Huobi Research Weekly (Vol.182) (2021.9.6–2021.9.12)

Abstract

This week, the overall market capitalization for the top 100 cryptocurrencies decreased of 11.22%, with 70 projects decreased in value to varying degrees. According to coinmarketcap, as of September 12, 2021, the total market cap of cryptocurrencies was 2075.7 billion U.S.dollars, decreased of 11.22%, and the total market cap of the top 100 cryptocurrencies was 2060.6 billion U.S. dollars, decreased by 9.56% from last week. 5 cryptocurrency projects entered the top 100 this week, namely CRV, IOST, XEC, MINA and RAY. As of September 12, 2021, Bitcoin was traded at 46063.27USD, 10.96% lower than its price last week. Ethereum was traded at 3410.13USD, 13.64% lower than its price last week.

The hashrate of Bitcoin increased and 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 decreased and the average block size of Bitcoin decreased. The average number of transactions per block increased but the average block size of Ethereum decreased this week. The average transaction fees of Bitcoin decreased and Ethereum decreased. CARD was the most active project on GitHub this week.

The average bitcoin Hashrate for the entire network reached 134.8EH/s, increased by 6.73% from the previous week. Average Hashrate for the entire Ethereum network was 690.84TH/s this week, increased by 4.42%. Average difficulty for mining Bitcoin this week was 17.95T, increased by 1.93% from last week. The average difficulty of mining Ethereum this week was 8794.98TH, increased by 4.41% from that of previous week.

In network activity, the average size of each block was 1.06MB, decreased by 6.19% from last week; there were on average 1703 transactions recorded in each block, decreased by 4.11% from the previous week. The average number of transactions per block in Ethereum this week was 188.9, increased by 1.56%. The average size of each block was 73062.00 bytes, decreased by 7.05% compared to last week. Average transaction fees of Bitcoin this week was $2.252, decreased by 14.63% from last week. Average transaction fees of Ethereum this week was $17.859, decresead by 56.42% from last week. The total number of Bitcoin addresses was 76490816, increased by 168043 (0.22%). Cardstack was the most active project on GitHub this week, with 64 commits submitted in the past week.

1. Weekly Market Review

1.1 Market overview

This week, the overall market capitalization for the top 100 cryptocurrencies decreased of 11.22%, with 70 projects decreased in value to varying degrees. According to coinmarketcap, as of September 12, 2021, the total market cap of cryptocurrencies was 2075.7 billion U.S.dollars, decreased of 11.22%, and the total market cap of the top 100 cryptocurrencies was 2060.6 billion U.S. dollars, decreased by 9.56% from last week, among which, ALOG had the largest increased of 168.47%, bringing its market cap ranking from №39 to №15, XEC had the largest decreased of -29.34%, bringing its market cap ranking from №203 to №42. In addition, there were 5 projects that entered TOP100, namely, XEC (eCash, decreased 29.34, Now №42), CRV (Curve DAO Token, decreased 1.89%, Now №95), MINA (Mina, increased 23.40%, Now №94), IOST (IOST, increased 31.62%, Now №83), RAY (Raydium, increased 32.72%, Now №93). As of September 12, 2021, Bitcoin was traded at 46063.27USD, 10.96% lower than its price last week. Ethereum was traded at 3410.13USD, 13.64% lower than its price last week.

The overall 24h trading volume decreased this week. Overall, the 24h trading volume decreased by 6.91% compared with the same period of last week. In this week, 29 of the top 100 projects increased in 24h trading volume, led by EGLD with a weekly increased of 1007.31%; there were 70 projects decreased in their 24h trading volume, there were 55 projects that saw over 20% decrease in their 24h trading volume, while 28 projects fell by more than 50%. The most decresed project led by ETC, with a decreased of -89.49%.

The top 10 cryptocurrencies’ market value decreased, the market share distribution remained stable. On September 12, 2021, the overall market cap of the top 10 cryptocurrencies was 1689.1 billion USD, decreased by 10.50% from last week, accounting for 81.38% of the total market capitalization of cryptocurrencies, increased by 0.66% from last week. The market value proportion of TOP10 project basically stable. BTC’s dominance was 41.75%, increased by 0.12% from last week.

