Mar 16, 2019 10:15 UTC
Mar 16, 2019 at 11:03 UTC
How Does Cryptocurrency Gain Value?
Where traditional investors have enough information to predict the movement of stocks and bonds, crypto invests, on the other hand, have it harder.
Bitcoin and Altcoins have not been around long enough to make clear movement patterns, yet we can see the number of major events which most likely to predict the gain in the value of cryptocurrencies.
When a blockchain split even happens, a race to grasp the attention begins. Demand begins to flow from search engines, faucets, price trackers, wallets, education sites, and the many services supporting a crypto economy.
What’s notable here is that the flows include almost every service that one needs to anticipate on any economy, even if they aren’t directly associated with cryptocurrency: jobs, art, entertainment, and so on. In simple words, the idea that what’s happening in the crypto market is only fueled by financial speculation is misleading.
There are thousands of sources shared by both Bitcoin and Bitcoin Cash over a period of 6 months, from August 2017 to January 2018.
It is clear how the distributions are different: Bitcoin captures the larger share of the overall traffic from most sources, while Bitcoin Cash has more sources which are mainly small contribution.
The market share of each attention economy is something that needs to be modulated by the contribution of each source. As we saw earlier, some sources have a disproportionately large weight.
The aggregated contribution from all the sources towards both Bitcoin and Bitcoin Cash, across 6 months of the period, is quite impressive. The dominance of a few sources is clear, while there are still hundreds of smaller contributors.
Share over Time
In order to understand the shape of the data better, there’s an array representing the passage of time, the first 200 sources, and the traffic intensity.
You May Also Read: How To Earn Bitcoins By Playing Games?
The first thing to be noted is that there are several fat arrays with too many variables and very few observations. It is a challenge by itself for most of the machine learning techniques unless an evolutionary algorithm is used.
You May Also Read: Do Bitcoin Earning Tips Really Work?
Digital assets detractors often say that there is no proven crypto demand, but the demand not only can be gauged, but that crypto-economies can be ranked as and when the demand evolves. Probably, the exercise of comparing Bitcoin and Bitcoin Cash isn’t entirely fair, yet the heuristics that we have learned from the data come with relevant applications nonetheless.
For example, one could identify what the sources of systemic importance are, or what traffic is overpriced or under price.
Since transactions on blockchain technology count and exchange volume, they can be faked by batching transactions and other tricks.
Here Are a Few Articles For You to Read Next: