Visualizing The Unparalleled Explosion In Cryptocurrencies

Tyler Durden's picture

After the massive Bitcoin price surge in November 2013, the popularity of launching new cryptocurrencies took off along with it.

In fact, as Visual Capitalist's Jeff Desjardins notes, if you go back at historical snapshots around that time, you’ll see that there were literally hundreds of new coins available to mine and buy. Here’s one from November 2014 – a time when there were only 32 coins that were worth more than $1 million in market cap, and 354 coins that were worth less than $50,000, usually trading for tiny fractions of a cent.

It seems like everyone and their dog were launching cryptocurrencies back then, even if they were a longshot to materialize into anything.

Then vs. Now

Fast forward to today, and things haven’t changed much – many people and companies are still launching new cryptocurrencies through a mechanism known as an ICO (Initial Coin Offering).

The only difference?

Today, there is real money at play, and in 12 months the number of cryptocurrencies worth >$1 million has soared by 468%. Meanwhile, the total value of all currencies together has skyrocketed by 1,466%.

Cryptocurrency is so hot, in fact, that raising money through ICOs has become more effective than traditional early-stage angel and VC funding.

For the long-time advocates of Bitcoin and other cryptocurrencies, it is now their moment in the sun.

And with this ICO activity and a wealth of opportunities emerging, a new breed of Bitcoin millionaire has been born. Like the wealthy tech founders that exit and give back to their local startup ecosystems, these new digital tycoons are using their newfound wealth to invest in upstart crypto projects that show potential – ultimately, further enhancing the ecosystem.

Out of the Woodwork

Of course, whenever there is a massive surge in prices and speculation, there are two other players that tend to come out of the woodwork.

One is of the scammer and shyster variety, and certainly crypto-fueled scams are a concern for everyone else in the broader ecosystem.

Perhaps even a bigger threat, however, are the regulators – and in recent weeks the SEC has voiced concerns about ICO “pump and dump” schemes, while Canadian authorities have clearly stated that “most ICOs need oversight”.

With the market exploding with hundreds of new cryptocurrencies and the total value reaching $177 billion, a new series of questions has emerged: what risk do ICO scams ultimately have on market? And, could misguided regulation disrupt the momentum of the crypto boom?

Courtesy of: Visual Capitalist

 

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Haus-Targaryen's picture

Tulipcoin. 

From what I've seen, you have two kinds of cryptos: 

- Truly decentralized cryptos with no Cayman LLC behind them; blockchain based; truly fixed M2 limit and open source.  All sound nice, regrettably as more and more people jump onto the blockchain you'll start measuring transaction clearance in weeks. Good luck trading that/it having value. 

- Cryptos with a LLC somewhere in the world behind them, modified block-chain, most have no fixed upper M2 limit and "open source" in name only. Fast transaction clearning times, but these are essentially worse that fiat for a storage of value. 

I'd like to invest in the top one with the transaction clearance times of the second. Anyone got any suggestions? 

The central planners's picture

The scam its not the ICO its the cryptos itself. Basically anyone can make their own and make free fake money.

Haus-Targaryen's picture

If you could have all of the BTC benefits without the week-long transaction confirmations you'd have a winner. 

I haven't seen one yet. 

CoinCube's picture

Bitcoin hopes to achieve this with a roll out of lighting networks where small day to day transactions are managed off chain which would also make them semi-private. These do not yet exist.

Haus-Targaryen's picture

The other concern I have with the cryptos no one seems to want to talk about is this thing called Stuxnet. 

 

sickavme's picture

With the flip of a switch(or the click of a mouse), all your bitcoin dreams will come true...

 

... or die a fiery death.

bwh1214's picture

If you listen to the wrong people you miss out on stuff like this.

Here's a video response to bitcoin bashing Chris Duane's challenge.

http://www.themonetaryreset.com/2017/08/duane-challenge-accepted-and-wag...

