Within the cryptocurrency community, there will be very little complaints about the performance of Bitcoin since the beginning of the year. The major coin by market cap grew by 30 percent in January and does not look to be slowing down after crossing the $10,000 mark twice in February.
This rally has been dubbed the start of a big bull run with many people putting up predictions that will see a new all-time high as early as the Summer. But, Bitcoin’s performance is not even the best around, in fact, it has been quite moderate in comparison to other altcoins.
Usually, when Bitcoin rallies, there are often big jumps from pretty obscure coins that ride the coattails. But what makes this recent altcoin rally different is that many of the coins showing near 2X gains have been from the top 10, or even 20, in the market cap rankings.
That being said, there is a lot of life lower down the rankings, and for some cryptocurrency projects that could be labelled as previously dead and dying. Many had hoped that the ICO bubble burst in 2018 and the subsequent bear market would blow bad projects out of the ecosystem, but those who have held on are starting to rise from the dead.
There is evidence of a number of coins that do not show much promise suddenly doubling or tripling in price and giving hope to investors who could be after a quick buck off a risky investment. These coins are also staying afloat thanks to a bevvy of exchanges still happy to list them.
New coins are also still emerging with exchanges happy to list them, and while the ICO bubble is well and truly over, there was still $3.26 billion raised on new projects last year.
“I’ve long expected the demise of the long tail of alts, and so far been mostly frustrated,” said Nic Carter, co-founder of Boston-based tracker Coin Metrics. “Most of the coins did decline by 90% plus, but didn’t outright fail. It turns out that cryptocurrencies just tend to zombify or fade away over time, rather than dying quickly.”
“More than 1,440 coins have still met their demise, according to dead-coin tracker Coinopsy. But there are about 5,100 coins — the highest number ever — that are still alive and kicking; that’s more than double the 2,073 token count on Jan. 1, 2019, according to tracker CoinMarketCap.com,” explained Bloomberg.
Pump and dump
The dangers of these types of projects staying in the sights of potential investors is that many of them are subject to price manipulation, especially from big money VCs who are looking for a way to boost their investment.
“There appears to have been a large mass of early investors (including many VC firms) who have a vested interest in seeing some of these tokens reach a certain price point so they can realize their gains or break even,” said Sid Shekhar, co-founder of London-based market tracker TokenAnalyst. “As such, with the overall market rally, there are definitely select institutional players who are effectively spurring price action.”