Connect with us

Chart of the Week

The Unparalleled Explosion in Cryptocurrencies

Published

on

The Unparalleled Explosion in Cryptocurrencies

The Unparalleled Explosion in Cryptocurrencies

Over 300 new coins reached $1mm market cap in 2017

The Chart of the Week is a weekly Visual Capitalist feature on Fridays.

After the massive Bitcoin price surge in November 2013, the popularity of launching new cryptocurrencies took off along with it.

In fact, if you go back at historical snapshots around that time, you’ll see that there were literally hundreds of new coins available to mine and buy. Here’s one from November 2014 – a time when there were only 32 coins that were worth more than $1 million in market cap, and 354 coins that were worth less than $50,000, usually trading for tiny fractions of a cent.

It seems like everyone and their dog were launching cryptocurrencies back then, even if they were a longshot to materialize into anything.

Then vs. Now

Fast forward to today, and things haven’t changed much – many people and companies are still launching new cryptocurrencies through a mechanism known as an ICO (Initial Coin Offering).

Cryptocurrency ICO activity
The only difference?

Today, there is real money at play, and in 12 months the number of cryptocurrencies worth >$1 million has soared by 468%. Meanwhile, the total value of all currencies together has skyrocketed by 1,466%.

Cryptocurrency is so hot, in fact, that raising money through ICOs has become more effective than traditional early-stage angel and VC funding.

Funds raised by ICOs vs. early-stage VCs

For the long-time advocates of Bitcoin and other cryptocurrencies, it is now their moment in the sun.

And with this ICO activity and a wealth of opportunities emerging, a new breed of Bitcoin millionaire has been born. Like the wealthy tech founders that exit and give back to their local startup ecosystems, these new digital tycoons are using their newfound wealth to invest in upstart crypto projects that show potential – ultimately, further enhancing the ecosystem.

Out of the Woodwork

Of course, whenever there is a massive surge in prices and speculation, there are two other players that tend to come out of the woodwork.

One is of the scammer and shyster variety, and certainly crypto-fueled scams are a concern for everyone else in the broader ecosystem.

Perhaps even a bigger threat, however, are the regulators – and in recent weeks the SEC has voiced concerns about ICO “pump and dump” schemes, while Canadian authorities have clearly stated that “most ICOs need oversight”.

Cryptocurrency ICO activity

With the market exploding with hundreds of new cryptocurrencies and the total value reaching $177 billion, a new series of questions has emerged: what risk do ICO scams ultimately have on market? And, could misguided regulation disrupt the momentum of the crypto boom?

Subscribe to Visual Capitalist

Thank you!
Given email address is already subscribed, thank you!
Please provide a valid email address.
Please complete the CAPTCHA.
Oops. Something went wrong. Please try again later.

Continue Reading
Comments

Chart of the Week

War and Peace: How Violence is Disrupting the Global Economy

This graphic estimates the direct and indirect costs associated with violence, and explores how they are negatively impacting the global economy.

Published

on

War and Peace: How Violence is Disrupting the Global Economy

Although you may not see it, millions of lives are disrupted by violence everyday.

War, homicide, terrorism, suicide, and sexual assault can be found across the world in various degrees. While certain types of violence can incur costs that result in personal traumas, violence can also create significant economic disruptions.

In today’s Chart of the Week, we visualize data estimates from the Global Peace Index 2019 on the global cost of violence, and its geographical spread.

How is Violence Linked to the Economy?

The Global Peace Index calculates the total cost of violence using purchasing power parity (PPP) by considering three factors:

  • Direct costs: Immediate consequences to the victims, perpetrators and the government
  • Indirect costs: Delayed economic losses following the violent event, including the after-effects of trauma experienced by the victim
  • Multiplier effect: Calculates the additional economic activity that would have accrued if the direct costs of violence had been avoided.

Between 2012-2017, the cost of violence increased by 11% to $14.6 trillion—mainly due to rising violence in Syria, Libya, Yemen, and other parts of the Middle East and North Africa.

In 2018, the total cost of violence decreased for the first time in six years to $14.1 trillion. That’s the equivalent of 11.2% of global GDP (PPP), or $1,853 for every person.

In this one year, the $475 billion saved from decreased violence costs was largely due to lower levels of armed conflict in Syria, Ukraine, and Colombia.

The Top 10 Worst Affected Countries

It comes as no surprise that countries affected by conflict incur the greatest costs due to a higher than average death toll, and sizable military expenditures.

Here are the countries with the highest cost of violence according to the report:

RankCountryCost of violence (% of GDP)    
#1🇸🇾 Syria67%
#2🇦🇫 Afghanistan47%
#3🇨🇫 Central African Republic42%
#4🇰🇵 North Korea34%
#5🇮🇶 Iraq32%
#6🇻🇪 Venezuela30%
#7🇨🇾 Cyprus30%
#8🇸🇴 Somalia26%
#9🇨🇴 Colombia25%
#10🇸🇻 El Salvador22%

Since 2017, Venezuela has climbed the ranking and now sits in the top 10, due to continuing political repression and a spiraling economy as a result of hyperinflation.

The Global Composition of Violence

Government spending on military comprises 40% of the global total, or $5.7 trillion in constant purchasing power parity (PPP).

Type of economic impactShare of total     
Military expenditure
40.2%
Internal security expenditure
31.7%
Homicide
8.6%
Private security expenditure5.8%
Suicide5.2%
Armed conflict4.8%
Violent crime2.6%
Other1%

Naturally, the types of violence costs vary by region, and the most noticeable difference is in military expenditure. It represents 59% of Middle East and North Africa’s violence costs—but only 8% for Central America and the Caribbean.

regional costs violence

Interestingly, the Middle East and North Africa boast the lowest levels of violent crime, homicide, and suicide, representing only 4% of the total, compared to South America’s 45%.

