BlockchainDefender recently used its vast experience evaluating online reputations to analyse how a lack of trust can impact the cryptocurrency industry’s global market capitalization. Organisations related to cryptocurrency and blockchain will appreciate the report’s ability to explain online sentiment regarding crypto and its impact.
Examining the Link Between Market Capitalization and Market Sentiment
There are three studies within the BlockchainDefender report. The first study looks at the titular issue, the impact of a lack of trust on market capitalization. To conduct the analysis, BlockchainDefender analysed specific cryptocurrencies as well as the general crypto industry in the US, UAE, Japan and Germany. The team selected those countries for the presence and growth of cryptocurrency there. To collect data for analysis, BlockchainDefender examined two pages of Google search results for each cryptocurrency.
The report indicates that positive sentiment towards cryptocurrencies translates into higher global market capitalization of the industry and an increase in Google searches for cryptocurrencies. On the other hand, an increase in negative sentiment is connected to lower Google searches and a reduced global market capitalization.
Comparing Online Sentiment
To put the analysis into perspective, BlockchainDefender performed a comparison of online sentiment towards crypto across four countries. The analysis looked at the crypto industry as a whole and found the largest quantity of negative online sentiment originated from the US, followed by Germany, the United Arab Emirates and Japan.
From there, BlockchainDefender explored the online sentiment regarding Bitcoin. In order of negative impact, the countries were the United States, Germany, the United Arab Emirates and Japan. In order of positive impact, the countries were the United Arab Emirates, Germany, the United States and Japan.
Rounding out comparisons of online sentiment, BlockchainDefender analysed 10 cryptocurrency exchanges and 10 traditional exchanges. The traditional exchanges had more control over their online sentiment, largely thanks to their high amount of positive ownership. Cryptocurrency exchange ownership of content is almost half the figure for traditional exchanges, resulting in less control over online sentiment.
The final section of the BlockchainDefender report examines a cryptocurrency which was hacked in 2018 and faced a crisis as a result. Looking at search results in five countries prior to and following the crisis, the report indicates an increase in negative content and a decrease in positive content. The most interesting part of this section is that Eastern countries had a minimal change in online sentiment towards the hacked crypto, while Western countries had a dramatic change.