Huobi Research Weekly (Vol.116) 2020.5.25–2020.5.31)

Abstract

This week, the overall market capitalization for the top 100 cryptocurrencies increased of 8.39%, with 77 projects increased in value to varying degrees. According to coinmarketcap, as of May 31, 2020, the total market cap of cryptocurrencies was 265.8 billion U.S. dollars, increased by 8.39%, and the total market cap of the top 100 cryptocurrencies was 264.1 billion U.S. dollars, increased by 7.90% from last week. 5 cryptocurrency projects entered the top 100 this week, namely QNT、NEXO、XVG、ERC20、and BTM. As of May 31, 2020, Bitcoin was traded at 9461.06USD, 7.66% higher than its price last week. Ethereum was traded at 230.98USD, 14.23% higher than its price last week.

The hashrate of Bitcoin increased and Ethereum decreased by this week. This week, the difficulty of mining Bitcoin not changed and the difficulty of mining Ethereum increased. The average number of transactions per block decreased and the average block size of Bitcoin decreased. The average number of transactions per block increased and the average block size of Ethereum increased this week.The average transaction fees of Bitcoin decreased but Ethereum increased. ZSC was the most active project on GitHub this week.

The average bitcoin Hashrate for the entire network reached 94.60 EH/s, increased by 5.64% from the previous week.Average Hashrate for the entire Ethereum network was 180.91TH/s this week, decreased by 0.06%. Average difficulty for mining Bitcoin this week was 15.13T, as same as last week. The average difficulty of mining Ethereum this week was 2276.83TH, increased by 0.18% from that of previous week.

In network activity, the average size of each block was 1.25MB, decreased 2.34% form last week; there were on average 1834 transactions recorded in each block, decreased by 18.92% from the previous week. The average number of transactions per block in Ethereum this week was 139.0, increased by 3.96%. The average size of each block was 27752.71 bytes, increased by 2.01% compared to last week. As of May 31, 2020, average transaction fees of Bitcoin this week was $ 2.276, decreased by 38.49% from last week. Average transaction fees of Ethereum this week was $0. 5, incresead by 69.49%. The total number of Bitcoin addresses was 49584938 increased by 246057 (0.50%). ZSC was the most active project on GitHub this week, with 84 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.

3 investments activities took place in the blockchain industry this week, Airfox got bought by Via Varejo, SatoshiPay got 0.5 million dollars in strategic investment from SDF, CasperLabs got strategic investment from Nova club.

1. Weekly Market Review

1.1 Market overview

This week, the overall market capitalization for the top 100 cryptocurrencies increased of 8.39%, with 77 projects increased in value to varying degrees. According to coinmarketcap, as of May 31, 2020, the total market cap of cryptocurrencies was 265.8 billion U.S. dollars, increased by 8.39%, and the total market cap of the top 100 cryptocurrencies was 264.1 billion U.S. dollars, increased by 7.90% from last week, among which, HEX had the largest increased of 49.27%, bringing its market cap ranking from №73 to №55, THETA had the largest decreased of -29.05%, bringing its market cap ranking from №36 to №42. In addition, there were 5 projects that entered TOP100, namely, XVG (Verge, increased 10.76%, Now №99), NEXO (Nexo, increased 14.14%, Now №95), BTM (Bytom, increased 25.42%, Now №88), QNT (Quant, increased 31.80%, Now №85), ERC20 (ERC20, increased 32.37%, Now №100). As of May 31, 2020, Bitcoin was traded at 9461.06USD, 7.66% higher than its price last week. Ethereum was traded at 230.98USD, 14.23% higher than its price last week.

The overall 24h trading volume decreased this week. Overall, the 24h trading volume decreased by 4.89% compared with the same period of last week. In this week, 62 of the top 100 projects increased in 24h trading volume, led by ADA with a weekly increase of 681.97%; there were 37 projects decreased in their 24h trading volume, there were 20 projects that saw over 20% decrease in their 24h trading volume, while 6 projects fell by more than 50%, led by NEXO, with a decreased of 88.82%.

