• Corpus ID: 4898563

Classification of crypto-coins and tokens from the dynamics of their power law capitalisation distributions

@inproceedings{Wu2018ClassificationOC,
  title={Classification of crypto-coins and tokens from the dynamics of their power law capitalisation distributions},
  author={Ke Wu and Spencer Wheatley and Didier Sornette},
  year={2018}
}
We empirically verify that the market capitalisations of coins and tokens in the cryptocurrency universe follow power law distributions with significantly different values, with the tail exponent falling between 0.5 and 0.7 for coins, and between 1.0 and 1.3 for tokens. We provide a rational for this, based on a simple birth-proportional growth-death model previously introduced to describe firms, cities, webpages, etc. We validate the model and its main predictions, in terms of proportional… 

Figures and Tables from this paper

Classification of cryptocurrency coins and tokens by the dynamics of their market capitalizations
TLDR
The results clearly characterize coins as being ‘entrenched incumbents’ and tokens as an ‘explosive immature ecosystem’, largely due to massive and exuberant Initial Coin Offering activity in the token space.
Are Bitcoin bubbles predictable? Combining a generalized Metcalfe’s Law and the Log-Periodic Power Law Singularity model
TLDR
The LPPLS model is shown to provide an ex ante warning of market instabilities, quantifying a high crash hazard and probabilistic bracket of the crash time consistent with the actual corrections; although, as always, the precise time and trigger is exogenous and unpredictable.
Dissection of Bitcoin’s multiscale bubble history from January 2012 to February 2018
TLDR
A robust automatic peak detection method is introduced that classifies price time series into periods of uninterrupted market growth (drawups) and regimes of uninterrupted Market decrease (drawdowns) and a predictive scheme provides useful information to warn of an imminent crash risk.
Dissection of Bitcoin's Multiscale Bubble History
TLDR
A robust automatic peak detection method is introduced that classifies price time series into periods of uninterrupted market growth (drawups) and regimes of uninterrupted Market decrease (drawdowns) and a predictive scheme provides useful information to warn of an imminent crash risk.
Are Bitcoin Bubbles Predictable? Combining a Generalized Metcalfe's Law and the LPPLS Model
We develop a strong diagnostic for bubbles and crashes in bitcoin, by analyzing the coincidence (and its absence) of fundamental and technical indicators. Using a generalized Metcalfe's law based on
Machine Learning the Cryptocurrency Market
TLDR
It is shown that simple trading strategies assisted by state-of-the-art machine learning algorithms outperform standard benchmarks and can help anticipate the short-term evolution of the cryptocurrency market.
Anticipating Cryptocurrency Prices Using Machine Learning
TLDR
It is shown that simple trading strategies assisted by state-of-the-art machine learning algorithms outperform standard benchmarks and can help anticipate the short-term evolution of the cryptocurrency market.
Hyperbolic Graph Neural Networks
TLDR
A novel GNN architecture for learning representations on Riemannian manifolds with differentiable exponential and logarithmic maps is proposed and a scalable algorithm for modeling the structural properties of graphs is developed, comparing Euclidean and hyperbolic geometry.

References

SHOWING 1-10 OF 30 REFERENCES
Evolutionary dynamics of the cryptocurrency market
TLDR
It is revealed that, while new cryptocurrencies appear and disappear continuously and their market capitalization is increasing (super-)exponentially, several statistical properties of the market have been stable for years.
Do the Rich Get Richer? An Empirical Analysis of the Bitcoin Transaction Network
TLDR
Investigating the microscopic statistics of money movement, it is found that sublinear preferential attachment governs the evolution of the wealth distribution and a scaling law between the degree and wealth associated to individual nodes is reported.
Cryptocurrency : how Bitcoin and digital money are challenging the global economic order
The system that governs how money works, with its brokers and middlemen, has stayed roughly the same for centuries. Now there's an alternative, and it puts us on the cusp of a revolution that could
The evolution of the bitcoin economy
This paper aims to gather together the minimum units of users’ identity in the Bitcoin network (i.e. the individual Bitcoin addresses) and group them into representations of business entities, what
Testing the Pareto against the lognormal distributions with the uniformly most powerful unbiased test applied to the distribution of cities.
TLDR
The UMPU test is advocated as a systematic tool to address similar controversies in the literature of many disciplines involving power laws, scaling, "fat" or "heavy" tails, and in order to demonstrate that the procedure works for data sets other than the US city size distribution.
The Economics of Cryptocurrencies – Bitcoin and Beyond
TLDR
The optimal design of cryptocurrencies is studied and quantitatively how well such currencies can support bilateral trade is assessed and it is pointed out that cryptocurrencies can potentially challenge retail payment systems provided scaling limitations can be addressed.
ON A CLASS OF SKEW DISTRIBUTION FUNCTIONS
It is the purpose of this paper to analyse a class of distribution functions that appears in a wide range of empirical data-particularly data describing sociological, biological and economic
Do Bitcoins make the world go round? On the dynamics of competing crypto-currencies
TLDR
It is suggested that perception of value in a social system is generated by a voter-like dynamics, where fashions form and disperse even in the case where information is only exchanged on a pairwise basis between agents.
Opinion: Valuation, liquidity price, and stability of cryptocurrencies
TLDR
It is unlikely that cryptocurrencies in their current form will be stable in the absence of a mechanism of a link to value, since tangible value of a typical cryptocurrency is non-existent.
Experience versus talent shapes the structure of the Web
TLDR
The balancing act between experience and talent on the web allows newly introduced pages with novel and interesting content to grow quickly and surpass older pages, much like what the authors observe in high-mobility and meritocratic societies.
...
...