1.2 Segment Analysis

Among TOP 100 cryptocurrency project segments, the total market cap of Application project got the largest decrease. The average market cap of Asset-backed project got the largest decrease. As of September 12, 2021, the total market cap of coin projects reached 1201.8 billion USD, decreased by 7.80%. The average market cap of coin projects reached 23.1 billion USD, decreased by 11.34%. The total market cap of platform projects reached 600.8 billion USD, decreased by 12.31%. The average market cap of platform projects reached 26.1 billion USD, decreased by 4.68%. The total market cap of application class projects reached 187.3 billion USD, decreased by 15.53%. The average market cap of application class projects reached 8.51 billion USD, decreased by 11.69%. The total market cap of asset-backed token projects reached 70.7 billion USD, increased by 3.69%. The average market cap of asset-backed token projects reached 23.5 billion USD, decreased by 30.87%.

The market segment distribution of the top 100 cryptocurrencies remained stable. As of September 12, 2021, among the top 100 projects, the number of coin class projects increase 2, asset-backed token class projects both increase 1, platform class decrease 2, application class projects decrease 1. The largest overall market cap by segment was still coin projects, accounting for 58.32% 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 and Ethereum increased by this week. From September 6, 2021- September 12, 2021, the average bitcoin Hashrate for the entire network reached 134.8EH/s, increased by 6.73% from the previous week.

Average Hashrate for the entire Ethereum network was 690.84TH/s this week, increased by 4.42%.

This week, the difficulty of mining Bitcoin increased and Ethereum increased. As of September 12, 2021, average difficulty for mining Bitcoin this week was 17.95T, increased by 1.93% from last week. The average difficulty of mining Ethereum this week was 8794.98TH, increased by 4.41% from that of previous week.

The number of blocks in Bitcoin increased by 1.76%,Top 5 rankings had changed. The overall distribution of the Ethereum mining pools rankings not changed, the number of blocks increased by 0.62%. In the past week, Bitcoin mined 1039 blocks, increased by 1.76% from the previous week. Among the top four pools were AntPool、Poolin、F2Pool、ViaBTC, these 4 pools mined 162、143、140 and 119 blocks respectively, accounting for 15.59%、13.76%、13.47% and 11.45% of all Bitcoins mined this week. The Hashrate was 20.81EH/s、18.37EH/s、17.98EH/s and 15.28EH/s, respectively.

In the past week, Ethereum’s entire network mined 48235 blocks, increased by 0.62% in the previous week. The top five pools were Ethermine, Spark Pool, F2pool Old, Hiveon Pool and BeePool, each mined 10073、9819、5357、2914 and 2861 blocks respectively, accounting for 20.8832%、20.3566%、11.1060%、6.0413% and 5.9314% 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 but the average block size of Ethereum decreased this week. According to blockchain.info, from September 6, 2021- September 12, 2021, the average size of each block was 1.06MB, decreased by 6.19% from last week; there were on average 1703 transactions recorded in each block, decreased by 4.11% from the previous week.

According to etherscan, the average number of transactions per block in Ethereum this week was 188.9, increased by 1.56%. The average size of each block was 73062.00 bytes, decreased by 7.05% compared to last week.

Number of unconfirmed transactions in Bitcoin decreased by 12.10%. Number of unconfirmed transactions in Ethereum increased by 3.68% from the previous week. As of September 12, 2021, the number of 7-day average unconfirmed transactions in Bitcoin network was 4612, decreased by 12.10% from last week. There were 166987.48 unconfirmed transactions in the Ethereum network, increased by 3.68% from last week, with the lowest amount of unconfirmed transactions in the week being 130342 and the highest amount being 188742.

Total transaction fees of Bitcoin decreased and Ethereum decreased. As of September 12, 2021, average transaction fees of Bitcoin this week was $2.252, decreased by 14.63% from last week. Average transaction fees of Ethereum this week was $17.859, decresead by 56.42% from last week.

The average number of distinct miners per day in Ethereum decreased. From September 6, 2021- September 12, 2021, the average number of distinct miners per day in Ethereum this week was 42.1, decreased by 5.39% from last week.

The number of nodes in Bitcoin increased by 5.97% ,The number of nodes in Ethereum decreased by 26.77% this week. As of September 12, 2021, there were 10669 Bitcoin nodes, increased by 5.97% compared to last week, of which 1837 nodes were in Germany, 1821 nodes were in U.S, and 155 nodes were in China(№10), each accounting for 17.22%, 17.07% and 1.45% of the total number of Bitcoin nodes, respectively.

