This year was mainly dominated by Bitcoin and we are still waiting for the so-called “altseason” in which the smaller coins perform well. According to popular analyst Route 2 FI, there may be a very good reason for the lagging altcoin season.
Why are altcoins lagging behind Bitcoin?
According to Route 2 FI, the reason that little money is flowing into altcoins anymore, or at least very selectively, is that most new tokens can no longer be trusted.
According to the analyst, many tokens are launched with a group of wealthy investors, who were allowed to get in very early. The tokens then appear on an exchange platform and the first thing those rich people do is press the sell button.
As a result, the tokens dump and a new project quickly loses its “heartbeat” in the graph.
The more we see this, the more selective people become. Could the Bitcoin maximalists be right in their idea that Satoshi Nakamoto’s invention may be the only interesting coin?
Altcoins are not scarce
In principle we can develop an infinite number of new tokens and that is of course the problem. Ultimately, altcoins are not scarce at all and if you are very honest, there are very few projects that actually provide something of value.
The value proposition is of course beyond dispute for Bitcoin, but the same does not apply to altcoins. Even Ethereum has yet to find its so-called “killer app” and is still looking for an application that can live up to its billion-dollar valuation.
“At a certain point, supply will far exceed demand,” is the simple conclusion of Route 2 FI when it comes to the launch of new altcoins.
That seems to be happening slowly now. People will also notice that there are very few projects that “succeed”, whatever that means in this world.
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