Bull tail junk coins are rampant? 64% of respondents think it is very similar to 2017

Wu said the author | Uncle Tan

Editor of this issue | Colin Wu

This year, cryptocurrencies have ushered in a bull market. The price of Bitcoin has doubled compared to the beginning of the year, and has increased nearly tenfold compared to the same period last year. Other cryptocurrencies have also performed well. In addition, emerging projects represented by various zoos and MEME coins have recently refreshed people's cognition with their growth, which reminds people of the bull market of cryptocurrencies in 2017. Interestingly, a project called "Dark Dogecoin" also appeared in 2017, claiming to have increased 10,416 times in one year.

In a survey conducted by Wu Blockchain on Weibo, 2,667 people participated, 64% thought it was similar to 2017-18, only 14% thought it was different, and the others entered the circle after 2017 and did not experience 2017-18. At the end of 2017 and the beginning of 2018, the bull market reached its peak and then began to fall. We believe that the current situation has shown similarities with the end of the last bull market in the following aspects:

Bitcoin Mining Fees

According to data from The Block(1), during the last bull market, the average mining fee of the Bitcoin network reached its peak on December 27, 2017, with each transfer requiring a mining fee of up to US$47.75. This record was broken on April 23 this year, when the average mining fee of the Bitcoin network reached US$53.17 (due to a certain accidental factor due to a power outage in the northwest due to a safety inspection).

Due to the limitation of Bitcoin block size, the surge in miner fees indicates the users’ enthusiasm for on-chain transfers and also shows the madness of users in the bull market, because most of them have already made a lot of profits and therefore do not care about the high transfer fees.

Similar things also happened on the Ethereum network. During the last bull market, Ethereum's miner fees reached a historical high of US$3 per transaction on January 14, 2018. This time, with the popularity of Defi, on February 25, the average miner fee of the Ethereum network reached US$24.7, a much higher growth rate than the Bitcoin network.

Altcoins steal Bitcoin's limelight

After the bull market began, users tended to speculate on altcoins with greater gains. During this process, the prices of some previously languishing altcoins began to soar. Interestingly, in December 2017, the price of a coin called “Dark Dogecoin” (XVG) [soared by 800%] within a week (2). Other early altcoins such as DASH also performed well, and some emerging projects such as Cardano and IOTA also shined. In this bull market, in addition to the early altcoins doge, etc., which performed well, some emerging projects such as Polkadot entered the top ten in terms of market value, and BNB even entered the top three in terms of market value.

The result of the excellent performance of altcoins is that the market value of BTC is being eroded step by step. In the last bull market, Bitcoin's share of the market value of cryptocurrencies fell to a historical low of 37.64% on January 1, 2018, and then a bear market began. Currently, Bitcoin's share of the market value of cryptocurrencies is also declining step by step, currently at 45.16%. It can be predicted that after popular projects such as dfinity are listed, Bitcoin's share of the market value will further decline. (Data source [tradingview](3))

Junk projects lead to bull-bear transitions

In the early stage of the bull market, newly issued coins are often packaged, but in the later stage, coin issuers are often too lazy to package and just issue coins for the sake of issuing coins. Investing in all kinds of incredible junk projects can often bring greater returns, making research and analysis meaningless, and as time goes by, more and more ridiculous coin names appear. For example, in the last bull market in 2017, the twelve zodiac coins and even MLGB coins appeared one after another. In this bull market, it started with Musk's call for Dogecoin, and then SHIB was released and quickly entered the top 20 in market value. A series of other animal coins at home and abroad were released, and their values ​​also rose hundreds of times in a short period of time.

Of course, the massive entry of institutions, Defi, NFT, etc. are all positive features that were not seen in the last bull market. It is still too early to say that the bull market has bottomed out. However, the crazy phenomena happening in the cryptocurrency world today inevitably remind people of the last bull market.