As of September 12, 2021, there were 3649 Ethereum nodes, decreased by 5.61% from the previous week. Specifically, there were 1200 nodes in the U.S, 569 nodes in Germany, and 314 nodes in China, each accounting for 32.89%, 15.59%, 8.61% 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 September 12, 2021, the total number of Bitcoin addresses was 76490816, increased by 168043 (0.22%).

CARD was the most active project on GitHub this week. From September 6, 2021 — September 12, 2021, Cardstack was the active project repository on GitHub with a total of 64 commits.

2.3 Community Activity Statistics

The top three most popular cryptocurrencies on Facebook were Tron, Bitcoin and Ethereum in descending order, with 946k, 625k and 234k fans respectively. The top three most popular cryptocurrencies on Twitter were Bitcoin, Ripple(XRP) and Ethereum, with 3.1million , 2.0million, and 1.5million followers, respectively.

3. Weekly Blockchain Dynamics

3.1 Mainstream project dynamics

1. Polka is about to release the cross consensus message format XCM

Gavin wood, co-founder of Polka, said that XCM, a cross consensus message format, would be released soon.XCM is a message passing format rather than a message passing protocol. It can be used to express what the message receiver should do instead of actually sending messages between different systems. In Polka, XCM can express the meaning of messages on three communication channels: relay chain to parallel chain, parallel chain to relay chain and parallel chain. XCM can be used for cross chain token transfer, payment fee selection and platform specific operations using xcm language in the future.

2. Ethereum’s capacity expansion plan has broken through US $200 million in arbitrum network lock up

As of September 10, the network lock up volume of Ethereum capacity expansion solution arbitrum exceeded US $200 million, which is currently US $238.8 million, an increase of 354.43% in the past 7 days, nearly double the previous day. At present, arbitrum ranks second in terms of lock up volume in Ethereum L2 network. The first place is still dydx (US $316 million), optimization (US $136.5 million) and loopring (US $127 million, of which 44.98% are native tokens LRC).

3. Solana’s lock up volume exceeded US $7.5 billion, ranking third in all public chains, reaching an all-time high

According to DeFi Llama data (September 9), Solana’s lock up volume exceeded US $7.5 billion, ranking third in all public chains, a record high. Meanwhile, coingecko data show that the 24-hour trading volume of raydium, a DEX project of Solana ecology, has exceeded US $800 million, ranking second in dex trading volume. Currently, the first place is uniswap V3 ($1.764 billion).

3.2 International industry dynamics

1. Bitcoin officially became the legal currency of El Salvador

At 00:00 on September 7, El Salvador time, bitcoin officially became the legal tender of El Salvador and circulated in the market together with the US dollar. On the same day, chivo, the country’s digital currency wallet, failed, and any attempt to enter data would report an error. The official increased the capacity of the server, disconnected the system, and called on users to wait for the problem to be solved and return to normal in five hours. In addition, El Salvador has purchased 550 bitcoins in batches. Bancoagricola, a Salvadoran financial institution, partnered with flexa, a digital payment startup, to adjust its infrastructure to provide bitcoin services. The integration will allow Salvadorans to use basic banking services, whether they choose bitcoin or US dollars. Bancoagricola began to support bitcoin loans, credit cards and commercial goods and services in order to comply with the bitcoin law as soon as possible. McDonald’s and Starbucks franchise stores in El Salvador began to accept bitcoin payments. Flexa, a payment company, announced that it supports bitcoin lightning network. Businesses using flexa can accept payments in stores, apps and online through lightning network in a compliant and fraud proof manner. At present, the flash online payment supported by flexa is launched among specific partners and merchants in El Salvador, and is expected to be promoted to all flexa merchants in the coming weeks.

2. Grayscale announced that its grayscale bitcoin cash trust (BCHG), grayscale Ethereum classic trust (ETCG) and grayscale Wright coin trust (LTCN) have become sec reporting companies

It is reported that the three funds must provide financial statements and disclosures to the SEC on a regular basis and comply with all requirements stipulated in the securities law. At the same time, this also means that at this stage, six cryptocurrency funds under grayscale (including the previous bitcoin trust fund GBTC, Ethereum trust fund Eth and grayscale digital market fund gdlc) will be regulated by the SEC in a way similar to the listed companies on national stock exchanges such as NASDAQ or New York Stock Exchange. According to previous reports, gray Ethereum trust has become an SEC reporting company in 2020.

