With the goal of creating a better way to research, trade, and manage cryptocurrency, CoinLion has developed The CoinLion Crypto Classification System and Coin Reports. Using this classification system each cryptocurrency can be assigned a 4 character alphanumeric code. This code can be used to quickly identify important characteristics of a cryptocurrency.
The classification system is designed to be simple yet effective and also give researchers a way to quickly and easily make intelligent comparisons between various cryptocurrencies.
In our research we have found emerging cryptocurrencies to have characteristics that can be used to categorize them based on method of creation, functionality, size, and supply control.
Classification Graphic & Key
- C - Coin
- T - Token
- 1 - Payment
- 2 - Platform
- 3 - Asset Backed
- 4 - Privacy
- 5 - Protocol
- 6 - Utility
- G - Mega-Cap
- L - Large-Cap
- M - Mid-Cap
- S - Small-Cap
- C - Micro-Cap
- 7 - Fixed
- 8 - Deflationary
- 9 - Inflationary
Coins: A coin is a cryptocurrency that operates independently and typically on its own blockchain.
Tokens: A Token is a cryptocurrency that depends on another platform to operate. Example: Ethereum Tokens (ERC-20), NEO (NEP-5)
Payment: Used as a payment method or value store.
Protocol: Designed to host decentralized applications and/or create/issue tokens.
Platform: Specific to one entity or application.
Asset Backed: Backed by a asset such as fiat currency (USD), gold or precious metal, equity or some other physical asset.
Privacy: Designed with the purpose of creating private transactions.
Utility: Designed to serve a purpose or provide access to benefits or features within an application or network.
Understand that while certain coins and tokens may fall into multiple categories we apply the category that is the best fit at the time of classification. Classifications may change if the primary function of the coin or token changes.
Market Cap is used to classify the cryptocurrency by its respective market cap.
At this time we will be using CoinMarketCap.Com to define the market cap.
This calculation is: market cap = circulating supply * price.
Cryptocurrencies often fluctuate rapidly causing markets caps to move significantly in short periods of time. In addition, smaller or immature cryptocurrencies may increase in market cap over time, and may move from one market cap to another. For the purpose of this classification system we assume that cryptocurrencies can move from one group to another as their market caps changes. We apply the market cap that is the best fit at the time of classification.
- Mega-Cap ≥ $10 Billion
- Large-Cap - $1 Billion to $10 Billion
- Mid-Cap - $100 Million to $1 Billion
- Small-Cap - $10 Million - $100 Million
- Micro-Cap - ≤ $10 Million
Supply is broken into three groups. While certain coins may end up fitting into multiple groups depending on their evolution and lifecycle, for the purpose of this classification system we assign the supply classification based on best fit at the time of the assignment.
Fixed: When a cryptocurrency has a fixed total supply. There will only ever be a set amount of coins. Example Bitcoin maximum supply is 21 Million.
Deflationary: When the supply will be reduced over time. Decreasing supply is typically associated with burning or destroying coins or tokens.
Inflationary: Increasing supply over time. Typically associated with mining.
Sample Classification Bitcoin: C1G7
- C = Coin — Bitcoin operates on its own blockchain.
- 1 = Payment — Bitcoin is typically thought of as a means of payment or value store.
- G = Mega-Cap — Bitcoin has a market cap of over $10 Billion.
- 7 = Bitcoin has a fixed supply at 21,000,000
In order to quickly and easily visualize two critical features of a cryptocurrency we have created a custom style-box specific for cryptocurrencies.
Styles can be:
While we have defined other market caps such as micro and mega caps, for the purpose of a simple visualization, we will place cryptocurrencies according to their best fit at the time of classification.
Sample style box classification for Bitcoin.
Part of CoinLion’s mission is to provide resources for cryptocurrency traders and researchers. The CoinLion Classification System creates a standard reporting system that can be used to make intelligent comparisons quickly and easily. CoinLion plans to improve and refine this system as the crypto ecosystem matures.
These reports will be available to LION Holders in the CoinLion research portal as well as be accessible within the CoinLion Trading Platform. CoinLion plans to utilize this system within the trading platform and the research portal as the platform matures.