The top 10 cryptocurrencies’ market value increased, the market share distribution remained stable. On May 31,2020, the overall market cap of the top 10 cryptocurrencies was 235.4 billion USD, increased by 7.74% from last week, accounting for 88.56% of the total market capitalization of cryptocurrencies, decreased by 0.53% from last week. The market value proportion of TOP10 project basically stable. BTC’s dominance was 65.44%, decreased by 0.44% from last week.

1.2 Segment Analysis

Among TOP 100 cryptocurrency project segments, the total market cap of Platform Project got the largest increase. The average market cap of Platform Project got the largest increase. As of May 31, 2020, the total market cap of coin projects reached 194.8 billion USD, increased by 7.48%. The average market cap of coin projects reached 5.26 billion USD, increased by 1.67%. The total market cap of platform projects reached 36.0 billion USD, increased by 13.68%. The average market cap of platform projects reached 1.38 billion USD, increased by 22.43%. The total market cap of application class projects reached 24.2 billion USD, increased by 6.54%. The average market cap of application class projects reached 0.71 billion USD, increased by 6.54%. The total market cap of asset-backed token projects reached 9.03 billion USD, decreased by 0.43%. The average market cap of asset-backed token projects reached 3.01 billion USD, decreased by 0.43%.

The market segment distribution of the top 100 cryptocurrencies remained stable. As of May 31, 2020, among the top 100 projects, the number of coin class projects increased 2, application class projects remain the same, platform class projects decreased 2 and asset-backed token class remain the same. The largest overall market cap by segment was still coin projects, accounting for 73.77% 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 increased but Ethereum decreased by this week. From May 25, 2020 — May 31, 2020 ,the average bitcoin Hashrate for the entire network reached 94.60 EH/s, increased by 5.64% from the previous week.

Average Hashrate for the entire Ethereum network was 180.91TH/s this week, decreased by 0.06%.

This week, the difficulty of mining Bitcoin had not changed and Ethereum increased. As of May 31, 2020, average difficulty for mining Bitcoin this week was 15.13T, as same as last week. The average difficulty of mining Ethereum this week was 2276.83TH, increased by 0.18% from that of previous week.

The number of blocks in Bitcoin increased by 11.84%. Top 5 rankings had changed. The overall distribution of the Ethereum mining pools rankings remain the same, the number of blocks increased 0.54%. In the past week, Bitcoin mined 935 blocks, increased 11.84% from the previous week. Among the top five pools were F2Pool、Poolin、AntPool、BTC.com、58COIN&1THash, these 5 pools mined 177、149、123、119 and 69 blocks respectively, accounting for 18.93%、15.94%、13.16%、12.73% and 7.38% of all Bitcoins mined this week. The Hashrate was 19.02 EH/s、16.01EH/s、13.22EH/s、12.79EH/s and 7.41EH/s, respectively.

In the past week, Ethereu’s entire network mined 47899 blocks, increased 0.54% from the previous week. The top five pools were SparkPool, Ethermine, F2pool, Nanopool and Zhizhu.top, each mined 15073、10365、4597、3114 and 2940 blocks respectively, accounting for 31.4683%、21.6393%、9.5973%、6.5012% and 6.1379% of all Ethereum mined this week, respectively.

2.2 Activity Statistics

The average number of transactions per block decreased and the average block size of Bitcoin decreased. The average number of transactions per block increased and the average block size of Ethereum increased this week. According to blockchain.info, from May 25, 2020-May 31, 2020, the average size of each block was 1.25MB, decreased 2.34% form last week; there were on average 1834 transactions recorded in each block, decreased by 18.92% from the previous week.

According to etherscan, the average number of transactions per block in Ethereum this week was 139.0, increased by 3.96%. The average size of each block was 27752.71 bytes, increased by 2.01% compared to last week.

