Pivot ERC20 Altcoin: Most high-yield tokens are concentrated

Two-thirds of the past 2019 has passed, except for Bitcoin, which has experienced a small climax in the middle of the year. The cryptocurrency market is generally in a tepid state, and there is no big bull market that we have been waiting for for a long time. Year-to-date, bitcoin rose about 170% (YTD), Ethanol rose about 64% (YTD), XRP fell 16% (YTD), bit cash rose 113% (YTD), and EOS rose about 51% (YTD). The rest of the small-capacity altcoins are mostly in a downturn, but there are also many star projects that show off their eyes.

LongHash attempts to discover small-capital tokens that have performed well this year by analyzing the ERC20 tokens issued at Ethereum. In this study, we selected the top 1000 tokens of the ERC20 market value, but excluded the tokens and stable currencies with a market value of more than $1 billion, for a total of about 900 tokens. We analyze these tokens from multiple dimensions, including price, annualized rate of return from 2019 to date, volume of transactions, number of currency holders, market capitalization, and concentration of token distribution. The concentration of token distribution is calculated as the ratio of the total number of coins held in the top 20 addresses of each token to the total circulation of the currency, but the exchange address and the currency and the destruction currency address are removed.

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Among the tokens we analyzed, there were 12 market capitalizations with more than $100 million, 81 between $10 million and $100 million, and 813 tokens under $10 million. From a yield perspective, more than half of the token yields are negative, but 38 tokens yield more than 500%.

These 38 amazing tokens have a high degree of token distribution. Most of them are more than 60% concentrated, and some even more than 90%. Of course, there is no direct correlation between the yield of tokens and the concentration of distribution, but generally we believe that the smaller the market value of tokens and the higher the concentration of distribution, the more favorable the marketer is to manipulate prices. However, we also found that the increase in the value of some large-capital tokens is also amazing. For example, the market value of LINK is about 600 million US dollars, the annualized income is close to 10 times; the other currency INO market value is 370 million US dollars, the annualized income is more than 26 times, and the distribution of tokens is also as high as 88%.

We conducted a correlation analysis on the attributes of price, annualized rate of return, transaction volume, number of currency holdings, market value, and concentration of token distribution.

As shown above, the left side is the correlation of all 900 coins, and the right side is the correlation of the market value of less than 10 million US dollars. As can be seen from the left figure, there is a certain correlation between the rate of return and the market value and trading volume, while the concentration of token distribution is ranked third, and the correlation with the yield is only 0.076. However, when only the tokens with a market value of less than $10 million are considered, the correlation between the remaining attributes and the rate of return is decreasing, and only the attribute concentration of the token distribution is increased. This shows that the more concentrated the small market value token chips, the more likely it is to obtain high returns.

Author / Xianyue Wu

Data visualization / Xinhe Yu

Source / LongHash

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