CoinGecko is a 5-year crypto data aggregator. Starting from April 2014, they have checked the price, market cap, trading volume for Bitcoin, Ethereum, Litecoin… and more than 5.500 cryptocurrencies. CoinGecko is also plotting to 370 exchanges.
At Invest: Asia by Coindesk, Bobby Ong, co-founder of CoinGecko had a great presentation about the “State of Blockchain in Asia” and more than that.
Let's meet this young and excellent man to learn more about the development of Blockchain in Asia and get the prediction for the crypto market in the rest of 2019.
Question 1: Could you give us an overview of the blockchain market in Asia at present?
In Singapore, I have a good opportunity of opening this conference (Invest: Asia) by giving the first presentation which was the state of the crypto market in Asia. So, in my presentation, I talked about 3 main points.
The first is that mining and validating is a very much agent-centric ecosystem these days. Five years ago, most of the mining pools are Western-dominated. There was only one largest Asia mining pool for Bitcoin. These days, 80% of mining is happening in Asia, more specifically China. In the top 10 mining pools, the majority are from China and only 2 is non-China.
The second main point is the group of exchanges. In the last 1.5 year, we saw a 706% increase in exchanges tracking on Coingecko. In January 2018, we only track 45 exchanges. By July 2019, we have 363 exchanges. 40% of the new 318 exchanges come from Asia. A large percentage of them registered in Europe and Latin America but these are Asian exchanges. They registered in countries like Seashells the British Virgin Islands, Malta and Cayman Islands. So, if you put all these Asia exchanges together, actually the number is like higher than 50%.
The third main point is innovation. A lot of projects came from Asia. A lot of new exchanges, new ICOs, a lot of innovations come out of Asia. I gave some very good examples during my presentation. For example, Binance and the innovation of exchange token — BNB. Of course, we are Asia, we sort of take it for granted exchange should have an exchange token but it’s only in Asia. This is a common phenomenon “every exchange has its own token”. It is a big phenomenon, a big innovation by Binance. Because it creates a lot of loyalty for traders to trade on Binance, thus, there are 2 main utilities: trading fee discount and quarterly token burn. Moreover, Binance also put a lot of utilities on this token, such as the IEO model, Binance Chain.
Another example is the mining machine. It is an open market, anyone at anywhere in the world can create the best hardware to mine Bitcoin. Though, Bitmain — an Asian company based out of China has built the best machines in the world. They’ve grown big and now they’re just waiting to go for listing soon.
We should expect to see more and more innovations coming out of Asia in the next few years.
Question 2: What are the top 3 active blockchain markets in Asia in your mind now?
I think we’re very lucky to be living in the Asian region because we get all the information.
Asia is leading the world. The rest of the world is trying really hard to catch up.
You think about it right?
Asia has 4.4 billion people, China and India are 1.4 billion each and South East Asia where we are at has 600 million people so the largest market for blockchain and crypto in my past six years in involved in crypto space, in my opinion, is:
China is the biggest market in Asia by far followed very closely with the Japanese and Korean markets.
The dominance of China in driving the crypto market is totally big. Most of Bitcoin mining is done by Chinese miners. Most of ETH mining is done by Chinese miners. EOS has 21 block producers and 18 out of 21 are from China.
Japanese have very clear regulations. There are 19 licensed exchanges in Japan.
Korea has like over 100 unregulated exchanges but a lot of tokens are being traded there.
Question 3: You have just presented the state of blockchain and cryptocurrency in Asia. So, could you please share with us the state of Vietnam market from the data and your point of view?
Vietnam market is very interesting because there is a huge young population there. Also, based on my conversations with a lot of Vietnamese, Vietnamese have a love for speculation and high risk.
Therefore, I think the crypto market is like the perfect market designed for Vietnamese traders.
Vietnam is one of the top 10 that visit Coingecko. Besides, I have chances to speak to many exchanges in my work and a lot of them mentioned Vietnam as their key market. Hence, Vietnam is a key market for many of these players in the ecosystem.
Question 4: Do you have predictions for the project fundraising trend and the crypto market in the rest of 2019.
I think the ICO market is pretty much dead by the end of 2018 and everyone is looking to the IEO this year.
Therefore, in my opinion, in the first half from Jan to Jun this year, everyone is looking to IEO and the market deep very well.
And, I think this is going to be a struggle for the IEO market to sustain its momentum throughout the second half of this year.
From my point of view, we are starting to see exchange tokens falling down in prices and we know exchange tokens are required to be staked to participate IOE. Furthermore, people think there are not that many good projects out there to run IEO. Consequences, it is going to be a struggle for IEO fundraising.
That being said Coinbase has just announced yesterday that they are going to launch the IEO market. Actually, it is interesting because Coinbase is viewed as a very regulated exchange from the US. Indeed, I’m really surprised that they’re going into the IEO market.
If Coinbase manages to execute the IEO strategy, I think we may see the IEO trend sustained throughout the end of 2019. However, if they do not, it gonna be a struggle to find the catalyst for the IEO market for the second half of this year.
Question 5: Do you think that there exist differences between Blockchain projects in western countries to Asia countries? In terms of style, way of approaching the market, mindset.
I think there is a big difference in the way projects and teams operate between the Western group and the Asian group.
As I observed, the Western-centric team is more interested in solving the really hard technological issues. They wanna build infrastructure that will power the crypto economy for the next decades.
Whereas if we talk to Asian traders, Asian crypto teams, Asian exchanges, a lot of them are very focused on trading, investing, speculation. Maybe it is not a bad or good thing but that is a kind of observation that I notice.
Both are needed and that is why the crypto space is very interesting.
Question 6: I noticed that there are many crypto exchanges now. For example, at this conference, I have met almost exchanges and few blockchain projects. What do you think about this state?
I think this reflects the state of the current market where there are so many exchanges but very little quality projects. Of course, all exchanges are fighting really hard to get projects listed. Unfortunately, there is no good project.
Question 7: Coingecko has just released the Trust Score 2.0, what advantages that this new ranking system will bring to the blockchain space and the traders?
In the traditional market, report trading volume is a good indicator of exchange liquidity. We know how large exchange is based on a report trading volume.
Unfortunately, in the unregulated crypto space, exchanges are known to manipulate the numbers to appear that they are larger exchanges. So, they are doing wash trading, recruiting fake API data. They make the report trading volume being inflated far larger than what it is and this has called this number to be completely unreliable.
We believe that to get an idea of how large exchange is, or how liquid exchange is, we need to use alternative indicators. So alternative indicators to get 360 overview exchanges and some of the indicators that we have come up with are things like web traffic analysis, order book depth, Average Bid-Ask Spread, API grade analysis, cryptocurrency exchange reserve, some of the KYC policy.
This provides a more comprehensive overview of exchanges and it tells the traders something more about exchanges and their practices.
If they are doing good things, there is nothing to hide, but a lot of them are doing some a bit shady dubious stuff and this will be shown on our ranking algorithm.
Because it is an algorithm that ranks exchange from 1 to 10 points and it is the same method that is used to rank all the exchanges. So now you can see top exchanges on Coingecko are Binance, Coinbase, and other reliable exchanges.
Note: This is an interview I made in the name of tiendientu.org. For the Vietnamese version, please visit https://tiendientu.org/cofounder-coingecko-chau-a-dang-dan-dau-ve-blockchain