HungryPorkChop's picture

Sept 1, 2017: (Posted from Litecoin's blog): The first Lightning Network based Litecoin transaction is successful! Instant, zero fee! How amazing is that?

JustUsChickensHere's picture

I haven't seen one yet.

I have. DASH - in the top 10 valuation. Actual open source. The feature you are talking about is called InstantSend.

More importantly, DASH has a transparent (literally) governance model. Changes are controlled by an economic majority, but proposals for activities/changes can be sumbitted by anyone.

Currently under utilised with a 1Mb block limit. Upgrading to 2Mb very shortly. Testing (on testnet) has found ways to get 400Tx/sec.  An ongoing research sub-project has a goal of > 4000Tx/sec.  That capacity wll be available well before it is needed.

Not perfect, but very good.

Haus-Targaryen's picture

Fixed m2 cap? No LLC behind it somewhere? 

magnetosphere's picture

dash and bitcoin cash are what you are looking for. on chain scaling, big blocks, everything else is just white noise.

dussasr's picture

Dash has a fixed coin supply cap.   Development is self-funded by the blockchain itself through DAOs (distributed autonomous organizations).  These DAOs may or may not form legal entities to perform their tasks.  It's not a substantial risk, however.  If a legal entity is attacked by a government they will just be rolled up and the work will shift to a more favorable jurisdiction.  It's a brilliant setup that has the best of both worlds - efficiency of an organized structure with the resiliency of a decentralized structure.  

tmosley's picture

So terrible that people be allowed to do things they want to do, or have choices or competition.

Why can't they all just die so PMs will have value?

Haus-Targaryen's picture

Freedom, choices and competetion are all excellent things. 

The problem is when a group of peopel can speak currency into existance, it is by default "fiat".  

 

Sabibaby's picture

People need a way to buy things from people on the other side of the planet without their respective governments getting involved and not paying a ton of money for the transaction.

 

Haus-Targaryen's picture

Agreed completely.  

Looking for something:

- Fast tranaction/confirmation time

- Fixed M2 

- Open Source

- BlockChain

- No LLC/S.a r.l./GmbH/LC behind it 

You'll then have my attention. 

Greenspazm's picture

Even if all of these conditions are fulflled, your cryptocurrency is still inherently valueless because it consists purely of digital electronic states in a computer network that are backed by nothing tangible. It relies purely on consensus between you and a vendor - i.e. fiat -- that these digital nothings have "value"

The USD is also a digital electronic entry in most cases but it works for purchases, payment of taxes and settlement of debts by virtue of government force.

Sabibaby's picture

If you can trade something for drugs and pussy it has value

 

doctor10's picture

In a surveillance society -essentially all big governments today which basically share tools-all opportunity for arbitrage is stolen by the sociopsyopaths pre-occupied with going through everybodies bank accounts, real estate holdings, tax returns and health records seeking "opportunity".

Not much business can be done profitably. At the end of the day its why interest rates -at least in 100% traceable accountable taxable regulatable and ultimately takable currencies are basically 0% give or take a few fractions of a percent-worldwide.

FWIW if you want to borrow BTC now interest rates can be 12-13%!!

"value" is anonymity and privacy in conduct, thought and action-one of the consequences of which is enhanced ability to keep the fruits of your own labor. It also is the only means through which productivity can increase across society. Electronic/digital currencies actually fulfilling those needs will be the most valuable-there is yet to emerge one that clearly does so.

Ask East Germany and the Soviet Union exactly how well a surveillance society worked out during the 20th century. The 21st is no different in that regard

Maj's picture

My Litecoin transactions

  • clear in about 1 second
  • its open source and 
  • blockchain based 
  • IDK about the other points

Id like to see LTC pegged to silver, but that's another discussion.

HardAssets's picture

'fiat' is declaring that something must be accepted as money - ultimately backed by physical force.

walmarde's picture

Freedom of choice does not garanteed "best choice". If people want to trade in SodomCoin, what's the problem ?

