I check coinmarketcap.com almost every 20 minutes in the day so it surprised me when I saw a new cryptocurrency immediately overtake nxt and mastercoin at the time. As of writing this, it has even reached a higher market cap than litecoin. In just a few days the marketcap of Auroracoin skyrocketed to over half a billion, which I found insane. I thought something isn’t right, but I didn’t look into at the time.
Prior to this I had very little knowledge about auroracoin. I’ve stumbled upon it in the bitcoin talk forums but never really gave it any attention. I decided to do a little bit of research and suddenly realized why the marketcap was so ridiculously overvalued.
So basically what I found out was this. 50% of the AURs have been premined, the developers claim they will distribute these coins to the citizens of Iceland. This distribution model, called the “Airdrop” will commence on the 25th of this month. Coinmarketcap.com shows that there are just over 10.6 million AUR. While it is true that 10.6 million AURs exist(or mined), most of these coins are not in circulation. The amount that is actually in circulation is just over 100,000. This means that the actual market cap is just over 6 million and once the airdrop commences, the small amount of coins in circulation will be heavily diluted.
- 10.6 million coins have been mined.
- Slightly under 10.5 million coins have been premined, which is 50% of all the coins that will ever exist.
- Amount of coins in circulation is over 100,000.
- The premined coins will be distributed on March 25th, 2014.
- the REAL marketcap is the amount in circulation multiplied by the current price.(about 6 million at the time of this writing)
- Expect the price to fall sharply near the 25th of March, or perhaps even before to catch everyone off guard.
I suggest if you have gotten in on this run to take your gains as it seems that many people are buying just because they are seeing the price rise so much.
For a little quick overview of auroracoin I suggest you read this article written by one of our contributors.