by 5.24% from the previous week. Specifically, there were 2179 nodes in the U.S, 1105 nodes in China, and 812 nodes in Germany, each accounting for 26.79%, 13.58%,9.98% of total number of nodes, respectively.

This week, the growth rate for new addresses of Bitcoin increased. According to the data on blockchain, as of February 16th, 2020, the total number of Bitcoin addresses was 45928651 increased by 295056 (0.65%).

LINK was the most active project on GitHub this week. From February 10th, 2020 -February 16th, 2020, Link was the active project repository on GitHub with a total of 96 commits.

2.3 Community Activity Statistics

The top three most popular cryptocurrencies on Facebook were Tron, Bitcoin and Ethereum in descending order, with 965k, 527k and 158k fans respectively. The top three most popular cryptocurrencies on Twitter were Bitcoin, Ripple(XRP) and TRON, with 1million , 945k, and 498k followers, respectively.

3. Weekly Blockchain News Review

3.1 Industrial Application

1. Danone infant milk powder introduced double code tracing and applied blockchain and other technologies

On February 13, Danone announced the launch of “two code traceability” service for infant formula milk powder, aiming to improve the information transparency of milk powder, help consumers and retailers understand the whole process of products from ranch to customers, and obtain personalized after-sales support and services. Danone milk powder “double code tracing” technology consists of two laser printed two-dimensional codes, which are respectively located on the outer packaging of the product and the aluminum film inside the can. Consumers can scan the external QR code on the package to visit the brand page to understand the product production location, date, supply chain process and other verification information; after purchasing and unpacking, they can scan the internal QR code to verify the authenticity of the product. Once the internal code has been scanned, it will display “can opened” when scanning again. In addition, this traceability service uses blockchain, serialization and aggregation technologies, and secure storage means can ensure the safety of product supply chain data and information.

2. Financial one account uses blockchain and other technologies to build an intelligent financial supermarket to provide loan support for small and micro businesses during the epidemic

According to the economic daily, the epidemic has hit the offline retail and catering industry hard. In view of the financing difficulties of small and micro businesses in the people’s livelihood industries such as e-commerce and takeout, one account finance has invested technical force to build an intelligent financial supermarket and connect a wide range of small and micro businesses and financial institutions. According to the integration of rich enterprise operation data and artificial intelligence, blockchain, big data and other technologies, financeoneaccount has formed a portrait system for enterprises. After enterprises enter the supermarket, they can see the loan products that match their best, which greatly saves their choice cost and wins them precious anti epidemic time.

3. One hundred national associations jointly launched the “blockchain + charity” project

In response to the call of the central government on accelerating the development of blockchain technology and industrial innovation, the blockchain branch of China Software Industry Association, together with the Organizing Committee of 2020 blockchain conference, recently jointly launched the “blockchain + charity” project to provide blockchain technology solutions for the charity industry: transparent and supervised operation, traceable material status and whereabouts, and checkable payment details To see and raise funds transparently. It is reported that the unique transparent traceability, non tampering and distributed storage features of blockchain technology just provide technical support for the above scheme. Up to now, there have been 109 associations, foundations, etc. in response nationwide, participating in joint launching.

3.2 International Policies

1. Report: Middle East and Africa’s Blockchain Spending to Surge 400% by 2023

As global blockchain adoption is accelerating, countries in the Middle East and Africa (MEA) are forecasted to massively increase their spending on the tech in the next few years.According to a new report by United States-based market research firm International Data Corporation (IDC), governments across MEA will see a 400% surge in their investment to blockchain-based solutions in four years. According to the report, the authorities in the MEA region are actively developing blockchain-enabled solutions to reduce fraud, increase security and improve public administration.Jyoti Lalchandani, vice president and regional managing director at the IDC’s division for the Middle East, Turkey, and Africa, emphasized that governments in the MEA region are facing a challenge to learn a whole new set of technologies like blockchain.

2. Crypto Mining Does Not Require Governmental Oversight, Ukrainian Regulator Says

Ukrainian authorities said that crypto mining does not require regulatory activity from governmental oversight bodies or other third-party regulations.

In its manifest on virtual assets published on Feb. 7, the Ministry of Digital Transformation of Ukraine stated that mining does not require regulation by state authorities as this activity is regulated by the protocol itself and network members. The agency further outlined that it will contribute to the development and implementation of decentralized technologies, as well as establish sandboxes for their evaluation and verification, and assessment of potential risks to the market.The agency pledged to promote interaction between the financial market and virtual assets and their effective development, international best practices on taxation of virtual assets, as well as establish effective mechanisms to prevent abuse and offense from business and law enforcement.

3. FinCEN: Social Media Crypto Projects Can’t Ignore Money Laundering Risk

The deputy director of the United States Financial Crimes Enforcement Network (FinCEN) says the cryptocurrency sector must not abet a “slide backward” in money laundering prevention.FinCEN deputy director Jamal El-Hindi made his remarks during a speech at the Securities Industry and Financial Markets Association 20th Anti-Money Laundering (AML) and Financial Crimes Conference in New York City on Feb. 6. El-Hindi opened his speech noting the particular complexity of the securities and futures industry, which comprises a dense web of transactions and interactions between inter-related parties. This “amazingly complex” landscape includes but is not limited to primary brokerages, futures commission merchants, executing dealers, transfer agents, clearing firms and mutual funds, he observed.This complexity, he suggested, presents a challenge to the transparency — the information collection and due diligence processes — needed to tackle money laundering and prevent financial crimes.

3.3 Technological Breakthrough

1. Five trends of blockchain and distributed ledger technology in 2020

The development of blockchain is still in its infancy. Only a few enterprises have successfully utilized it and achieved mature operation. In the future, blockchain technology will be closely connected with artificial intelligence, Internet of things and other emerging technologies. The following is the technical development trend predicted by the researchers in 2020.

1、 Financial services are still in the early stage of application. Blockchain technology first appeared in the form of digital cryptocurrency (bitcoin), so the financial industry is also the first industry interested in blockchain technology. Subsequently, the financial industry began to make innovation and breakthrough in blockchain technology and application. Related activities are not limited to the concept of virtual currency. Blockchain has been applied to the construction of anti fraud clearing and settlement systems, smart contracts, etc., greatly accelerating the speed of digital transactions.

2、 Libra is still in the process. Facebook plans to release its own cryptocurrency, Libra, in early 2020, although most details have not yet been released, but some concerns and concerns have been raised. So far, there have been many cryptocurrency projects. Since the advent of bitcoin in 2009, more than 1000 cryptocurrency projects have been launched, but most of them have failed quickly. There has never been a company with the same background and size as Facebook to launch a digital currency project — a factor that means the cryptocurrency project may be far more meaningful than all previous cryptocurrency projects.

3、 The integration and development of blockchain and artificial intelligence. Blockchain technology can increase the use of artificial intelligence, which can make blockchain more secure, and at the same time, tools based on blockchain are easier to operate.

4、 Blockchain ensures the security of the Internet of things. With the digital transformation of industry, more and more work involves the communication between machines, so it becomes more and more important to store and record information in a reliable and tamper proof way.

5、 Blockchain legislation. Since the emergence of the first cryptocurrency, anonymity and digital transfer of value between people have been realized, and regulators and the central bank soon realized the potential of related technologies in money laundering and other malicious financial activities. Regulation should be a promoter of technological innovation rather than a hindrance.

4.Weekly Investment Activities

2 investments activities took place in the blockchain industry this week, Jubi got bought by Uniweb, Summa got seed round investment from Nervos.

Huobi Research

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