Topic: CoinMarketCap & Co.: Should we change the ranking formula ? (Read 735 times)

Great idea !
Shall send this directly to the coinmarketcap's admin ?

Thanks for your comments !

I would make my own website but already working on one

Sure we can still find better formulas ! Their is so many factors, but we need stay simple and understandable by peoples ! I don't see which other could be included

I think better formula are possible.

But trading activity is only one of the factors.

What about a coin that is not traded a lot on exchanges but actually used to buy products.

Why don't you start your own website?

Would be a good idea

it's a good idea!

I think this is an excellent idea, and would certainly go some way towards stopping newcomers to the crypto-currency scene getting stung/manipulated.

Good point !

I'm taking CMC as example but he is not alone.

I really think this should change, especially for new comers, and indeed to avoid peoples scammed by good maths.

Well it is "coinmarketcap" after all. I think what you are looking for is closer to http://www.coinwarz.com

Yeah noticed this on Coinedup.

For example a coin selling at 1 and buying at 2, if you buy, the price will be 2 on Coinmarketcap, if you sell the price will be 1. It's easy to cheat the price by buying very small amount to get the higher price registered.
You can also make fake order (you buy or sell to yourself), that's increasing the traded volume. On coinedup, no trade fee, so it's free to cheat the system =)

edit: bolded something very important in your post.

They should change the formula.

I notices that even 0.1 btc pump trade on the single exchnage can bring certain coins up which is totlly not fair. I bet some guys manipulate that chart to advertize their coin to noobs (who just see crazy growth numbers and start buying bad pumped coins).

edit: damn sorry posted this in 'announcement' by mistake >_<

Hi, sorry about my english. I can fix the thread if someone correct it and send me a PM.

I'm feeling that CoinMarketCap and other ranking services are not ranking correctly the coins.

The ranks maths (on CMC) are:
COIN_AVAILABLE x COIN_AVERAGE_PRICE = MARKET_CAP = RANK
That's all. Only about market cap and nothing else.

It mean any premined coin, or any premined rare coin will be on in the firsts ranks easiest than any other coins.

Look at Aurora Coin, not saying it's a bad coin or so, but he should not be on the 3rd place.
He is on 3rd only because the maths to get the rank are calculating the premined coins, and because the low supplies allow it to go high in the ranks.

How many developers will understand the math trick and start to spec the coins just to be on the firsts ranks ? Not speaking about premine stuff, but good maths can throw your coin on a good position. Not mean the coin is good, only the maths.

I really think it's broken, and not showing the real ranks. The rank is based on a 'fictive' market cap.

I'll not complaint with no solution/idea.

I think the trade activity should be a factor in the formula.
With the actual ranking system, even a not active coin can have a good position and overtake the most actives.

An other example: how Counterparty is above Vertcoin ?
http://www.cryptocoincharts.info/v2/coins/show/vtc
http://www.cryptocoincharts.info/v2/coins/show/xcp

VTC have 2/3x more daily traded volume. The coin is traded as hell but low in ranks.

Think about all the new comers into cryptocurrency, they will watch the ranks to find the famous coins, naturally they'll watch the firsts coins and probably miss the most actives ones, the bests ones.
Even some peoples may think/troll that Litecoin is dying because some new coins going upper... it's bad because litecoin is dealing with bitcoin in term of traded volume...

http://www.cryptocoincharts.info/v2/coins/info
Here for the daily volume. Litecoin should be the 2nd on the ranking system. But he is not because the maths only looking ONLY the market cap.

My idea about a new forumla is to make activity as a factor.

For example (fictive numbers):
Bitcoin have a 200k daily traded volume
Litecoin 150k
Peercoin 2000
Dogecoin 3000
Nextcoin 250
Zetacoin 20
Auroracoin 5000

We take all volume:
200000+150000+2000+3000+250+20+5000 = 360270

To get the activity factor:
Bitcoin factor = 200000 / 360270 = 0.555139201
Litecoin = 150000 / 360270 = 0.416354401
Peercoin = 2000 / 360270 = 0.005551392
Dogecoin = 3000 / 360270 = 0.008327088
Nextcoin = 250 / 360270 = 0.000693924
Zetacoin = 20 / 360270 = 0.000055514
Auroracoin = 5000 / 360270 = 0.01387848

New rank maths:

COIN_AVAILABLE x COIN_AVERAGE_PRICE x COIN_ACTIVITY_FACTOR = RANK

New ranks (rounding numbers)
Bitcoin = 700 * 12500000 * 0.555139201 = 4857468008.75
Litecoin = 16 * 26000000 * 0.416354401 = 173203430.816
Peercoin = 3.5 * 21000000 * 0.005551392 = 408027.312
Dogecoin = 0.0011 * 56500000000 * 0.008327088 = 517528.5192
Nextcoin = 0.05 * 1000000000 * 0.000693924 = 34696.2
Zetacoin = 0.0085 * 160000000 * 0.000055514 = 75.49904
Auroracoin = 90 * 10600000 * 0.01387848 = 13240069.92

1. Bitcoin
2. Litecoin
3. Auroracoin
4. Dogecoin
5. Peercoin
6. Nextcoin
7. Zetacoin

So with this new formula the ranks are more fair, based on market cap + actual trading.
The day Auroracoin will be less traded, he will leave the firsts ranks.
With the actual ranking system, even if auroracoin being not traded at all, he will stay on the firsts positions.

I'm not blaming Auroracoin, but this coin opened my eyes on how the coins are ranked.