Ethereum is the most correlated with the rest of the crypto market in 2019

Binance’s recent research shows that Ethereum is the most correlated type with the rest of the cryptocurrency market in 2019.

Ethereum correlates most with other cryptocurrencies

Binance’s research department published a report on January 22, showing that during 2019, ETH had an average correlation coefficient of 0.69. The report compares the correlation data of the top 20 cryptocurrencies.

“ETH is the most correlated asset. With an average correlation coefficient of 0.69 throughout 2019, it is always among the most correlated assets.
The coefficient starts at 0.69 in Q1 and increases to 0.72 in Q4 (Q2: 0.65; Q3: 0.74) “, Binance wrote.

Ether is much less correlated in the first half of 2019 and most correlated in the second half. Interestingly, the research pointed out that blockchains are programmable online, like Ethereum, NEO and EOS often show a higher correlation with each other than non-programmable assets.

Other crypto assets that are highly correlated with the rest of the market include Cardano, EOS, Litecoin, XRP, and Binance Coin. Furthermore, the researchers observed that the correlation was often higher between the highest market capitalized cryptocurrencies.

Ethereum crypto 2

Source: Binance Research

On the other hand, the assets that have the lowest correlation with the rest of the market are Cosmos (0.31), followed by Chainlink (0.32) and Tezos (0.4).
Overall, the average correlation between major cryptocurrencies slightly decreased in Q4 2019.

Another interesting phenomenon pointed out by the researchers is the “Binance effect”. Cryptocurrencies listed on Binance show a higher correlation than non-listed assets.

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