The Potential for the new Wave of AltcoinsSeptember 21, 2019
The fortune of altcoins has always been a difficult subject for the crypto community because it embeds a level of ambiguity right at the very start. Firstly, the notion of an altcoin has never been determined or agreed upon like many other things in the crypto space. At some point, the ethereum network was considered an altcoin and today it is anything but that. In fact, it is the second biggest cryptocurrency in the world based on all relevant measurements.
The same argument could be made for any of the cryptocurrencies as one goes down the cryptocurrency market cap list. If ETH is not an alternative digital currency, is monero? Or how about ripple, which uses a different type of network altogether. Is tron an altcoin with all of its regional backing in China? No one can tell for sure when it comes to these labels.
Yet, there is no doubt that the altcoin market is real and that altcoins are a fact of cryptocurrency reality. Unlike the major networks, their lives and prices are much more dynamic and volatile, while their opponents would also say that their lives are much more short-lived. But, at the same time, fortunes are made and lost in the same fields and now, many are wondering is the new period for altcoins to shine about to dawn on the crypto market.
The First Wave
Like often in the cryptocurrency industry, people are using the past to gauge what the future might bring, even though the same past is here only a decade long. However, some patterns are visible nonetheless and the first expansion of altcoins is definitely one of them. In many ways, its inception was in the moment in 2014 when it became clear that bitcoin will not die as a result of the Mt. Gox fiasco and scandal.
Before and right after the price crash, many who were sceptical about cryptocurrencies became certain that no asset can survive the plummeting of its price like BTC experienced in that moment. Yet, the network proved resilient above even the most optimistic predictions and bitcoin keep on going, showing that the world of esports, tech solutions and new IT concepts is only emerging.
At this point, people with the blockchain tech know-how met the people with the financial means and the ideas of alternative cryptocurrency networks began to be developed. Ethereum went live in July 2015, but it was neither the first nor the last in this cycle. However, it was important because it offered the ability for other developers to use the ETH standard and native token to build their versions upon it.
Now, that know-how about blockchain could become seriously smaller for anyone to actually build their own cryptocurrency. Many took this opportunity and using the fraction of resources they would need without ETH, created their own tokens and full cryptocurrency networks. With that, the age of ICO or initial coin offering was good to go and it ushered in the true stellar but short-lived expansion of altcoin.
During 2017, the phenomenon of the ICO reached its fever pitch level. Crypto investors were ready to influence money in new and often completely untested altcoins and all had the same bullseye – finding the next bitcoin before it became a planetary cryptocurrency of choice. At that moment, BTC token was blazing. It reached the price of over $19,000 for a single token and some assessment put its value to $80,000 by the end of 2018.
It was the best-performing asset of all time. However, when 2018 came, it brought about nothing close to the idea of BTC hitting close to $100,000. Instead, the bear market struck and the prices of all crypto tokens once again plummeted down unlike anything before. Bitcoin price broke straight down, and so did ethereum and anything else.
Altcoins which were promising just several months before became toxic assets and weekend traders first started unloading, erasing any profit they might have made. Others followed suit and soon, the hot altcoins of 2017 became only footnotes in the crypto hitstory notebooks of the future. The first altcoin boom was over in many was even before it truly began.
Brewing Bull Market
Ever since the spring of 2019, most analysts are certain that the crypto winter of 2018 has finally ended. The rise in the weeks that came after the initial jump-off point has not been astronomical, but it did manage to hold its ground, especially with bitcoin’s price. This means that another jump, again, based on history, could be expected.
There are practical reasons why many believe that altcoins will also go into their second resurgence. Coinbase, the dominant crypto exchange and digital wallet provider recently showcased a line-up of electronics that they are exploring for potential listing. If or when any of these gets the listing, their value will immediately skyrocket.
Among those listed here are some heavyweights of the tech world. They include Telegram coin, based on the very popular chat provider. Others also possess good reason why this juggernaut of the crypto exchange and storage industry would consider them. However, the bull market is what any and all of them need to really make a difference.
Technological Viability above all else
The sad reality is that even with the new wave of price rises, the actual difference is made by those altcoins that can stand their price sharply dropping. This means having a strong technological backing and a viable blockchain network that supports it.
Without it, the new potential bull market will end and the altcoins will vanish without this potential, like they did in 2018. This means that in many ways, things remain the same as in 2016 and the investors will likely behave the same – few lessons are ever learned in the wake of a shiny new bull run where the fear of missing out kicks into high gear. New altcoins will dazzle many in that period, whenever it might arise, but only a handful will survive to wait for the next wave.