CoinMarketCap, the leading source of cryptocurrency volumetric and financial data, has recently announced the acquisition of the team Hashtag Capital to make the most out of their algorithm, namely “true price”. But the question that has been on everyone’s mind is that; can this new acquisition can finally pave way for true crypto data?
For better development of their accountability of tokens and currencies on their platform, CoinMarketCap recently announced their project “Data Accountability and Transparency Alliance (DATA)” which focuses on the provision of meaningful data for the users which would help them better analyze a particular startup. The newly acquired team would solely focus on DATA’s liquidity-focused products.
Excited about the new acquisition and how it would help CoinMarketCap grow as an analyzing tool for cryptocurrencies, Brandon Chez, CEO of CoinMarketCap, states:
“We are excited to push the envelope on cryptocurrency pricing at CoinMarketCap, going beyond our traditional volume-weighted average prices to even more sophisticated price algorithms and analyses. The Hashtag Capital team will be able to add significantly to our data efforts and drive the next phase of CoinMarketCap in providing data products to the market.”
A little while ago, CoinMarketCap was accused of falsely portraying the volumes of certain currencies to bring them in a better place in the public eye. To rise above the accusations, CoinMarketCap opened the DATA project along with an announcement of CoinMarketCap block explorers, CoinMarketCap API revised plans and CoinMarketCap mobile apps.
CoinMarketCap currently determines the price of a cryptocurrency by the volume weighted average prices, according to their blog. Explaining further, the blog states:
“For example, an exchange that contributes 80% of the trading volume for a cryptocurrency will then have its price-weighted 80/20 against the other exchanges’ pricing for that cryptocurrency. CoinMarketCap aggregates from hundreds of exchanges, and we have always (and will always) make it a priority to include as many data sources as possible so that the global price averages are as accurate for our users as possible.”
This approach is being replaced by the new algorithm — ‘true price’ — that focuses on liquidity rather than volume weighted pricings. Again, to rise above the accusations, CoinMarketCap has made their move to make the listings more accurate with algorithms while explaining how the pricing is done and how cryptos are rated. The volume-based ratings of cryptos were also bashed by prominent names of the market. Mati Greenspan, senior market analyst at eToro, shared his views while talking to BlockPublisher:
Market cap is a flawed metric for evaluating crypto assets.
This might be a surprise to many because it is the metric based on which the currencies have been ranked on CoinMarketCap for a long time. CoinMarketCap was also previously accused of reaching out to startups to pay them and get listed on CoinMarketCap to make a better reputation for themselves. Refuting this sentiment, the team tweeted:
As a reminder, CoinMarketCap currently does not accept payment for listing coins/tokens/exchanges. We will NEVER reach out asking for a listing fee through e-mail or social media. Please be careful with your information and funds. Thank you.
— CoinMarketCap (@CoinMarketCap) August 8, 2018
Even though the accusation might not be true, CMC still has thousands of currencies listed on their platform, a few of which seem to be deteriorating with time. It has been said by experts time and time again that with the bear markets coming and going, the useless startups would eventually run out of money and funding and would run out of existence on their own.
In order to bring the company to new heights, CoinMarketCap has also decided to make promotions within the team. Carylyne Chan, former Head of Marketing and newly-appointed Chief Strategy Officer, quite excited about the promotion and the acquisition, states:
We are really excited about the future progress at CoinMarketCap! With the new data efforts we will be launching, in addition to our DATA Alliance, we will be able to provide a truly comprehensive platform for our users and customers, and pave the way for continued industry-wide involvement in crypto data development.