Investigating EOS' Market Cap Performance

Coming off a great year that saw EOS go from 52nd position on CoinMarketCap to 38th a year later, things have started to show a reversal trend for the EOS token. Well, it’s more of a slowdown than a reversal. Put even more accurately - EOS is being outperformed by other cryptocurrency projects in these first weeks of the new year.

Should things proceed the way that they are then EOS could quickly lose ground gained over the last year in market cap rankings, and possibly give up even more ground to competitors. If this were to happen EOS would risk being forgotten in the market as it slips further away from public view. A harsh outcome, it would be, for a project that was once considered an “Ethereum Killer”.

Why the sudden drop in market cap rankings?

Looking at how the previous year began and comparing it with the start of this year; one thing seems to have changed. This year there seems to be a shift in market cycles from the previous year. At the beginning of the year in January 2022, the cryptocurrency market was coming off a great bullish cycle and had just entered a bearish one. Many cryptocurrencies were losing value fast, with many market participants facing threats of liquidation.

In the beginning of this year, however, market conditions are different. Many of the market participants that were faced with liquidations have been liquidated and the cryptocurrency market seems to be taking a bullish turn once more.

For instance, in the last 2-3 weeks (8 January - 26 January) Bitcoin has gone from $17,091 to $23,667, a 38% increase, to mark its 4-month all-time high. Many other cryptocurrencies, including EOS, have witnessed similar but varying uptrends during the same period.

In the case of EOS, it has gone from $0.90 to $1.09, a 21% increase within the same time span. The problem, if I dare call it that, is that EOS’ market cap gains are being outperformed by other cryptocurrency projects on the market. As a result, this year has seen the EOS token go from 39th position on January 8, to its current position of 45th by market cap on January 26.

Every time the cryptocurrency market is on an uptrend the EOS token loses ground on market cap rankings, and every time there is a market downfall EOS gains ground on competitors.

So then if EOS is going to be bullish in one market cycle then sluggish in another, that shouldn’t be a problem right? That should theoretically balance things out. Just as many assets are bearish during bear markets and bullish during bull markets.

Bullish during a bear market, but sluggish in the bull market.

The thing is bear markets and bull markets are not equal forces of opposing sides. If that were true, then markets wouldn’t reach new all-time highs time and again. In fact, looking at markets, whether it be commodities, housing, stocks, or crypto markets, it is safe to say that a bull market has more pull than a bear market as prices tend to keep going up over time rather than drop. Bear markets then could best be described as short pauses or breathers from the constant state of ever rising market prices.

If that is true and EOS only performs best during bear markets, then the cryptocurrency is headed for an ‘inevitable’ fall out of the top 100 rankings by market cap. Bear markets don’t have the same pull as bull markets have because, oftentimes, prices rarely go back to lows of the previous cycle. And as stated earlier; a drop in market cap rankings means EOS becomes less visible to investors, and pretty much would go dark should it fall outside the top 100.

When was the last time you scrolled through the second page of a crypto ranking site or Google?

That is why it is vital that EOS finds a way to outperform competitors, both during a bear market and during a bull market. That is what it takes to be a leading cryptocurrency on the market - Bitcoin and Ethereum (market leaders) held up better than most during the bear market and are now outperforming most projects during this seemingly bullish cycle.

Luckily for EOS it’s already doing well under one market condition. It now only needs to improve under the opposing market condition. Compared to previous years which saw EOS go from a top 5 cryptocurrency to outside the top 50, performing well under a bear market is a huge step towards a spot back at the top.

Favorable outcomes will require concentrated efforts

Efforts need to be made to ensure that EOS keeps rising up the rankings during either of the market cycles if it is determined to ever make it back to the top. The answer to that lies in the problem itself. Problem: EOS is slipping further away from public view. Solution: EOS needs to improve visibility to the public.

Actions to take are then determined by the required outcomes. The best place to be in for visibility is to be in the top 10 rankings, and ideally the top 5. This is where everybody who enters the cryptocurrency market looks to invest. It’s also where the vast majority of market participants, who aren’t yet invested in your project, get familiarity with its branding (name and logo).

EOS stakeholders have done a lot this past year to bring back life into the project and to change the trajectory of its network towards a more successful path. However the one thing that has always lacked in EOS, that still evades it now, could be more useful now than ever before.

Will 2023 be the year that EOS marketing efforts finally take shape?

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