THE huge rise in the price of Bitcoin has rightly attracted attention over the last few weeks. The world’s dominant cryptocurrency more than trebling in 18 months to briefly reach new all-time highs north of $73,000. It has been a remarkable turnaround after the winter that stretched from 2022 into much of 2023.
A lot of it can be put down to the hype surrounding the approval of Bitcoin exchange traded funds (ETFs) earlier this year. This unlocked huge amounts of capital that has been followed by positive noises from the UK’s regulator about similar moves here.
THE RISING TIDE
What of the vast number of other cryptocurrencies out there? A rising tide has lifted most – if not all – boats from the doldrums of the past year, but not all projects are necessarily equal. As I’ve pointed out previously, around 24,000 cryptos have been listed on CoinGecko since 2014 and more than 14,000 have since ceased to exist, for a variety of reasons.
All but one of these are so-called ‘altcoins’ – which, by definition, are any tokens that are not Bitcoin. But within that there are different categories: memecoins are intended as a joke or for gambling within a particular ecosystem, for example, while s***coins are mostly just scams.
The level of interest in altcoins is measured by the Blockchain Centre, which decides whether it is ‘altcoin season’ based on whether 75% of the top 50 coins performed better than Bitcoin over the last 90 days.
ALTCOIN SEASON
As we speak, it is not yet altcoin season, with only 55% of those tokens doing better than Bitcoin. Although both Bitcoin and Ether are at all-time highs, the total market ‘only’ stands at $2.69 trillion. This compared to the previous peak of $3 trillion.
Still, with Bitcoin stealing so much attention, it is worth looking beyond it to other projects doing some interesting work. A good place to start is perhaps the best-known altcoin, Ether. Ethereum is the project behind Ether, and the two names are used largely interchangeably. Ethereum is the base on which a range of other decentralised applications – or dApps – are built and Ether is the community’s native token.
The price of Ether has jumped up almost in tandem with Bitcoin’s. There is also a lot of excitement over the prospect of Ether ETFs, providing retail investors with quick and easy exposure to the token price in a regulated environment. Whether that comes to pass remains to be seen. But in the crypto world many roads lead back to Ether given the central role it plays in much of the infrastructure.
Chainlink, Cardano, and Polygon are among the other best-known altcoins, with their own respective uses. Chainlink connects existing systems to public and private blockchains. Cardano’s token ADA enables peer-to-peer transactions, while Polygon’s Matic helps to scale the Ethereum network. All of them have been written about extensively elsewhere.
Less talked about is Green Bitcoin. It is designed to be more environmentally friendly than its namesake and allows holders to stake their tokens in return for rewards. Anyone who buys Green Bitcoin can also use it to speculate on the price of Bitcoin itself.
MEMECOINS
It wouldn’t be right to not at least talk about memecoins as well. I only do so with the aforementioned caveats that anyone considering ‘investing’ in them should know upfront. That they have no intrinsic value and holders should be prepared to lose all of their money.
The eponymous meme.casino allows you to swap any memecoin for tokens to use at its casino facilities. You will only get paid out in the same token you put in. But there is the intention of an exchange within the system at some point which will make things a bit more fun for fans of Dogecoin, Shiba-Inu token, and others of their ilk.
Finally, given the current preoccupation with everything artificial intelligence (AI), it only feels fitting to end talking about the growing number of cryptocurrencies making use of the technology. One such project is Scotty the AI, which also embraces the label of being a memecoin.
Remember, there are thousands of altcoins out there and not all are going to be what they claim. Do your own research and only invest what you can afford to lose. Prepare yourself for the onslaught of information that will follow from a range of projects.
