Weekly Blockchain Industry Report-25th Issue:
By: Quqi Deng
Tags: Bitcoin, Crypto, Blockchain, ICO

(September 29th – October 5th, 2018)

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Market Overview

This week, the daily average global cryptocurrency’s market capitalization was $220.326 billion, representing a 0.82% increase from last week. Among them, the Top 5 cryptocurrencies’ market cap decreased by 0.17%;The daily average transaction volume was $14.4 billion, representing a 11.85% decrease. Meanwhile, the Top 5 cryptocurrencies’ transaction volume decreased by 15.41%. All of them experienced a experienced extreme price volatility with very low transaction volume.

Among the top 200 market cap cryptocurrencies , the biggest winner this week is DGTX in Platform Token field, its maximum price increase was 137.51%. Beside, in the top 10 winners, the projects in vertical chain and industry application field count more than 70%.

Top 10 winners this week

Analysis of Top 200 Market Cap Projects

Until 12:00 p.m. of the releasing date, the market capitalization of the top 200 projects decreased by 2.17% compared with last week. Based on our classification of 4 categories: cryptocurrency and payment, basic chain and protocol, vertical chain and protocol, and vertical industrial application, the projects of the both vertical chain and protocol sector and vertical industry application sector increased their market cap. Among them, vertical industrial application sector experienced highest price increase.

Through further classification of the vertical chain and protocol and the vertical industrial application sectors, it was found that transportation sector experienced market cap increase as high as 45.92%, but E-Commerce field’s market cap decreased by 48.46%.

Analysis of Newly Listed Projects

According to latest announcements from more than 30 exchanges including OKEx, Binance, Huobi, Bitfinex, Bithumb, ZB.com, Upbit, HitBTC, Bittrex, Poloniex, there are 2 newly listed cryptocurrencies and 4 newly listed trading pairs. Among them, MTC/BTC decreased in price by 33.2%.

Analysis of Closed Public Offering Projects

There have been 61 closed public-offering projects this past week, with the soft cap totaling nearly 400 million USD. Among these projects, Mcan Coin in health sector has the largest soft cap, exceeding 250 million USD.

List of closed ICO projects this week

List of closed ICO projects this week

List of closed ICO projects this week

List of closed ICO projects this week

List of closed ICO projects this week

Important News on Global Governmental Policies this Past Week

The US: The US Securities and Exchange Commission (SEC) issued an amendment rejecting the changes proposed by the CBOE BZX Exchange, and rejecting the Graniteshares Bitcoin and Short Bitcoin exchange-traded funds (ETFs).

The UK: The UK government recently discussed the necessity of blockchain regulation and whether this industry should be regulated by the Financial Conduct Authority (FCA). But with unclear Brexit prospects, London’s position as financial capital is facing challenges. Funds interested in blockchain projects are now moving to jurisdictions with clearer regulatory guidelines, of which Malta is the most important contender.

China: The government of Yunnan Province said that each year they will award subsidies to 5–10 blockchain technology teams.

Venezuela: A Petro White Paper recently released by the Venezuelan government shows that the country’s oil-backed cryptocurrency, the Petro, will not be 100% backed by oil, but rather 50% by oil, 20% by gold, 20% by iron, and 10% by diamonds.

Uganda: The Ugandan government is working with local companies to develop an energy economy based on blockchain. The local energy company CleanPath Emerging Markets Uganda (CPEM) has teamed with the Ministry of Energy and Mineral Development to enable citizens to purchase renewable energy using the digital currency DALA.

Israel: The Israel Securities Authority (ISA) has integrated blockchain technology to improve cybersecurity and tackle the challenges of information security. It has embedded blockchain technology in one of its systems, called “Yael,” which the regulator uses to communicate with its supervised entities.

Keeping Up with the Blockchain Giants

September 29th

Angel Versetti, CEO of Ambrosus, said that blockchain has created a precedent for pharmaceutical companies to transparently demonstrate the quantity of opioids they manufacture, where they are distributed, and the existence of sufficient demand.

September 30th

Google is currently lifting its crypto-related advertising ban, and it plans to allow regulated crypto exchanges to buy ads in the US and Japan. The new policy will be officially implemented this month.

October 1st

Ha Tae Keung, Councilman of South Korea’s Our Future party (우리미래, Woori Mirae), proposed an Electronic Financial Transactions Act Amendment, covering legitimate cryptocurrency transactions, agencies, and management. The Amendment allows for licensed ICOs, and proposes to establish a Cryptocurrency Issuance Review Board within the Finance Committee for audit and permits.

