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BlockchainBusiness & Finance

Crypto Market Cap Adds New Coins Everyday, Here Is Why Not All Will Survive

The cryptocurrency market keeps on adding new coins almost by the passing day. While it cannot be stated for all to not bring any inherent value to the market, there are some and perhaps most, that only exist to die off in the long run. Basically, the crypto market runs on the basis of value addition. This reinstates that as long as a coin has value and application, it will continue to sustain. As soon as it becomes stagnant and a mere source of investment for HODLers, it loses life. Not only that, it also loses interest from investors and whales, which dilutes price to a point where it is unlikely to go back up. Hence, not doing the HODLers any favors either.

Clem Chambers, CEO of Online Blockchain plc shared the very opinion in conversation with Block Publisher, when asked why newer tokens keep coming into the market when it is known that they will not survive come advanced times. He also explained how value is related to sustainance for a coin and said:

Coins that have strong use cases have a good chance of survival those that don’t are doomed to failure; it’s as simple as that.

Miners make coins, which increases the money supply. If a coin doesn’t have a use case – i.e. a purpose – there’ll be an increased money supply but no actual increase in currency use.

Coins that do not carry ample valuation only render as a source of investment for HODLers and individuals that want to keep investments in material assets, but even die off soon from that. This means that these HODLers also lose money and it becomes as lose-lose situation. Chambers further explained:

If there is no application for a coin only HODLers of said coin take up the supply. Therefore, further supplies dilute the value of the coin lowering the price. This has the knock-on effect of HODLers losing money, which makes it highly unlikely that they’ll invest more.

It is apparent, that the crypto market is built over a few top coins only and the rest of it plays a back end role in maintaining the market or as mentioned, serves as a source of investment. Apart from these top coins, it is hard to envisage survival for most when real adoption and regulation comes about. When the time comes, it will only be value and application that will help run the longer marathon.

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Razi Khan

Researcher, Electrical Engineer and a teacher, Razi is one who takes great intrigue in the prospects of blockchain and cryptocurrencies (BTC in particular) while contributing a critical approach over the subject regularly. Contact the editor at editor.news@blockpublisher.com

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