Quote from: TPTB_need_war on April 05, 2016, 07:35:03 PM

Quote from: TPTB_need_war on April 05, 2016, 05:30:52 AM

I thus suggest an idea for a new metric for ranking altcoins.

Sqrt(M x H)

M = Mean transactions fees paid per unit time to decentralized proof-of-work miners
H = hash rate (normalized in electricity cost per hash to SHA256).

Using M = Sent avg. per hour, H = Hashrate (normalized):

1.Bitcoin	6.5×10¹²
2.Namecoin	8.6x10¹⁰
3.Ethereum	6.6x10¹⁰
4.Litecoin	1.3x10¹⁰
5.Dash	9.8x10⁹
6.Blackcoin	7.4x10⁸
7.Dogecoin	6.1x10⁸
8.Auroracoin	5.8x10⁶

One of the reasons that Bitcoin is 100X higher than the altcoins is because its "Sent avg. per hour" is so much higher than its Volume(24h)/24, which indicates that Bitcoin has a much higher level of transactions that aren't occurring on known exchanges that report volume. In other words, Bitcoin has more real adoption for use cases other than speculative trading, which is one of the attributes I wanted to capture with my proposed metric. What this seems to indicate is that altcoins are nothing compared to Bitcoin, which is what I expected but a 100X greater wow.

Unfortunately I couldn't find the "Sent avg. per hour" data for the others altcoins.

Note I am using transaction value as a proxy for transaction fees paid, which isn't entirely accurate. I believe for example that Monero has higher transactions fees to mitigate spam which could be used to reduce anonymity sets.

It isn't accurate at all because with very low fees you can definitely have spam but you can also have transactions that are spewed as manipulation to make the coin seem used. (Even high fees would be irrelevant if the insiders also control the mining, but this wouldn't generally correlate with a high hash rate.) Bytecoin is a good example of this. It has tiny fees and junk transactions generated by some automated process 24x7.

But then, a lot of exchange volume (especially in China) is also documented to be fake, so it very hard to make these comparisons meaningful.

On this in particular:

Quote

In other words, Bitcoin has more real adoption for use cases other than speculative trading

Certainly true, but as far as magnitude, the data must be interpreted with caution. A huge portion of Bitcoin blockchain transactions are tied (by various published blockchain analysis) in some way to mining or trading (moving coins between exchanges for example). Mining is larger in size (and therefore mining-related txs are also larger in aggregate) simply because Bitcoin has higher value, so you are measuring a proxy for market cap in some ways here. Bitcoin also has various spam attacks over the past year or so that seem to be a outgrowth of the blocksize politics.

Anyway, interesting chart here, but as always inputs are not so trustworthy. https://blockchain.info/charts/tx-trade-ratio