Murad releases table of meme coin metrics to evaluate decentralization

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As a seasoned analyst with over two decades of experience in the cryptocurrency market, I find Murad Mahmudov’s approach to be both innovative and essential for any investor seeking to navigate the treacherous waters of meme coins. His table of nine metrics, each designed to measure decentralization from a different angle, provides an unparalleled perspective on the level of risk associated with these viral tokens.

Meme coin expert Murad Mahmudov has shared a data chart containing nine indicators, which are intended to gauge the degree of decentralization within meme-based cryptocurrencies.

In a recent post on X, Murad revealed what he considers to be his most significant collection of statistics for meme coins – a table that highlights nine key indicators designed to assess the degree of decentralization among the top meme coins currently available in the market.

In his post, Murad stated, “I’m examining the decentralization of popular meme coins from nine various perspectives. The blockchain’s data is trustworthy.

This is the MOST IMPORTANT Memecoin Statistics Table I have ever compiled.

Don’t Trust any ONE metric? How about NINE?

Measuring DECENTRALIZATION of Top Memecoins from NINE different angles.

The Blockchain Doesn’t Lie.

— Murad 💹🧲 (@MustStopMurad) November 28, 2024

meme-based cryptocurrencies have exploded in popularity, spreading like wildfire across the digital currency landscape. Coins such as GOAT (Greatest of All Time), POPCAT (Popular Cat), and MOODENG (Mood Energy) are among those that have gained significant value, with market caps ranging from millions to billions. This surge in interest has drawn investors of all experience levels, including veteran traders and newcomers alike.

In the world of meme coins, it’s not uncommon for tokens to experience rapid increases in value, only to dramatically drop shortly after. This phenomenon is known as a “rug pull”. When this happens, investors who have put money into the token can lose everything when a major shareholder abruptly sells their entire position, causing the token’s value to plummet.

Murad aims to disprove the crypto community’s skepticism towards meme coins, which are often seen as high-risk investments with significant potential losses. By examining the degree of decentralization in a meme coin, he suggests that it becomes less likely for investors to experience a ‘rug pull’ by powerful holders looking to drain the token of its value. A more decentralized token means there are fewer opportunities for dominant holders to manipulate and exploit the market.

What are Murad’s meme coin metrics?

Murad’s table showcases nine different indicators he utilizes for assessing the level of decentralization. The initial indicator is referred to as Median Holder Rank, which represents the position of the median wallet holding the token. A lower rank in this context suggests a more even distribution among the holders, implying improved decentralization.

Moving forward, we have the Herfindahl-Hirschman Index that gauges the level of ownership concentration on a scale ranging from 0 to 10,000. A smaller number in this context means greater decentralization, whereas a value of 10,000 signifies complete centralization.

The third measurement is called HolderScan Distribution Score, it assesses the quality of token distribution among users. A higher score signifies a more decentralized system. The fourth, fifth, and sixth measurements focus on the proportion of tokens owned by the top 100, 25, and 10 biggest token holders, respectively.

The seventh and eighth statistics demonstrate the proportion of digital wallets containing over $1,000 worth of the token, represented as both a percentage and a ratio. Lastly, the ninth metric gauges the percentage of newly created wallets during the first week following a token’s launch. A lower percentage suggests a more robust decentralization.

How do you apply the metrics to meme coins?

According to Murad’s evaluation system, these metrics can help determine if a meme coin is suitable for investment due to its level of decentralization. Coins that have smaller HHI values, less concentrated ownership, and a greater number of large-scale investors (those with over $1,000 worth) are typically more decentralized.

As a researcher, I’ve observed that higher HHI values, substantial concentration among leading wallet holders, and intense first-week wallet activity might indicate a centralized system where a handful of wallets exert significant influence or control.

To give you a simpler version: The meme coin that’s often thought of as Murad’s favorite, known as SPX6900 (SPX), stands out with a median holder rank of 181, an HHI of 29, and a significant 16.8% controlled by top investors. Regarding decentralization, SPX6900 takes the lead position.

Currently, MOODENG finds itself at the bottom of the table due to its median holder rank being 19th highest, an HHI (Herfindahl-Hirschman Index) of 303, and a top holder concentration of 33.5%. These figures suggest that MOODENG has a more centralized structure, as per the metrics provided by Murad.

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2024-11-29 18:16