XRP Is The Most Overhyped And “Manipulated” Among The Top Cryptocurrencies: Study
- Just like trading volume manipulation, coins are manipulated on Twitter by bot accounts and fake followers
- Despite efforts to improve cryptos legitimacy, crypto space remains very much the wild west
According to the Hype-to-Activity Ratio metric created by The TIE, the data, analytics, and financial management tools provider, across the board, the largest cryptocurrencies by market capitalization have relatively consistent ratios with the exception of XRP.
The third largest cryptocurrency has a “significantly” higher Hype-to-Activity ratios at over 4 than other coins who have below 2.
On further including the hashtags, #XRPCommunity, #XRPTheStandard, and #XRPArmy, which more than 33% of all XRP tweets use, the ratio spikes to 6.66.
However, it is still “tiny” compared to some other cryptos.
The red line in the chart shows the average of 1.02 tweets per $1 million in trading volume.
All this hype without activity means,
“Just like trading volume manipulation, many of these coins are similarly being manipulated on Twitter by hoards of bot accounts, fake followers, and manipulated engagement.”
Crypto Industry Remains Very Much The Wild West
As for the least hyped digital asset across the 450 cryptocurrencies investigated, Tether, EOS, Ethereum Classic, Cosmos, and NEO are the ones with tweets averaged less than 25 per day.
In case of Electroneum, the most recent tweets came from “accounts with strings of arbitrary numbers in their handle,” which is typically a sign of fake accounts.
Telcoin, DigiByte, and IOTA are similarly overhyped.
Cryptocurrencies with artificially high levels of conversations are also the ones with high numbers of Twitter followers, as an effort to establish legitimacy.
However, it doesn’t just manifest itself on Twitter. For instance, Justin Sun has 6 million likes on Facebook, shares the firm while the largest crypto exchange Coinbase that has over 30 million users got only 187k likes.
“While significant efforts are being made to improve cryptos legitimacy, the industry remains very much the wild west.”