What’s in store for altcoins this year? Well, one industry insider sees death for a number of altcoins, another reminds of good signs that will help altcoins this year, while a third says we might need a change in terminology.
A bull was reigning the crypto market since the end of 2020, while this week we’ve once again witnessed the market’s volatility. Bitcoin (BTC) has dropped some 20% from its all-time high reached just days ago, ethereum (ETH) fell 23% since its weekly peek, with numerous altcoins following suit and correcting downwards. Nonetheless, for now, the crypto market remains for the most part green in the past week, with six out of the top ten coins’ prices appreciating.
That said, industry figures see both death and prosperity for altcoins – but it seems to come down to technology, positioning, and use cases.
1. Trilemma, cemetery, and place in the world
Sinjin David Jung, Managing Director of IBMR.io (International Blockchain Monetary Reserve), which is a long-time partner and a supporter of Algorand (ALGO), told Cryptonews.com,
“I expect, in general, that the altcoins that truly have a use case and have solved the trilemma problem to some degree will do great.”
However, he warned that the future is dark for altcoins that don’t have a use case other than being a speculative investment: “I foresee a lot of altcoins dying in 2021-2022.”
Also, while bitcoin seemingly has a firmly established narrative, it will be crucial for altcoins to “find their narrative and place in the world.”
“Will litecoin continue to be the silver to bitcoin’s gold? Who knows, let’s see what happens in the new year, but I think it’s really now about adoption and positioning more than the technology,” Jung said, adding, “I think any company that’s still working on a protocol that hasn’t launched yet, it is not going to happen for them.”
2. Good signs
Meanwhile, there also seem to be indications that major altcoins will not only survive but might see wider adoption this year. Konstantin Richter, CEO and Founder of blockchain infrastructure platform for node management Blockdaemon, argued that, while the original and largest cryptocurrency, bitcoin, continues to be the main driver of both retail and institutional adoption, giant institutional players that are entering the crypto markets, such as PayPal, have not limited their strategy to the adoption of only bitcoin and offered ETH, bitcoin cash (BCH) and LTC to their clients also.
Therefore, Richter said,
“This approach would seem to indicate that a number of both emerging and established altcoins, alongside the big two of bitcoin and ethereum are here to stay.”
3. Name game
For some among those that do survive, a name change to something more suitable might be in order. Jack O’Holleran, CEO and Co-Founder of decentralized network SKALE, said that we’ll get a better term than ‘altcoins’ as now we have “real networks […] up and running,” that are powered by real tokens. “This includes networks like SKALE, Celo, Polkadot, Solana, Near, and others which will be known as networks first and coins second,” said O’Holleran, adding,
“Maybe we’ll call this category network coins rather than Altcoins.”