Number of unconfirmed transactions in Bitcoin decreased by 90.17%. Number of unconfirmed transactions in Ethereum increased by 0.89% from the previous week. As of May 31, 2020, the number of 7-day average unconfirmed transactions in Bitcoin network was 1440, decreased by 90.17% from last week. There were 88389.46 unconfirmed transactions in the Ethereum network, increased by 0.89% from last week, with the lowest amount of unconfirmed transactions in the week being 73729 and the highest amount being 98085.

Total transaction fees of Bitcoin decreased but Ethereum increased. As of May 31, 2020, average transaction fees of Bitcoin this week was $ 2.276, decreased by 38.49% from last week. Average transaction fees of Ethereum this week was $0. 5, incresead by 69.49%.

The average number of distinct miners per day in Ethereum decreased by 1.37% from last week. From May 25, 2020- May 31, 2020, the average number of distinct miners per day in Ethereum this week was 50.4, decreased by 1.37% from last week.

The number of nodes in Bitcoin increased ,The number of nodes in Ethereum increased this week. As of May 31, 2020, there were 10534 Bitcoin nodes, increased by 1.48% compared to last week, of which 1981 nodes were in the U.S, 1808 nodes were Germany, and 201 nodes were in China(№10), each accounting for 18.81%, 17.16% and 1.91% of the total number of Bitcoin nodes, respectively.

As of May 31, 2020, there were 7437 Ethereum nodes, increased by 3.55% from the previous week. Specifically, there were 2277 nodes in the U.S, 473 nodes in China, and 799 nodes in Germany, each accounting for 30.62%, 6.36%, 10.74% 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 May 31, 2020, the total number of Bitcoin addresses was 49584938 increased by 246057 (0.50%).

ZSC was the most active project on GitHub this week. From May 25, 2020 — May 31, 2020, zeus-shield was the active project repository on GitHub with a total of 84 commits.

2.3 Community Activity Statistics

The top three most popular cryptocurrencies on Facebook were Tron, Bitcoin and Ethereum in descending order, with 964k, 584k and 166k fans respectively. The top three most popular cryptocurrencies on Twitter were Bitcoin, Ripple(XRP) and TRON, with 1 million , 952k, and 508k followers, respectively.

3. Weekly Blockchain News Review

3.1 Industrial Application

1. Pandemic Spurs Top Port Operator to Join Blockchain Shipping Platform

The COVID-19 pandemic is prompting supply chain actors worldwide to focus their energies on becoming more resilient through better digitization — and in particular through blockchain technology.One of the world’s leading ports operators, DP World, announced on May 28 that it would be joining TradeLens, the blockchain shipping platform created by IBM and Danish logistics giant Maersk.TradeLens is a global supply chain solution with a focus on containerized freight and logistics, which was first launched by IBM and Maersk back in April 2018. The platform’s broadening geographic scope and support for efficient, blockchain-based digital documentation flows appears to be coming into its own during the pandemic. Global value chains — many of which still rely in part on paper-based processes — have come under increasing strain due to unstable supply and demand, transport frictions and labor shortages. TradeLens works by providing standards-based open APIs that enable supply chain data to be securely and transparently tracked and shared using a permissioned blockchain.By integrating with TradeLens, DP World will, according to Maersk, be able to improve the efficiency of its operations by being able to track container flows across multiple carriers earlier on in the supply chain cycle.

2. Vodafone to Connect ‘Billions’ of Energy Producing Devices Using Blockchain

Global telecommunications giant Vodafone has partnered with blockchain startup Energy Web (EWT) to connect “billions’’ of distributed energy generating assets via internet-of-things (IoT) and distributed ledger technology (DLT).Energy Web announced the partnership on May 26, revealing that the project will combine SIM-centric DLT with IoT connectivity provided by Vodafone Business to “create secure IDs for energy assets.”“This means that renewable and distributed assets like wind turbines, batteries, heat pumps, and solar panels can be integrated with energy grids safely and efficiently,” said Energy Web. The firms will develop a system inspired by the way that telecom operators securely identify mobile phones using SIM cards for grids to identify and track distributed energy sources.The smart grid system will be underpinned by Vodafone’s IoT technology and the Energy Web Decentralized Operating System.

