BlockchainDefender has released a report outlining the ways in which a lack of trust affects the global market capitalisation of the cryptocurrency industry. This report willbe a useful tool for cryptocurrency and blockchain-related organisationsthat wish to better understand the online sentiment regarding their companies and crypto in general, and those that wish to improve their online reputation.
The Correlation Between Market Sentiment and Market Capitalisation
Of the three studies within the BlockchainDefender report, the first focuses mainly on the titular issue of correlation between a lack of trust and market capitalisation.
BlockchainDefenderresearched cryptocurrencies in the United States, United Arab Emirates, Japan and Germany. Those specific countries all already have large crypto markets which are growing. In its analysis, BlockchainDefenderlooked at two pages of Google search results for each cryptocurrency, categorising the results by sentiment.
The results indicate that when positive sentiment regarding cryptocurrencies increases, so too does global market capitalisation. Bothoccurrences also positively correlate with an increase in Google searches for digital currencies. The opposite is also true, with a decrease in Google searches and an increase in negative online sentiment leading to lower global market capitalisation.
Comparisons of Online Sentiment
The BlockchainDefender report continues by comparing the online sentiment across the same four countries. The analysis indicates that the United States has the highest amount of negative online sentiment in the search results, followed by Germany, the United Arab Emirates and Japan.
Next, BlockchainDefenderanalysedthe online sentiment towards Bitcoin in those same countries. The most positive search results were, in order, the UAE, Germany, the US and Japan. The most negative results were, in order, the US, Germany, the UAE and Japan.
The report also compares the online reputation of cryptocurrency exchanges to traditional trading exchanges. The research discovered that traditional exchanges have greater control over their reputations online. This is largely due to positive ownership via the exchanges’ own websites and social media pages. Crypto exchange ownership is nearly half that of traditional exchanges. This leads to less control over online sentiment.
Cryptocurrencies in Crisis
Finally, the BlockchainDefender reportincludes an online reputation case study of a cryptocurrency that faced a crisis in 2018. The research analysed brand search terms in five countries both before and after the crisis. Negative content increased following the crisis while positive content decreased. Additionally, the West experienced a significant swing in negative sentiment when compared to the East.
The cryptocurrency industry trust report can be viewed on SlideShare or downloaded as a digital eBook.