Extinction Threat: Many Altcoins Would Not Survive the Current Bear Run

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Extinction Threat: Many Altcoins Would Not Survive the Current Bear Run
It is well known within the crypto community that hundreds of digital tokens are either worthless or serve no unique purpose, either now or in the future. Photo Credit: kylebstiff

The month of August has seen an intense bear run that has covered the entire crypto market in blood. While bitcoin lost nearly all of the gains it made in July as its price fell by more than $1,500, the altcoins have even been worst hit.

Data from Coin360 shows that most of the altcoins have suffered huge losses in the same period, with many of them down some 80-90% from their all-time highs while trading at below their price levels for this time last year.

Ethereum, the largest altcoin by market capitalization plummeted to a 9-month low as its price hit below $300. It lost over 28% and 33% of its value over the last week and month respectively. Indeed, almost all of the other top 20 altcoins on CoinMarketCap’s listings suffered significant losses that could threaten their long term survival.

A number of experts have predicted that as many as 80-90% of all cryptocurrencies stand a chance of going extinct in matter of years in a possible cryptocalypse. Some like Ted Rogers, the president of crypto wallet provider Xapo, believes the foretold extinction may in fact already be here. In a tweet on Thursday he said:

“We could be in the midst of the extinction-level event for ‘cryptoassets’ that many maximalists have predicted. 90%+ of @CoinMarketCap list will disappear eventually – might as well happen now.”

It is well known within the crypto community that hundreds of digital tokens are either worthless or serve no unique purpose, either now or in the future. Those low quality coins or shit coins as they are commonly known are often part of bogus ICOs which the SEC describes as elaborate scams meant to defraud the unsuspecting public.

In July, DigitalCoinNews reported on a study that showed that no less than 800 altcoins were either now dead or insolvent with a value of less than 1 cent.

While it may be difficult to foretell the survival chances of any altcoin, experts say one of the most important factors to consider include its performance records; how it has fared against past market turbulence. Other factors to consider include the functionality of the coin, its unique selling point and its level of adoption by the crypto community.

Caution is therefore the key for all altcoin investors. As at the time of reporting, there are some 1,845 different altcoins listed on Coinmarketcap, a sizeable number of them are poor imitations of already existing crypto projects while many of them are overhyped products with no real value that are expected to die out naturally, and the current bear run may just hasten their demise.