NEWS
TokenInsight Rating Quarterly Review 2023 Jan
“It’s been 3 months since TokenInsight Rating v2 went live in November. Let’s take a look at what has changed in these 3 months and what trends can be seen through the rating results.”
TokenInsight Ratings Overview: A Total of 292 Projects Rated
TokenInsight, the leading blockchain ratings agency, has rated a total of 292 projects as of February 6, 2023. The ratings are presented on a scale of AAA to D, with AAA being the highest rating of a project’s credentials and D indicating an extremely high-risk project.
Out of all the projects, the largest number of projects have been rated BB, accounting for 25% of the total rated projects. The rating results follow a normal distribution pattern, with fewer projects as the ratings improve or decline on either end of the scale.
TokenInsight’s Rating Score: A Dynamic Picture
Since November 1, 2022, when TokenInsight had completed ratings for 143 projects, about 15% of the projects have improved their rating scores. Optimism and GMX were among the most significant improvements. The rating score is an objective score used to determine the rating result and reflects changes in a project’s qualifications or risk.
On the other hand, 31% of the projects saw a decline in their rating scores, with the most severe declines being seen in FTX Token, Serum, and Solana, all of which are closely linked to the FTX bankruptcy. Cronos, Binance USD, and Huobi Token also saw their rating scores drop. The remaining 54% of the projects’ rating scores remain unchanged from three months ago.
Newly Rated Projects: Infrastructure, Public Chain, and Layer-1
Of the 149 newly rated projects, most of them included keywords such as Infrastructure, Public Chain, and Layer-1. The Ethereum, Optimism, and Cosmos ecosystems were the most frequently seen among these projects, while the once-popular BNB Chain, Polygon, and Solana were not seen at all. The projects are diverse, with DeFi still leading, followed by derivatives, liquid staking, social, storage, and others.
TokenInsight’s Top 10 Ratings
The Top 10 ratings have not seen much change, with FTX Token dropping out of the list and being replaced by Cosmos. The average score of Bitcoin and Ethereum quickly returned to pre-FTX bankruptcy levels, indicating a positive long-term outlook for the Crypto market.
The average score of DeFi tokens rose 3%, making it the only type to close with a higher score. Public chain and exchange tokens stabilized after declines of 6% and 12% respectively. The average score of stablecoins fell by more than 15% due to the USDD de-peg and Binance USD reserve scandal, as well as a net outflow for the past three months.
TokenInsight’s Rating Outlook: A Guide for the Future
TokenInsight describes the future trend of a project’s rating by its outlook. Projects with a positive outlook have the opportunity to upgrade their ratings in the next three to six months, while those with a negative outlook may be downgraded in the future. It’s important to note that the project ratings only evaluate a project’s qualifications and risk level and should not be used as investment advice.
Top-Rated Smart Contract Platforms
The total value locked (TVL) of all public chains was down by 10%, with Ethereum and BNB Chain in line with the overall decline. Solana was the hardest hit by the FTX bankruptcy, with a 72% drop in TVL. Optimism TVL declined by 21%, while Arbitrum increased by 29%, with the two most popular Layer-2s showing opposite TVL trends. Aptos had the highest TVL increase among all public chains at 71%, although it was not among the TVL Top 10.
Top-Rated Decentralized Derivatives Exchanges and Liquid Staking Protocols
According to the report, dYdX remains at the forefront of decentralized derivatives exchanges with a 37% increase in its average daily trading volume in January compared to November. On the other hand, GMX has seen a downward trend with a 41% decrease in its average daily volume in January compared to November.
However, the report highlights Gains Network as the biggest dark horse with its average daily volume up 1x compared to November last year and now ranked in the Top 3.
Top-Rated Liquid Staking Protocols
In terms of liquid staking protocols, the total staked ETH on Beacon Chain has increased by 11% in the last three months, with Lido Finance still holding a dominant market share of 90%. Frax Finance has quickly become the best performer with its staked ETH amount rising more than 16 times in less than a month and already ranked in the Top 3.
TokenInsight has also released its latest rating updates on FTX Token, Solana, and Huobi Token. The rating of FTX Token has plummeted from AAA to D, while Solana’s rating has been downgraded from AA to BB due to a decline in developer activities and a drop in TVL by 72%. Huobi Token’s rating has been downgraded from A to BBB due to operational issues and a decline in overall trading volume.
This report provides valuable insights into the current state of the decentralized derivatives exchanges and liquid staking protocols market and is a must-read for all cryptocurrency enthusiasts and investors.
We kindly request that if you make use of these insights, please include a link to our TokenInsight Rating Quarterly Review 2023 January page. This will help us continue to provide you with valuable and informative data-driven content in the future.
About TokenInsight
TokenInsight is a leading cryptocurrency rating and research platform that provides data-driven insights and research to help cryptocurrency investors make informed investment decisions. The platform’s proprietary algorithms and models are based on rigorous data analysis and modeling and are continuously updated to reflect market changes. For more information about TokenInsight, kindly visit www.tokeninsight.com.
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Umar Nisar was born and raised in the busy city of Abbottabad. As a journalist, Umar Nisar has contributed to many online publications including PAK Today and the Huffing Post. In regards to academics, Umar Nisar earned a degree in business from the Abbottabad UST, Havelian. Umar Nisar follows the money and covers all aspects of emerging tech here at The Hear Up.
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