If they want to choose fiat and are free to do I see no problem at all. Freedom does not eliminate cupidity nor stupidity.

Some people tend to think freedom equal perfect world with no bad choice or choice everybody understand. Freedom also mean choice YOU obviously don't understand. If you are a real freedom lover you should say this :"I think bitcoin is stupid but I believe people can do this bad choice if they are free to do so"

Peace

TheBigComic's picture

Yes!, The equation is simple. Average people everywhere are waking up to the knowledge that the currency (and its value) is controlled by the "guberment"! What a thought! Slowly ... slowly they are waking up that "central banks" have something to do with the prices they pay at the grocery store ... Ooops. And that central banks have something to do with the flow of money (liquidity) to banks, hedge funds, corporations ... burp! And that this has something to do with stalk values. ... burp. And that they are out of the loop ... BURP!! And that the currency is being devalued ... burp. "Ahhh paid twice as much for take out!!!" ... HMMM anything out there can provide hedge against a rigged game!!! ... BURP!!! "Well, i don't know much about this bitchCOIN but I'm tired of getting screwed I might put some money into that bitchCOIN ... you never know ..." BURRRRRRRP!!!! =)

TheBigComic's picture

Miss foneStar ... He gave me laughs =) And knowledge. ... anyone remember the turd? ... Maybe this whole site is an advanced AI algorithm. =)

DavidC's picture

Don't know about Miss fonestar although I remember her/him, however Turd's still active but doing his own thing;

https://www.tfmetalsreport.com

DavidC

The central planners's picture

When i said they must not be allowed to do it? But im also allowed to avoid to be scammed with this joke.

freedomhub.pl's picture

IOTA is the cryptocurrency you are looking for.

Jaspergers's picture

Haus if there was one that met your criteria they would rub it in your face (which would be great coz I'm looking for the same thing). Instead you get downvotes for making a good point lol.

Hyjinx's picture

XEM (NEM foundation) is probably one of the best.  Low key price, high technology behind it.  They will be implmenting a new C++ codebase in the coming months which will only make it better.  Once they actually start marketing it it might take over.  They also use a "proof of importance" metric which actually encourages people to use XEM in transactions - not just horde it as a speculative investment.

Beyond Organics's picture

Better than gold, this is what the future of ICOs looks, sounds, feels, smell, and tastes like.
MOE Farms
http://moefarms.com/

 

JimmyRainbow's picture

actually crashing hard again, 25% down

TheBigComic's picture

Ya, big crash, 1000 a year ago and crashed back down to 4,300 ... wow what a crash!!

Semi-employed White Guy's picture

When you are up 700% mid year, even a 75% downturn is no biggie.

This is it's picture

Talk about the implosion now 

Blackfox's picture

It's worth buying a few hundred £/$ on some new bitcoin type launch. just buy them and forget about them for a year. I hear the Jews are launching one call bitcohen (no joke).

I am in for £77 quids worth.

Anopheles's picture

There's a huge problem with all crypto.  Take Bitcoin.  In THEORY it has a market cap of $70 billion. But that's pure fantasy.  The only liquidity in Bitcoin and all other crypto is the money that is injected into the system from people BUYING Bitcoin with hard currency!  There's zero reserves within the system. 

Theexchanges limit withdrawal s because they need to wait until there's enough people that have bought coins with cash to pay out redemptions.

If people begin cashing out in a big way, the entire system collapses, because the cash simply doesn't exist to pay out. That's the Ponzi part.  Call it unfunded liability. There is nothing backing it.

THAT'S why all that wealth is an illusion.  It's the dirty little secret nobody that knows, will admit.

Spaced Out's picture

"Theexchanges limit withdrawal s because they need to wait until there's enough people"

 

Source?

Anopheles's picture

Tell us, where do you think exchanges get their cash to pay out redemptions?  Do you think they print it?  If they borrow, what do they have as assets to back their borrowing?  More Bitcoin?  How do the lenders get their cash back? By selling their coins into a completely illiquid system? that someone else would have to inject more cash?

