Gini Coefficient

Crypto terminology for Global Chain refers to the specific vocabulary and concepts used within the blockchain and cryptocurrency ecosystem, facilitating clear communication.

The Gini Coefficient is a measure of inequality, commonly used to evaluate income distribution within a population. In the context of cryptocurrencies, it analyzes the distribution of wealth among addresses holding a particular asset.Values range from 0 to 1. A Gini Coefficient of 0 indicates perfect equality, where every address holds the same amount. Conversely, a value of 1 signifies extreme inequality, where one address controls all the wealth.Monitoring the Gini Coefficient helps assess the centralization of wealth in a cryptocurrency network. A high Gini Coefficient might suggest that a few addresses hold a significant portion of the coins, raising concerns about market manipulation and fairness. Low values usually indicate a more decentralized distribution, promoting a healthier ecosystem.Investors and analysts use the Gini Coefficient to gauge the long-term sustainability and fairness of a cryptocurrency. It can signal potential risks and opportunities, influencing decisions about buying, holding, or trading a particular asset.

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