Crypto Index Tracker: Crypto Markets In The Green
- By Bilal Hafeez and Dalvir Mandara
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- 3 min read
Crypto markets have been rallying after weeks of declines. The total crypto market cap now sits at around $982bn with bitcoin at a 41% dominance according to data from CoinGecko. Tech stocks picking up certainly helps, the NASDAQ recently registered a fourth straight day of increase, and crypto correlation to tech remains elevated. Crypto markets have given back some gains after US employment data came in better than expected today – nonfarm payrolls rose by 372,000 against an expected 268,000.
As for the performance of our various indexes, they are all in the green (Charts 1 and 2). Our Metaverse, DeFi, and Privacy Indexes are up the most at around 14%. Meanwhile, our Bitcoin and Smart Contract Indexes are up around 10% each.
Our DeFi index remains most correlated to bitcoin at 88% (Chart 3) and our Metaverse Index remains least correlated to bitcoin at 74%. Correlation between the remaining indexes and bitcoin are all down compared to last month. On macro markets, bitcoin’s correlation to tech increases compared to last month. Meanwhile, its correlation to Oil has come down (Chart 4).
- Smart Contract Platform Index: Avalanche (AVAX) is up the most at 21%. Terra (LUNA) is the only coin that is down at 1%. Ethereum is up 17%.
- DeFi Index: Thorchain (RUNE) is up the most at 29% followed by Aave (AAVE) at 26%. 1inch (1INCH) is down the most at 8%.
- Metaverse Index: The Virtua Kolect (TVK) is up the most at a staggering 65% followed by The Sandbox (SAND) at 14%. Phantasma (SOUL) is the only coin that is down at 1%.
- Privacy Index: All coins in this index are in the green. Horizen (ZEN) is up the most at 31% and Keep Network (KEEP) is up the least at 3%.
- Bitcoin: this is up 10%.
What Are in the Four Indices?
Here are the indices in more detail:
- Bitcoin: the OG of crypto markets deserves its own category and is in many ways the true benchmark for any other crypto market.
- Smart contract platforms: after bitcoin, the big innovation was to have blockchains that were more programmable. These could host smart contracts or decentralised applications and have allowed the emergence of the metaverse and defi. Ethereum (ETH) is the most popular version of a smart contract platform. As well as ethereum, we also include some key competitors. The constituents of this index are: Ethereum (ETH), Cardano (ADA), Avalanche (AVAX), Solana (SOL), Fantom (FTM), VeChain (VET), Terra (LUNA), EOS (EOS), and Chainlink (LINK). We also include Polkadot (DOT) which allows interoperability between blockchains and the use of smart contracts via parachains.
- Metaverse: coins associated with the creation of a virtual space/digital world on the internet using a combination of augmented reality, virtual reality, and social networks. The constituents of this index are Axie Infinity (AXS), The Sandbox (SAND), Decentraland (MANA), Enjin Coin (ENJ), Aavegotchi (GHST), Terra Virtua Kolect (TVK), Ultra (UOS), Phantasma (SOUL), RedFOX Labs (RFOX), and Gala (GALA).
- Decentralised Finance (DeFi): financial services built on top of blockchain networks with no central intermediaries. This can be a broad category, so we narrow this down to platforms that focus on lending/borrowing, yield farming, automated market making and decentralised exchange tokens. The constituents of this index are: Aave (AAVE), Compound (COMP), Uniswap (UNI), Yearn.finance (YFI), Loopring (LRC), PancakeSwap (CAKE), Maker (MKR), 1inch (1INCH), Thorchain (RUNE), and Terra (LUNA).
- Privacy Coins: coins that obscure transactions on the blockchain to maintain the anonymity of its users and their activity. The constituents of this index are Monero (XMR), Zcash (ZEC), Dash (DASH), Verge (XVG), Horizen (ZEN), Beam (BEAM), Secret (SCRT), Decred (DCR), Keep Network (KEEP), and Dusk Network (DUSK).
Dalvir Mandara is a Quantitative Researcher at Macro Hive. Dalvir has a BSc Mathematics and Computer Science and an MSc Mathematical Finance both from the University of Birmingham. His areas of interest are in the applications of machine learning, deep learning and alternative data for predictive modelling of financial markets.
Bilal Hafeez is the CEO and Editor of Macro Hive. He spent over twenty years doing research at big banks – JPMorgan, Deutsche Bank, and Nomura, where he had various “Global Head” roles and did FX, rates and cross-markets research.