Bitcoin & Alt Coins in Early Days
Back in the old days, say eight years ago, there was Bitcoin (BTC) and there was everything else. Since Bitcoin was the first cryptographic currency, it always had a special treatment. All other coins were considered alternative coins (alternative to Bitcoin) and thus were called “alt coins”.
There were always many alt coins as it is relatively easy to create a new crypto coin. What was difficult, was for a coin to have utility and consequently to be recognized and adopted by many. The competition among various coins was always fierce and many alt coins never lasted for very long. Great number of them went down to “zero” and ultimately ceased to exist.
Since many alt coins perished along the way, the case was even stronger that the only crypto worth having was Bitcoin. While Bitcoin was always very volatile and many would say risky, holding alt coins was even worse – more volatile and even riskier.
Present Day Crypto Coins
Fast forward to today, we see many crypto coins again. However, the technology of crypto sphere has advanced tremendously and we need to have another look. Yes, Bitcoin is still around and it probably will be around for a while in future. But the dominance of Bitcoin has diminished significantly.
There are few alt coins that have raised to virtually the same level as Bitcoin and it is not hard to imagine that these coins may surpass Bitcoin in the future. Examples are Ethereum (ETH), Cardano (ADA) and Stellar (XLM), just to name a few. One can observe that some of these solid coins have everything Bitcoin has to offer and more. Because of advancements in cryptographic technology, some alt coins have been developed with serious utility, many times offering breakthroughs in new directions and solving real-life challenges and issues.
One has to be always vigilant as poor alt coins are still around and number of them pop out on a daily basis. Some have little or no utility whatsoever. Some are being hyped while there is no real “meat” behind the hype. Some are outright scams.
Crypto Paradigm in the Future
The expectation is that evolution of crypto coins will continue, which will bring many coins of an excellent quality to the forefront of crypto scene. We refer to these coins as grade A coins. Some of them will at least be on par with Bitcoin, while others may actually surpass it.
In terms of investing, we are interested in appreciation of price or value we hold in any given coin. It turns out that many great coins may have significantly better price appreciation than the Bitcoin. Our objective is to identify those coins and include them in our portfolios. While Bitcoin may still be considered “king of the cryptos”, it will not be the fastest horse in the race, and also not the one with the lowest risk.
At the same time, there will be other, more speculative coins that may bring, sort of, overnight riches at the cost of significantly higher risks. As an example, Shiba Inu (SHIB) comes to mind. While we would not exclude those, portfolio weighting of such coins would need to be carefully assessed. After all, if a coin skyrockets 1,000 times, not much capital needs to be put into it before we see some serious valuations!