3. Visa is working with traditional Brazilian banks ZrO bank, alterbank and rippio to issue cryptocurrency cards

It is reported that payment giant visa said in an interview recently that the great advantage of using bitcoin lies in its ease of use. Visa is currently cooperating with traditional Brazilian banks ZrO bank, alterbank and rippio to issue encrypted currency cards, allowing them to be connected to bank accounts. In addition, visa is also developing a B2B (business to business) blockchain that will allow payment and settlement between companies using smart contracts.

3.3 Industry regulatory dynamics

1. The concept of “Metaverse” swipes the screen of a shares, and the exchange makes an emergency shot

The concept of Metaverse became popular in the A-share market. Several stocks rose by the limit, and the concept stock of Metaverse tom cat rose 34%. Subsequently, the company received a letter of concern from Shenzhen Stock Exchange, which asked to explain the relevance of the company’s existing main business, main products and the concept of Metaverse, and whether the company used interaction and reply to rub hot spots and speculation concepts to cooperate with shareholders’ reduction. On the evening of September 10, Tom Cat replied to the attention letter that there is a big gap between the company’s current game products and the theoretical Metaverse, product iteration and new product exploration are still in the early stage, and there is great uncertainty about the project implementation progress, whether it can achieve the expected effect of the company and whether it can meet the needs of the future market. Affected by this, Metaverse concept stocks fell.

2. European Securities and Markets Authority (ESMA): cryptocurrency and its technology are financial innovations. At the same time, DeFi and stable currency increase the risk of the financial system

The European Securities and Markets Authority (Esma) issued a report on financial trends and risks, saying that encrypted assets and distributed ledger Technology (DLT) were at the forefront of Esma’s Financial Innovation Scoreboard in 2021. In terms of risk, the report also said that the energy consumption of DLT agreement (intensive mining) is a source of environmental problems; Encryption assets are highly volatile; Although defi has disintermediation, 24x7 availability and anti censorship, it has risks in operational flexibility, scalability and governance; The use of CBDC and stable currency and the increasing interest of institutional investors in encrypted assets are blurring the boundary between the centralized traditional financial system and defi, thus increasing the risk of potential overflow of defi risk to the real economy. The report also shows that the EU’s upcoming regulatory framework for the encrypted asset market (MICA) will apply to 27 member states, including restrictions on stable currencies.

3. The Ministry of Finance of US discuss the regulation of stable coin with financial executives

It is reported that at a meeting this week, U.S. officials asked whether direct supervision is needed if the stable currency becomes very popular. They also discussed how regulators should try to reduce the risk of too many people exchanging stable currencies at the same time, and whether the main stable currencies should be supported by traditional assets. The information gathered at this week’s meeting may help the Ministry of Finance prepare a comprehensive report on the stabilization currency in the coming months.

4.Weekly Investment Activities

This week’s investment and financing decreased by 60% compared with last week, and the total amount of 19 financing was 104 million dollars. This week’s financing events focused on tool applications, NFT and gamefi. The largest amount of financing was the transaction monitoring software company eventus systems, which completed a round B financing of US $30 million.

Huobi Research

About Us:

The Huobi Blockchain Application Research Institute (referred to as ‘Huobi Research’) was established in April 2016. Since March 2018, it has been committed to comprehensively expanding research and exploration in various fields of blockchain. The research institute takes the pan-blockchain field as the research object, aimed to accelerate the research and development of blockchain technology, promote the application of the blockchain industry, and promote the ecological optimization of the blockchain industry. The main research content of the institute includes industry trends, technology paths, application innovation, and model exploration in the field of blockchain. In line with the principles of public welfare, rigor and innovation, Huobi Research Institute will carry out extensive and in-depth cooperation with government, enterprises, universities and other institutions through various forms. We are building a research platform covering the complete industrial chain of the blockchain, providing a solid theoretical basis and trend judgment for the blockchain industry professionals, and promoting the healthy and sustainable development of the entire blockchain industry.

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Blockchain industry top think tank, affiliated to Huobi Group.

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