Evolutionary dynamics of the cryptocurrency market
Abeer ElBahrawy, Laura Alessandretti, Anne Kandler, Romualdo, Pastor-Satorras, Andrea Baronchelli

TL;DR
This study analyzes the entire cryptocurrency market from 2013 to 2017, revealing stable statistical properties and demonstrating that ecological neutral models can effectively describe its evolution.
Contribution
It provides the first comprehensive analysis of the entire cryptocurrency market and links ecological neutral models to its evolutionary dynamics.
Findings
Market capitalization grows super-exponentially
Number of active cryptocurrencies remains stable
Neutral ecological models reproduce key market features
Abstract
The cryptocurrency market surpassed the barrier of $100 billion market capitalization in June 2017, after months of steady growth. Despite its increasing relevance in the financial world, however, a comprehensive analysis of the whole system is still lacking, as most studies have focused exclusively on the behaviour of one (Bitcoin) or few cryptocurrencies. Here, we consider the history of the entire market and analyse the behaviour of 1,469 cryptocurrencies introduced between April 2013 and June 2017. We reveal 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. These include the number of active cryptocurrencies, the market share distribution and the turnover of cryptocurrencies. Adopting an ecological perspective, we show that…
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Taxonomy
TopicsComplex Systems and Time Series Analysis · Evolutionary Game Theory and Cooperation · Complex Network Analysis Techniques
