H2 2018 Crypto Report Highlights
The CoinShares Research H2 2018 Crypto Report is finally out, and per usual I’m posting a quick summary of the points we found most interesting about the second half of 2018:
- Bitcoin prices finished off 2018 as its worst year on record in percentage terms. While prices have fallen further from peak to trough in previous cycles, the close alignment of the 2017 market peak to the end of the year caused the 73% annual drawdown to make overall 2018 price performance the worst in Bitcoin history.
- The Ethereum hashrate fell by 35% over the course of Q3 and Q4. Litecoin fared even worse, with a total hashrate reduction of 41%. Out of our three PoW coins covered, only Bitcoin experienced growth in its hashrate, with an increase of 11% from July through December. While the hashrates of both Bitcoin and Litecoin have significantly recovered from their respective drawdowns, the Ethereum hashrate continues to fall.
- Total trade volumes fell drastically across all major trading pairs and exchange jurisdictions. In the Top 5 Markets by Volume, BTC volume fell by 58%, LTC by 78%, ETH by 70%, and — worst of the four — XRP by 82%. The United States and British Virgin Islands still dominate as hosting jurisdictions for trade volumes, followed by Korea, Japan and Luxembourg in various relative positions depending on trading pair.
- Market-relative KRW volumes of BTC and LTC were extremely large in October and November, accounting for more than 50% of total volume on our measured exchanges in November and almost 75% in October. By December, these volumes had normalised, with the KRW pairs again representing only a single digit percentage of total trades. Many theories have been offered as an explanation for this development, ranging from stock market mayhem driving investors into crypto, to Japanese traders flocking to Korean venues in the wake of Japanese exchange hacks, but we find no single adequate explanation fully satisfactory and therefore refrain from speculating further on causes.
- Volatility fell year-on-year for all four assets covered. As the wild price swings of 2017 gave way to the slow-bleed towards cycle bottoms during 2018, relative movement sizes shrank across all assets. If previous cycles are to afford any insight into likely developments of future cycles, we expect this trend to continue over the next few years as the market consolidates and recharges, before being broken either in the preceding- or in the peak-year of the next bull run.
New Research: H2 2018 Crypto Report. Everything you need to know from the back half of last year.
Download today: https://t.co/RVGbvw8rIs pic.twitter.com/hUUmM9SK5l
— CoinShares 👩🚀 (@CoinSharesCo) February 22, 2019
Please note that this Blog Post is provided on the basis that the recipient accepts the following conditions relating to the provision of the same (including on behalf of their respective organisation).
This Blog Post does not contain or purport to be, financial promotion(s) of any kind. This Blog Post does not contain reference to any of the investment products or services currently offered by members of the CoinShares Group.
Digital assets and related technologies can be extremely complicated. The digital sector has spawned concepts and nomenclature much of which is novel and can be difficult for even technically savvy individuals to thoroughly comprehend. The sector also evolves rapidly.
With increasing media attention on digital assets and related technologies, many of the concepts associated therewith (and the terms used to encapsulate them) are more likely to be encountered outside of the digital space. Although a term may become relatively well-known and in a relatively short timeframe, there is a danger that misunderstandings and misconceptions can take root relating to precisely what the concept behind the given term is.
The purpose of this Blog Post is to provide objective, educational and interesting commentary. This Blog Post is not directed at any particular person or group of persons. Although produced with reasonable care and skill, no representation should be taken as having been given that this Blog Post is an exhaustive analysis of all of the considerations which its subject matter may give rise to. This Blog Post fairly represents the opinions and sentiments of its author at the date of publishing but it should be noted that such opinions and sentiments may be revised from time to time, for example in light of experience and further developments, and the blog post may not necessarily be updated to reflect the same.
Nothing within this Blog Post constitutes investment, legal, tax or other advice. This Blog Post should not be used as the basis for any investment decision(s) which a reader thereof may be considering. Any potential investor in digital assets, even if experienced and affluent, is strongly recommended to seek independent financial advice upon the merits of the same in the context of their own unique circumstances.
The CoinShares Astronaut is a trademark and service mark of CoinShares (Holdings) Limited.
2019 CoinShares. All rights reserved.
Sign up for our monthly newsletterSubscribe
Our latest insights & research. Never spam.