CryptoCompare Analysis: Most crypto-projects (including large cap coins like ETH, TRX, EOS) are governed centrally
One of the most important features of Bitcoin is that the crypto currency is not managed centrally. This prevents, for example, the system from being attacked by hackers at any point. In a new study, however, it emerged that most crypto assets are now centrally managed.
Taxonomy proves centralisation of the crypto market
Cryptocompare, a company that evaluates data on the crypto market, published its “Crypto Asset Taxonomy Report” a few days ago. The almost 80-page document offers investors, authorities and the industry an independent report on the classification of coins and tokens.
More than 200 crypto assets were evaluated for the study. More than 30 properties of coins and tokens were included. Among other things, the experts analysed issues such as regulatory intervention, access, market capitalisation and volume data, degree of decentralisation and distribution and supply concentration.
Charles Hayter, Managing Director of Cryptocompare, said:
“Daily, retail and institutional investment communities express an appetite to invest and develop investment products and instruments based on cryptoassets. Key to this is the demand for a single, independent and trustworthy taxonomy offering transparency, consistency and confidence.”
Only 16% of all crypto currencies are truly decentralized
The section on centralisation describes how public authorities could make their decision as to whether an investment is centrally managed and thus a security. One of the most important features is that decentralised and open-source projects are not put into circulation and controlled by a central source. With this definition, the team examined whether cryptographic facilities are centralised or decentralised.
The result was that only 16% of all crypto plants are truly decentralised. In contrast, 55% are managed by a central authority, while a further 30% are in an intermediate category. For “payment tokens”, which were defined by the experts as investments intended to serve as a means of payment or to offer an exchange of value, the figures look a little better. In this category, 37% of the survey found that they were decentralised.
Very good article. Cryptocompare really went all out with this one. Thanks for sharing.