While many people have dismissed Bitcoin and other cybercurrencies as “not real money” Goldman Sachs started a trading desk for cryptocurrencies. As blockchains are proving to be a way to secure online currencies, we might just be seeing the tip of the cybercurrency iceberg.
The Cryptomania Craze
For investors who watched the fluctuations with Bitcoin amid regulatory threats, the ICO (Initial Coin Offering) market has accelerated. Cryptocurrencies tied to unknown and sometimes unnamed startup companies are seeking venture capitalists and willing investors.
As new cryptocoins enter the market and more disappear, the values cannot be dismissed. What looked like a fad is quickly growing into a $650 billion market with thousands of unknown currencies. There may be growth opportunities with cryptocoins in the future.
Here are few examples, and no, I have not invested in any of these:
Tron is a business startup with cryptocoins worth about 9 cents, (midday estimate May 5, 2018) while NEO is another cryptocoin startup which is worth about $150 per coin.
Bitcoin started in 2012 at $15, grew to just under $20,000 and is now trading at about $9,900, (May 5, 2018). It’s a big gamble some investors are willing to take. Even a small investment of $100 won’t impact anyone too dramatically, and therein lies the lure for cryptocurrency investors: the hopes that another Bitcoin is just around the corner.
My Lyft driver in San Diego this week claimed he has made enough driving Lyft to invest $13,000 in crytocurrencies. He believes it is safer than any government sponsored dollars, and that it is “safe” from regulations and oversight. (He also claimed to have survived in the Nicaraguan jungle for 9 months by eating organic plants.) While he is probably never going to serve as my financial advisor, many people believe as he does – that a global, online currency is the future.
Cryptocurrencies to Watch For
Market Watch believes more cryptocurrencies like Bitcoin will take center stage this year. Hitesh Malviya of It’sBlockchain believes 10x gains may be possible with alt-coins. With about 1,300 different alt-coins, here are just a few to monitor, and no, I don’t have any of these either:
Litecoin (LTC) was started by Charlie Lee, a former Google employee. In December, it was up 6,000 percent based on the past 12-months. It was started in 2011 and there are about 54 million coins in circulation.
Neo was started by Onchain CEO Da Hongfei and Erik Zhang, co-founder. Up by 83,000 percent, it’s positioned behind Bitcoin with a market cap of $61 billion. There are about 65 million Neo in circulation for a total of 100 million Neos.
Monero (XMR) was up 2,500 percent in December, but the anonymous cryptocoin company may have some concerned. There are about 15 million Monero cryptocoins in circulation.
Ethereum (ETH) has a $100 billion market cap and was trading at about $1,000 as of 1/30/18 (prior to market close). There are about 97 million ETH in circulation.
Ripple (XRP) was up over 40,000 percent in December, and has a market cap of $95.45 billion. It was created in 2012 by Ryan Fugger, Chris Larsen and Jed McCaleb. It works with blockchain technology for over 100 different banks.
Cardano (Ada) has been up by 3,296 percent with a market cap of $20 billion. Created by Input Output Hong Kong, a blockchain developer, they believe now is the time for next-gen platforms. Still only a few months old, they’ve had massive gains and hope to be a contender for Ethereum.
Cardano bases their blockchain network on scientific philosophy and peer research when they started the project in 2015. There are 26 billion Cardano in circulation with a total of 45 billion coins.
According to strategist, Tom Lee, despite investors who missed out on the initial Bitcoin craze, there may be potential with smaller cryptocoin investments, and investors can look at alt-coins and platform tokens. Just keep an eye out for potential fraud with anonymous startups and beware of the potential market bubble.
I personally don’t love cybercurrency (because it seems like imaginary money), but I cannot deny the explosive growth and interest. For something to be considered money, it has to be a medium of exchange and a store of value. People have had a tough time with Bitcoin liquidity, which diminishes the store of value. If you cannot redeem the currency or exchange it, it is worthless, but there is no denying that cryptocurrencies are growing.