Is it Time to Retire the Total Cryptocurrency Marketcap in Favor of Segments?

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There will always be different opinions on how accurate the cryptocurrency market cap really is. According to MicroStrategy’s Michael Saylor, it would be better to split this into three segments. An interesting approach that could shake things up significantly.

Rethinking the Cryptocurrency Marketcap Concept

Currently, the cryptocurrency marketcap is composed of everything counted as “projects in the cryptocurrency space”. This includes the obvious crypto assets, such as Bitcoin, Litecoin, Monero, and so forth. However, it also includes the “building blocks for applications and services”, such as Chainlink, Ethereum, and other similar projects. Plus, there are also the stablecoins, which  happen to be issued on various blockchains and traded against actual crypto assets. 

Assuming one were to adopt the vision of Michael Saylor, things will look very different. Crypto assets will still remain the biggest “category”, so to speak. 

Bitcoin’s valuation alone dwarfs all other projects currently accounted for in the cryptocurrency marketcap. Separating everything into three categories will only make the Bitcoin dominance a lot more apparent. At the same time, classifying the crypto assets together will provide a much better overview. 

Crypto Assets vs Platforms vs Cryptocurrencies

From the current market cap top 25, not too  many projects qualify as crypto assets. The list includes Bitcoin, Bitcoin Cash, Binance Coin, Litecoin, Bitcoin SV, Monero, Coin, Wrapped Bitcoin, OKB, LEO Token, and Huobi Token.  Removing the exchange tokens, that leaves just 7 crypto assets. Wrapped Bitcoin is an odd duck in the pond, so perhaps even just 6. Very interesting rankings indeed. 

Out of the same top 15, a fair few projects provide the necessary building blocks to create powerful platforms. Ethereum is the clear leader in terms of valuation there. Other projects on the “platforms” list include XRP, Chainlink, Polkadot, Cardano, EOS, TRON, Stellar, Tezos, NEO, and Cosmos. These are all very different from traditional crypto assets.

As far as actual cryptocurrencies go, things get a bit less interesting. Saylor thinks actual currencies – or assets tied to actual currencies – should be included here. Currently, this list includes Tether’s USDT, USD Coin, and cDAI. Not the most interesting list, but a remarkable one regardless. 

A Viable Idea, Sort of

Splitting the current cryptocurrency marketcap into three separate segments makes some sense, on paper. It all comes down to whether people consider the likes of Bitcoin and Litecoin to be actual crypto “currencies” or “assets”. One could argue the opposite too. Bitcoin is an actual crypto “currency”, whereas stablecoins and pegged currencies are “assets”. It makes for very interesting discussions regardless.

No one can deny the current cryptocurrency marketcap rankings are somewhat confusing. Especially for newcomers, it might not make much sense to see Tether in third spot, or 4 types of Bitcoin in the top 20. Of those 4, only two carry the same value, whereas the other two can largely be ignored. 

Whether this warrants creating separate lists, is a different matter altogether. It could be handy, of sorts, to create more segments and differentiation. Some of the projects currently in the cryptocurrency market cap have nothing to do with this industry bar for its technology. The value of its native token should, in theory, not even be in that overarching market cap in the first place. 

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