Think about it.  An exchange isn't the Fed that can just print money. 

That's when the system collapses! You'll see exchanges becoming illiquid. You want to cash out your $10k in coins? No problem, an exchange that becomes illiquid will change their rules, and pay you out over the next year.   If they survive that long.

Mementoil's picture

An "exchange", by definition, doesn't have any money of its own.
The money they pay out is the money they collect from the guy who bought the coin you were trying to sell.
This is no rocket science.

Any such exchange can become illiquid if for some reason there is no bid on the other side.
This is supposed to be solved by the price dropping and new buyers coming into the market to buy the dip.
But if the market is crashing and the buyers are too scared that won't help, and the price can theoretically go to zero.

 

Anopheles's picture

Exactly. This is the point people who claim crypto is an ASSET don't understand.  They somehow believe it's a "fund" from which they can withdraw their money.  They couldn't be more wrong. 

If someone bought Bitcoin at $100, they put that amount of cash into the system. It's now at $5000, yet nobody added that extra $4900 cash.  It doesn't exist. 

Another problem is that every coin mined simply withdraws cash from the system, they put nothing back in. 

Downvotes will come from people who actually believe crypto is a store of wealth... And that there's this magical fund that contains $70 billion in cash. That fund contains exactly zero...

spanish inquisition's picture

We have passed they day when the Tulip bulbs were laboriously brought across the seas at high expense.

We are now at the point where enough have been brought across the seas and there is more money in growing tulip bulbs.

The underlying fraud in marketing and price manipulation is in full swing.

Edit: People made fortunes with tulip bulbs. But they were the ones who realized they were just tulip bulbs.

 

Momentarily Lucid's picture

It's a market and no different to the stock exchange or currency markets.

If you bought Amazon shares at $100 and they have gone up to $5000, where did that extra value come from?

Just like shares you can sell and withdraw your money.

 

Mementoil's picture

You are correct.
The stock market works exactly the same.
Your stocks "are worth" a certain price so long as there is someone on the other side willing to pay that price.

But on the other hand stocks represent a stake in a company which is doing business and hopefully making money, whereas the crypto-currencies represent no such thing. They are based entirely on people's faith that they will continue to appreciate in the future. 

Momentarily Lucid's picture

That is where a lack of knowledge becomes apparent.

The term 'cryptocurrencies' is a misnoma - most of the cryptos are in fact system protocols and answer real world security challenges.

That is why Microsoft, Siemens, Bosch, JP Morgan, Virgin and many many other companies are investing heavily in this area.

Whilst development of these protocols is still in its infancy, there remains little doubt that advanced protocols like Iota will become the norm for machine to machine data transfers in the very near future.

Some people who follow these developments understand that over the next decade the value of some of these protocols will rise exponentially, as they become seemlessly integrated into ordinary peoples lives.

ASIC chips will be incorporated by manufacturers of all connected devices from baby monitors to driverless vehicles in the same way that floating point was adopted in the '80's.

At the moment it is the equivalent of buying Google for penny shares.

It's not for everyone, and requires research into the protocols on offer as some will indeed fall by the wayside.

Squid-puppets a-go-go's picture

I'll take it on faith that you're right - but if Crypto is an asett class people flock to when other assets are falling - when would this 'mass redemption event' be likely to occur?

Anopheles's picture

Mass redemption would only have to be a few percent of outstanding coins to crash the system. Since there's no cash in the system, it's extremely fragile.  That's the Ponzi part of it.  All talk, no cash.

Bentaros's picture

How is that different from a Central Bank imposing capital controls cause the people want to get their fiat ponzi money out? A bank that becomes illiquid will change their rules, and pay out over the next year. If they survive that long.

And guess what! Noone can print more BTC, thus making it exclusive in and of itself, unlike fiat.