Why Is There A Difference In Ranking Of ADA On Coinmarketcap And Coingecko!
Cardano Foundation's ADA is gaining more popularity in the crypto world ever since the announcement was made regarding the release of Shelley later this month. ADA has been picking up steam since then and it has already doubled in value from the day of the announcement. It was briefly trading at 13.3 cents before correcting and at the time of writing this, ADA is trading at 11.8 cents.
Source
Coinbase, a popular cryptocurrency exchange, announced that it was interested in listing ADA, two years ago but since there was a huge delay in the release of much-awaited Shelley, Coinbase kept ignoring it. But now, there is no reason for Coinbase, not to list ADA. Charles Hoskinson announced that Coinbase listing is possible before the end of this year and if ADA gets listed on Coinbase, ADA might touch 40 cents by the end of this year.
Now let's jump into our main topic
I don't know if you follow coinmarketcap and coingecko rankings, but I have been following these two websites for more than 3 years now. I have always noted differences in ranking of different crypto projects. But seeing a top 10 crypto ranked number 6 on coingecko and number 7 on coinmarketcap got me thinking about the possible reason. I know, coinmaketcap lists crypto projects that aren't on 3 big centralized exchanges on page 3 but this was is totally different.
I did some research about the possible reason and I came across a few posts that have addressed this issue. I also asked a few people involved in Cardano and I got my answers. The reason is that Cardano Foundation, IOHK, and Emurgo were allocated some ADA at the start of the project. These three companies are involved in ADA development and have received over 5 billion ADA which have a value of over $600 million at the current price.
The ranking of ADA depends on the calculation of circulating supply. Coinmarketcap does not calculate those 5 billion ADA allocated to three companies but Coingecko does and that's what causes the difference in ranking of ADA.
Now the main question that arises is that "Should we calculate the company tokens as well"? This depends on whether or not the tokens have been spent or not and was there any lock-up period for those tokens. I still don't have answers to those questions.
If you have the answers to these questions, let me know.
Disclaimer
This is not financial advice. These are my personal thoughts and opinions
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greetings friend in the personal I follow coinmarketcap during more than 3 years an excellent reference, since for the calculation normally are included the circulating currencies and its market I imagine that those stored tokens are not taken out of the market because they would cause prices to fall...
It doesn't work like that. Cardano would never unlock company tokens in a single go. They might have been released slowly over a period of time.
Coingecko is usually more accurate in many terms than coinmarketcap. But both are great, it's best to take a look at both of them sometimes
That's what I think as well.
Got to make use of both of them for accuracy.
Good post, helped me to understand better about the subject.
Well done, @syedumair.