Keeping the Peace

Despite today’s chart painting a picture of the world as a dangerous place, it is worth noting that there are two sides to this story.

Of the 163 countries ranked in the index, 86 countries improved their peace score in the last year, with Iceland retaining its number one position for over a decade. In fact, the country has not had any gun murders since the Global Peace Index began in 2007.

Is the recent drop in costs of violence a sign that we are moving towards a more peaceful planet, or just a blip on the radar?

Subscribe to Visual Capitalist

Thank you!
Given email address is already subscribed, thank you!
Please provide a valid email address.
Please complete the CAPTCHA.
Oops. Something went wrong. Please try again later.

Continue Reading

Business

Ranked: The 20 Easiest Countries for Doing Business

Entrepreneurship is challenging at the best of times. Here are the countries where at least starting a new business is easy to do.

Published

on

Easiest Countries to do Business

Ranked: The 20 Easiest Countries for Doing Business

Contrary to popular belief, the hardest part about running a business may not be finding customers, it’s getting one started.

Depending on the public policies and application processes of your country, you might struggle or succeed in opening and operating a business.

If you live in New Zealand, for example, you can get a new enterprise up and running in half a day. If you live in Luxembourg or Argentina, however, it’s a different story─with the process sometimes taking over a year.

Today’s chart uses data from the World Bank’s annual Doing Business 2020 report, which delves into the ease of doing business in countries around the world.

Measuring the Ease of Doing Business

Now in its 17th year, the Doing Business (DB) report measures how easy it is for someone to start and run a company in an economy, using 12 key factors throughout a business lifecycle:

  1. Starting a business
  2. Employing workers
  3. Dealing with construction permits
  4. Getting electricity
  5. Registering property
  6. Getting credit
  7. Protecting minority investors
  8. Paying taxes
  9. Trading across borders
  10. Contracting with the government
  11. Enforcing contracts
  12. Resolving insolvency

Of the 190 countries reviewed last year, only 115 made it easier for entrepreneurs to do business.

Note to readers: this year’s DB score did not factor in Employing Workers or Contracting with the Government when ranking economies.

Top 20 Easiest Countries to Run a Business

RankCountryDB Score
#1🇳🇿 New Zealand86.8
#2🇸🇬 Singapore86.2
#3🇭🇰 Hong Kong85.3
#4🇩🇰 Denmark85.3
#5🇰🇷 South Korea84
#6🇺🇸 United States84
#7🇬🇪 Georgia83.7
#8🇬🇧 United Kingdom83.5
#9🇳🇴 Norway82.6
#10🇸🇪 Sweden82
#11🇱🇹 Lithuania81.6
#12🇲🇾 Malaysia81.5
#13🇲🇺 Mauritius81.5
#14🇦🇺 Australia81.2
#15🇹🇼 Taiwan80.9
#16🇦🇪 United Arab Emirates80.9
#17🇲🇰 North Macedonia80.7
#18🇪🇪 Estonia80.6
#19🇱🇻 Latvia80.3
#20🇫🇮 Finland80.2

In the top spot for the fourth year in a row, New Zealand only requires half a day to start a business. Singapore also stands out for having the shortest timeframe when it comes to paying business taxes and enforcing business contracts.

Only two African nations─Rwanda and Mauritius─are listed in the top 50 countries, with Mauritius being the only one to crack the top 20 list.

Latin American economies are noticeably missing from the rankings, as many countries in this region are fraught with bureaucracy and prolonged processes.

Most Improved Scores

Several developed and developing economies made significant strides in 2019 to implement reforms that opened doors for new business owners.

The Doing Business 2020 report shows that the cost of starting a business has fallen over time, particularly in developing economies.

Top 10 Most Improved Economies, 2018-2019

Top 10 most improved economies for doing business

Saudi Arabia made the greatest improvement overall, adding 7.7 points to its score.

Bahrain also made improvements over the most number of factors (9). While Jordan showed improvement in the fewest factors (3), it showed the second highest jump in DB Score.

Gains Among Low-Income Countries

The DB 2020 study also shows that developing economies are making progress: it’s now cheaper than ever before to run a business in developing economies.

However, a significant disparity still remains when we consider the difference in business costs between high-income and low-income economies.

An entrepreneur starting a company in a low-income economy will spend about 50% of per capita income (PCI) to launch a venture, whereas an entrepreneur in a high-income economy spends only 4% PCI to accomplish the same task.

Put another way, entrepreneurs located in the bottom 50 economies spend an average six times more to open a new company as those in a high-income economy.

Entrepreneurship and Economic Growth

Generally, more entrepreneurs will enter a market where they can easily conduct business─adding more value to local economies.

While the rankings clearly illustrate the link between ease of doing business and economic growth, there are still significant barriers in place that not only deter entrepreneurship but also inhibit a relatively simple strategy for growth.

Subscribe to Visual Capitalist

Thank you!
Given email address is already subscribed, thank you!
Please provide a valid email address.
Please complete the CAPTCHA.
Oops. Something went wrong. Please try again later.

Continue Reading
Novagold Company Spotlight

Subscribe

Join the 130,000+ subscribers who receive our daily email

Thank you!
Given email address is already subscribed, thank you!
Please provide a valid email address.
Please complete the CAPTCHA.
Oops. Something went wrong. Please try again later.

Popular