October 2nd

Apple co-founder and crypto lover Steve Wozniak said that crypto industry would take longer than expected to catch up to its early hype. Governments will regulate it.

October 3rd

Coinbase embedded economic incentives — Bitcoins — in its system to shorten Bitcoin transaction confirmation time.

October 4th

Circle has signed an agreement to acquire SeedInvest, an equity crowdfunding platform in the US. This acquisition will provide an open encrypted channel and infrastructure for businesses and individuals to crowdsource capital, and a security token market for interaction between investors.

October 5th

Time Magazine included the blockchain startup Bitland in its “50 Most Genius Companies” list. Bitland, one of the companies to first create a blockchain-based land registry, and the brainchild of Ghanaian resident Narigamba Mwinsuubo, uses a blockchain to create an irrefutable public record of land ownership.

Hot topic of this week: Turbulent Global Financial Markets and Widespread Lack of Confidence

During the Golden Week (a 7-day national holiday in China), the crypto market remained quiet, while global financial markets were turbulent due to political, economic and other reasons. First, US 10-year yields exceeded 3.2%, the highest level since 2011. European and American equity indexes subsequently shut down. The Nasdaq index fell 3.2% this week, the largest weekly decline since March. Hong Kong’s Hang Seng index lost 4.38% this week, the biggest weekly decline in seven months. At the same time, emerging markets collapsed. The bloodbath in global financial markets caused by the interest increase at the Fed has been proven.

Why Did the Fed Increase Rates?

On the one hand, the Fed has been executing a long-term policy of quantitative easing. With the recovery of employment this year, personal consumption expenditure growth, the core PEC price index, and August non-farm payrolls data all indicate that the economy is continuing to improve. The US wants foreign funds to return and to promote overseas capital to invest in the domestic market to further reduce unemployment and accelerate economic recovery.

On the other hand, the Fed is sensitive to the inflation index. As the economy grows, it is impossible to avoid increasing core inflation, therefore, the Fed has taken precautions to ensure that inflation remains around 2%.

Driven by the hawkish policy environment of increasing interest rates and a declining Fed balance sheet, 10-year US bond yields surged to 3.2%. As the global asset price benchmark rate continues to rise, the US dollar is driven up. For the financial markets, the magnitude of the rate change is not the most important, but rather the speed.

With large increases in such a short time, bonds are being sold off with growing speed, and overseas stock markets continue to fall. As the best risk-free investment in the world, US treasuries yields spiked, showing that market risk appetite is declining, and high volatile investment markets, like stocks, will be slowly abandoned.

The Impact of Rate Rise on the Global Economy

Countries around the world closely followed the Fed in raising rates. Argentina and Turkey continued to increase their rate to the highest levels in the world. The increasing rates in other emerging market countries have been termed “hopeless hikes,” because increasing rates harm the economy. Not doing so would however lead to sharp depreciations and a greater blows to the economy.

Even so, currencies of emerging markets have recently continued to crash. As of today, the Argentine peso has depreciated by nearly 50%, and the Turkish lira by 30%. This US rate increase is a major setback for global markets.

Why China Differentiated Itself by Cutting RRR

On the one hand, the US economy has recovered, with strong growth momentum, while on the other, the Chinese economy is facing huge downward pressure. According to the Manufacturing PMI (Purchasing Managers’ Index) released in September, manufacturing PMI has dropped to 50.8, Caixin PMI to 50, both sharp declines. Under such circumstances, China’s monetary policy must deal with the current economic downturn and inject appropriate liquidity into the financial system. Its main objective is to optimize the liquidity structure, enhance financial capabilities to serve the real economy, and thus stabilize domestic economic development.

Meanwhile, China’s previous reserve requirement ratio (RRR) is far higher than in the US and Europe, and there is large room for RRR cuts. In addition, the domestic real estate bubble is worrying. Blindly tightening monetary policy, or slowing down market liquidity injection, would lead to major turbulence in the property market, which relies on a regular supply of capital, exposing systemic financial risks. Therefore, the central bank’s RRR cut aims to stabilize housing prices and produce a soft landing.

Summary

Global financial markets have been waiting this week for good news to boost their confidence, and are expecting the bull market to return soon.

Appendix: Upcoming Crowdfunding Projects 10.06–10.12

List of upcoming ICO projects next week

List of upcoming ICO projects next week

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*Credits to Jin Li for her superb research!