Although it has been reported that there are earlier related works, it can be said that everything on cryptocurrency have started with blockchain technology and Bitcoin. The pioneering cryptocurrency was created in 2008 by Satoshi Nakamoto – whether he is an invidividual or a group – until now nobody knows.
On October 31 that same year, a link was posted in a cryptography mailing list of the paper authored by Satoshi Nakamoto entitled Bitcoin: A Peer-to-Peer Electronic Cash System. The paper explained in detail the methods of using a peer-to-peer network to generate what was described as “a system for electronic transactions without relying on trust,” according to wikipedia.
Bitcoin is primarily designed as a digital cash. Not more as a store of value, as it is being commonly used now – a digital asset and investment item – by most of its holders.
Years after bitcoin inception, thousands of cryptocurrencies followed, created using blockchain, and other distributed ledger technology protocols that evolved later. As of July 11, 2022, there are 9,897 cryptocurrencies listed in the coinmarketcap.com website.
And it is safe to say that the actual numbers could be much more of these figures. Knowing that there are still lots of existing cryptocurrency not listed in the CMC website, but are being traded already in some crypto exchanges, swapping apps and peer to peer trading platforms. While some are still on its on-going development stage.
It’s unfortunate that of this numbers, only a very few can be considered real cryptocurrency of high potential, it is because the great majority of these digital coins and tokens can be considered “straw” crypto. Or commonly called in crypto lingo – shitcoins. Yes, shitcoins worthy to be thrown. In practical sense for some crypto experts and enthusiasts, some are just that – garbage.
Thousands of garbage, but there are also few that can be considered gems in the cryptoverse. But how can one interested to acquire cryptocurrency, say a newbie for that matter, identify which is which?
US Sen. Elizabeth Warren have told the New York Times last year that cryptocurrency services are “spinning straw into gold,” as she criticized the way they operate outside financial industry rules. She explained that cryptocurrency that functions as shadow banks as “it provides many of the same services, but without the consumer protections or financial stability that back up the traditional system.”
As we see so many cryptocurrency come and go, there are those that announces their project, then folds down in few short years, which a number are even for less than a year period. I myself have even experienced on a crypto project having a pre-ICO sale that had vanished even before its initial coin offering date.
If seasoned investors at times falls into blunders, it’s more likely that new cryptocurrency players are susceptible to “rug-pull” schemes and other investment scams.
No less than Billy Markus, the creator of dogecoin said in his tweet that 95% of cryptocurrency are just scams and garbage. This tweet by Markus came after the failure of the Terra network, leading to the price collapse of LUNA and UST stable coin middle of May this year. This recent Terra fiasco is enough proof that anything can happen in the cryptoverse. Even in those cryptocurrency considered “cream of the crop,” at the top 1% in the coinmarketcap ranking.
These are just few examples of many criticisms of cryptocurrency. But who can blame the critics?
With thousands of cryptocurrencies out there, some with common, unique and weird sounding names, some with their claimed use cases, in supply volumes ranging from hundreds of thousands to quadrillions and quintillions, one may say that the cryptoverse is more like a numbers game. Some of these cryptocurrencies having abundant supply are given away as free initial promotional exposure in airdrops, tips and giveaways. Including simple, less costly earning mechanisms, staking and mining methods.
Yes, this is how abundant cryptocurrency is these days. Whether it has value or not now, this doesn’t matter. What matters is that someone who want to have it, can get hold of some, hoping it will gain value in the future. Knowing that in earlier days of bitcoin, its value is just less than a cent. Then eventually reached its peak so far at $67,567 each BTC in November 8, 2021.
Which of these cryptocurrencies will gain value over time, or which will just end up to nothing, is a good question that crypto enthusiasts should diligently learn to answer for themselves.
After all, who can predict how a crypto that is valued more than hundred dollars each, had in just a month back would end up to almost nothing later – to a micro fraction of a cent. That is how unpredictable, highly volatile and frustrating cryptocurrency prices are.
It is a fact that there really are valuable, promising and legit cryptocurrencies out there. Most legacy coins and newly minted tokens with well-established communities, institutional and corporate industry backing. As well as projects with practical real life use cases, core team and development team composed of respected professionals of good reputation and credibility.
But then, what if a garbage now will eventually turned to be a gem in its own time? What if those shitcoins that some crypto enthusiasts are holding on will eventually shine as a highly valued gem stones. Maybe for whatever reasons, or even miracles. Hoping for hope, could also be a game those in the crypto world is inclined to play. Especially for those who have ample time to dream.
In exceptional situation it will only take a celebrity, or maybe a billionaire to have an interest and favorable tweet endorsement on a particular coin, or token for its price to spike, then gain significant foothold in the crypto market. Never mind the practical use cases, what is important is the demand that can influence the price. Anyway, the most common use case is always there – to be a digital money, and a crypto exchange trading item.
After all of what is being said, it is a fact that the cryptoverse really offers opportunities to earn, and generate value. Despite all the criticisms, the losses, scams, traps and pitfalls, as well as the imperfection of the market environment, and the human frailties of the people having vital roles in the crypto ecosystems and its communities.
So the ongoing challenge is how to identify gems in a heap of thousand tons of crypto garbage.
There can be some basic considerations to be able to identify a possible promising cryptocurrency like practical use cases, background and integrity of the founders and core team, as well as expected future demand in terms of users base, and expansive utilities within and outside of its ecosystem. Basic of course is the overall technological superiority, economic soundness and efficiency of the blockchain, or whatever distributed ledger technology (DLT) being used, including specifics such as transaction speed and fees among others.
Moreover, what also matters is the overall business strategy to be able to penetrate and thrive in the highly competitive crypto environment, as well as the versatility to cope the fast evolving financial technology for it to be sustainable in the long run.
After all the hype and intensive promo campaigns of a particular blockchain or crypto project, it is always the general market sentiment that defines the worth and value of a particular cryptocurrency. Not what its developers and fanatic users-holders set its value to be.
At the end of the day, It’s trailblazing, staying power and remarkable value appreciation that will spell out success of any crypto gem to shine. Finding it before it glows brightly in the open market will always be the challenge of any crypto hunter.
