A Few Coins That Are Down, But Not Out

In this article, we review three coins that are potential buy opportunities and that are perhaps very fit to survive any sort of “altcoin apocalypse,” if one should manifest itself in the future.

Despite the price of BTC being up almost 3-fold since its bottom last December, altcoins have been a bit slow to follow. The reasons behind this are probably a combination of things, with the number one among them being the fact that this time around, investors are more skeptical now of the altcoin market than they were in 2017. Additionally, the term “ICO” has now become nearly synonymous with the word “scam,” leading to a massive popping of the ICO market bubble in 2019, which so far has seen just a small fraction of dollars raised when compared to this time last year, or in 2017 as well.

So far this year, the total market cap of all coins has grown by $140 billion, or 111% — not too shabby. However, BTC has accounted for almost all of this. If BTC is subtracted from this calculation, the total market has added only $17 billion, or 28% of its value since January 1st. In short, altcoins have been lagging by a tremendous margin in 2019. Most of the major altcoins have posted only modest gains this year, though a couple have actually surpassed BTC by quite a bit. These include Chainlink (LINK), up an astounding 490%, and Binance Coin (BNB), up 270%. A greater portion of top-tier coins are actually in the red, however, and these include:

  • Maker (MKR): -3.5%
  • Zcash (ZEC): -19.5%
  • TRON (TRX): -24%
  • NEM (XEM): -28%
  • Ripple (XRP): -29%
  • IOTA (MIOTA): -34%
  • Stellar Lumens (XLM): -47%
  • Cosmos (ATOM): -59%

The result has been a significant increase in BTC’s share of total market cap dominance, which has grown 20%, from around 50% to an amazing 70%, over the course of the year thus far. The last time BTC saw this kind of dominance was all the way back in March 2017, right when the crypto market was taking off into its all-time highs later that year. Historically speaking, BTC market cap dominance only rises when the crypto market in general is on the decline; however this time around, BTC is growing while other coins are growing not as quickly, staying the same, or falling in price.

The market cap dominance of BTC (top line) has been growing, while that of most others has been shrinking. Source: coinmarketcap.com

 

Does this mean that the altcoin market stands a slim chance of making a comeback, and that all alts are being left for dead? Hardly, and it’s highly doubtful to be the outcome. However, what it does mean is that investors are less optimistic about alts than before, and it will be all the harder to pick a winner well into the foreseeable future. The truth is that most coins were overvalued by a severe degree, stemming all the way back from their run-up in late 2017 / early 2018.

In the rest of this article we’ll be discussing a few coins which we think stand out above the rest and are potentially fit for long-term survival in the event of an altcoin apocalypse. Bear in mind that the following is not investment advice, and things could sour for these or any other coins at any given moment due to the volatile nature of the crypto market. However, we do tend to prefer chances of these coins’ survival over others.

 

Grin (GRIN)

Consensus algorithm: Cuckoo Cycle POW

Current market cap: $40.1 million

Current price from ATH: -80%

What is it? A lot of coins these days market themselves as having “next generation” blockchain tech. Being the first coin to implement the MimbleWimble blockchain protocol, Grin truly is next gen tech when it comes to cryptocurrencies. It makes the most of cryptography by not requiring addresses or transaction amounts to be stored in the blockchain. This allows it to be not only more lightweight than most traditional blockchains but also guarantees a good deal of privacy in ways previously unexplored.

The pros: With one minute block times and a highly scalable blockchain design, Grin is all set to be a highly competitive form of digital money going well into the future. Advanced, foolproof anonymity in transacting is also a healthy plus.

The cons: In its current state, it’s somewhat clunky to use and requires a bit of brain rewiring in order to understand how it functions. There are also 60 coins produced every block (one minute) – forever – making it highly inflationary.

Outlook: Granted that it’s fantastically talented dev team sticks to the project and helps see the healthy development of their newborn coin, Grin looks like a winner in the future. For the moment, however, it faces the normal problems of any new coin (like lack of user and merchant adoption), and its rate of increasing supply means that it will inflate faster than most others. It may be best to hold off for at least 3-6 months before purchasing Grin, but if it’s still in the top 100 coins by that point, it will be much more of an attractive investment than it is now.