3. Korean Tech Giant LG Is Developing a Blockchain Identity System With a US Firm

LG has partnered with United States-based company Evernym to develop blockchain ID technology.Asian financial news outlet Aju Business Daily reported on May 26 that LG CNS — LG’s IT services subsidiary — signed a memorandum of understanding with Evernym. The collaboration between the two firms aims to develop international digital identity standards at the World Wide Web Consortium. To establish the new standard, the two firms decided to jointly develop a blockchain-based decentralized authentication system to replace international driver’s licenses and passports. Evernym already launched Sovrin, a platform aiming to enable organizations and governments to issue, verify and manage digital credentials such as digital passports. Blockchain’s censorship-resistance and resilient infrastructure make it a great fit as a foundation for digital identity solutions that need to be secure and always accessible. Decentralized digital identity solutions are one of the most active areas of development of blockchain technology.

3.2 International Policies

1. Russia’s Central Bank to Launch Blockchain-Powered Digital Mortgage Platform

The Central Bank of Russia is reportedly developing a digital mortgage platform powered by a domestically developed blockchain called Masterchain, local state-owned news agency Ria reported on May 28.According to Olga Skorobogatova, first deputy governor at the central bank, Masterchain has recently started to support digital mortgages, which forms a foundation for the upcoming platform. The financial institution has already submitted the proposal for its digital mortgage project to the government and the Federal Service for State Registration, Cadastre and Cartography (Rosreestr).Masterchain is reportedly the first blockchain platform in Russia to be certified by the Federal Security Service, or FSB. According to previous reports, it is a permissioned, Ethereum-based blockchain that was launched in 2017 by the FinTech Association, an entity affiliated with the Bank of Russia.Notably, it wouldn’t be the first time Masterchain is used for e-mortgages. In September 2018, a Russian subsidiary of Raiffeisen Bank International reportedly published mortgage documents containing data on the parties in the transaction, the credit loan and its duration, and the property purchased in Masterchain’s decentralized depositary system (DDS).

2. Lithuania’s Central Bank Completes Blockchain Regulatory Research

As of May 27, the Bank of Lithuania, or BoL, has finished the research phase of its blockchain-related project, LBChain. In the next phase, the institution will create a sandbox that mixes technological and regulatory infrastructure for the technology.The platforms used for the research phase include Hyperledger Fabric and Corda, which were developed by IBM Polska SP. Z.o.o and TietoEVRY. LBChain allowed market participants to test their business solutions in a controlled environment by assessing the critical needs of fintech and startups. They then provided them with the ability to carry out blockchain-oriented research and adapt blockchain-based services into their businesses. Among the projects mentioned, LBChain included a solution for blockchain-based regulatory reporting, a blockchain platform for green bond issuance, and a blockchain-based digital bank.

3. South Korea Is Exploring New Crypto Tax Laws

South Korea’s Ministry of Economy and Finance is preparing an amendment to apply to the nation’s Income Tax Law. This could include rules for profitable sales of cryptocurrencies as well as profits from national crypto mining projects.According to local newspaper E Daily on May 27, the ministry also mentioned including the profits generated by initial coin offerings, or ICOs. This is tantamount to a change in the country’s rhetoric towards ICOs, which are still banned across the country.The report specifies that crypto-to-crypto transactions, such as Bitcoin (BTC), will be “likely” exempt from the proposed amendment and only seeks to tax-for-profit transactions and not loss-making ones. The ministry issued the following statements on the proposal:“We are considering capital gains tax or other income tax on profits made by domestic and foreign investors in the transfer of virtual assets.” It is still unclear if the gains in cryptocurrency transactions are similar to profits in other assets like stocks and real estate in the eyes of the government.

4.Weekly Investment Activities

3 investments activities took place in the blockchain industry this week, Airfox got bought by Via Varejo, SatoshiPay got 0.5 million dollars in strategic investment from SDF, CasperLabs got strategic investment from Nova club.

Huobi Research

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