 

Holo (HOT)

Consensus algorithm: N/A (uses an accountability-based system with data validation by peers)

Current market cap: $112.4 million

Current price from ATH: -67%

What is it? Named as one of Coin Clarity’s most interesting projects of 2018, Holo – or Holochain – is a novel attempt at internet decentralization by relying on individual users to host DApp data and perform services for the larger user base, instead of relying on traditional service providers. In exchange for dedicating storage or processing power, Holochain nodes are rewarded with tokens. The Holochain team describes their system-native token, Holo fuel, as an “asset-backed mutual-credit crypto-accounting system.” The fundamental architecture for their cryptocurrency represents a drastic change from blockchain structures underlying traditional cryptocurrencies. Users do not need to be in constant sync with the main blockchain, instead keeping their own versions of the blockchain and only syncing with the entire network when necessary.

The pros: Of all the “decentralized internet” cryptocurrency-related projects out there, Holo has probably put the most work into their development and made the most achievements. They stand a good chance of being able to free internet application usage (especially in the form of DApps) from the bonds and limitations of classical ISP’s (internet service providers), and in a way are creating a new, fairer internet, from the ground up. Developers seem extremely committed to seeing the project through to the long-term.

The cons: It’s still very early in the game for Holo. User adoption has been a bit slow, and will probably not pick up in pace until more internet users find their standard internet services are longer bearable. Requires specialized hardware only purchasable through the Holo website in order to run a node, which is a bit pricey.

Outlook: Another long-term project that should be avoided by those looking to “get rich quick.” As mentioned above, if an increasing trend of internet users become dissatisfied with their ISPs and DApp usage rises in popularity, they will undoubtedly be looking for alternative ways to connect to the internet, and Holo will be there – with infrastructure in place – to help them out. This would give value to the Holo fuel token and therefore make it a savvy investment at current prices.

 

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Basic Attention Token (BAT)

Consensus algorithm: Proof of Work (Ethash) (Ethereum token)

Current market cap: $229 million

Current price from ATH: -83%

What is it? Known as the “system native token” behind the Brave browser, the main idea behind Basic Attention Token is to create an open-source, decentralized ad exchange built atop the Ethereum platform. It was largely developed by the creator of JavaScript and co-founder of Mozilla, Brendan Eich. The main goal of BAT is to attract web advertisers to the Brave browser by countering fraud in digital advertising. It aims to do this by measuring and “correctly pricing” user attention to different advertisements across the web, thereby allowing advertisers to get the most for their money. Advertisements are paid for using BAT, which is awarded to average internet users for viewing ads, and performing other passive tasks within the Brave browser. In addition, users can donate BAT to websites which they find valuable.

The pros: Brave is a great web browser. It is stable, privacy-centric, and can collect information about its users browsing habits while allowing them to remain completely anonymous at the same time. In this way, it is a far better alternative to the likes of Google Chrome and Microsoft Explorer. For users who value privacy while retaining a fluid internet experience, Brave is a strong choice for browsing. For advertisers, Brave’s quantification of user browsing behavior allows for a much more highly sophisticated means of targeting. The more users who flee Chrome and Explorer for the likes of Brave in the future, the higher the price of BAT is bound to go.

The cons: Again, user adoption is the main uphill battle which Brave faces, regardless of how astoundingly huge the market is. Brave was the subject of some controversy last year when it came to light that a few giant websites could not access thousands of dollars worth of BAT donations from website visitors, thought the issue seems to have been resolved.

Outlook: BAT is a solid pick on both fundamental and technical levels, as its price seems to have reached a technical low point, which makes it a decent investment in the short, medium, and long terms. As the popularity of the Brave browser continues to rise, along with the worldwide adoption of crypto, so should the price of BAT. The only thing keeping it down would be a continued, sustained drop in the price of ETH, in which case BAT should at least be able to remain flat in price.