The Bull Case

An altcoin is either a literal copy & paste of Bitcoin's code base with altered parameters or a coin with a new experimental code base. In both cases, the common sales pitch is that they claim to be "better" than Bitcoin in some way. Unfortunately, 99.99% of altcoins are heavily flawed (broken) or a scam. Their main usecase is gambling and like a casino; a few might win and the rest lose.

"Better" is usually a claim to being "faster" than Bitcoin. However, this very attribute of "instant transactions" completely nullifies the only important usecase of a blockchain: digital immutability.

To achieve "fast" on a blockchain, you must sacrafice decentralization and if it isn't decentralized, it isn't immutable or secure and the blockchain becomes just another paypal like system but much less effecient and secure. And if it's just another paypal like system, there is nothing special about it. Every direction you move towards in a coin's design has a trade-off and sacrifices something. There is no such thing as magically adding an attribute that does not have a consequence in the general function of the coin.

Let's try to keep it real, when you buy an altcoin you are gambling. You see tens or sometimes hundreds of random altcoins listed on an exchange. You don't know what any of them do, how any of them are different from one another, who was given a very large stake of coins for free, how many coins will ever exist, etc. If you are one of the few that does research an altcoin, all you will find are other people that pretend to know what they're talking about and you're probably not technical enough to truley understand anyways.

If you bought an altcoin it's because you saw a cheap price and wanted to test your luck.

For 99.99% of altcoins, you are competing (if you want to call it that) against insiders. Almost every single altcoin in existence today has had a very, very large pre-mine. This means some user(s) and/or group(s) have a significant portion of the token supply that they allocated to themselves for free. These user(s) or group(s) usually include but are not limited to: creators, friends, partners, paid groups, paid users, celebrities, influencers, etc.

Not only are you competing against insiders but you are competing with every other user that bought the altcoin. 99.9% of the people buying an altcoin have the same mentality as you; you want to make money and a lot of it - quickly. How do you think that plays out in the end?

In addition to competing against other buyers and insiders, you are also competing against previous and future altcoins. There are over +15000 altcoins now and the list is growing rapidly. Not only is there an endless list of altcoins but each previous altcoin must compete with not only current altcoins but future altcoins that are "better". It created a game of hot potatoe.

This "competition" isn't new and we'ver seen this before with the internet. Centralized protocols versus the decentralized protocol.

Most altcoins are akin to our current fiat system and when you buy one, that is what you are supporting whether intentional or not.

I say this because:

• there's an unlimited number of altcoins
• it's almost free to create an altcoin (copy+paste someone elses code)
• most altcoins have huge token supplies because it's easier to manipulate market caps
• many altcoins continue to print more tokens out of thin air; either out of greed or necessity because of how their network security operates
• these altcoins are centralized and controlled which means their consensus rules and monetary rules will and do get changed by the few.

What do these characteristics remind you of from today? Yeah, that's right 😉

Everyone and their mother can create altcoins now and it's only getting easier.

Bitcoin is open source which means that anyone can copy and alter the code to create their own coin - enter the altcoins, a.k.a. shitcoins. Altcoins are mostly all scams with a few experiments. There's now thousands of altcoins and 99.5% of them have no utility except for an attempt to make someone a quick buck. Experimentation is great but pre-allocating a ton of the coins to you and your buddies and pumping your bags strictly for profit when your experiment has absolutely no use-case, security, decentralization, network effect, competent developers and is destined to fail is not only disgraceful but rampant in this space now. If it is an experiment, it should be treated like an experiment - the goal is to change the world. If it is something truly remarkable it will sell itself and catch on organically.

Many altcoin proponents spend their time preaching to others on how their altcoin is the next Bitcoin - "it is faster, cheaper and it can do everything imaginable!" Most people are not informed about the limitations or purpose of a blockchain. Fast payments to buy coffee aren't new or special. In fact, a blockchain isn't designed for that and because of how it works, it actually destroys the security model and purpose of a blockchain: digital immutability. It just becomes a useless, boring and ineffcient payment system. The main ingredient that makes a blockchain special is decentralization and using a blockchain for coffee payments removes this.

Tons of altcoin teams out there build a cookie-cutter website, build up a small cult with puppets, pay off some pundits, spend some money on an advertising team and voila you have the next Bitcoin! In addition, they all have a small central team of developers and a leader of the project.

The "next Bitcoin" motto has been around for over a decade now. Unfortunately, some new people fall for it all the time and get burned. The loud-mouth scammers or bag holders pretend to believe it and can sound convincing. But they are just pumping their own bags. Once you have been around these altcoin proponents for long enough, you begin to realize they are all the same and it will most likely continue for a while longer (maybe forever but to lesser effect). They are feeding off of the uneducated and the greedy. One day you should be able to spot these people and altcoins quite easily.

Altcoins have been around in every bull market cycle. Each new bull market cycle has more new shitcoins than the previous bull market and the top 10 (nevermind the top 100) altcoins from the last bull market are no longer the top 10 or top 100 of the next bull market. It's a very fast game of musical chairs.

The last round of altcoins have to compete with the "new and improved" altcoins of tomorrow. We are already seeing this process take place as the 2017 bull market unwinds. Focusing on the top 10 altcoins, they are all flip-flopping and swapping their lead spots in the top 10. Most trend towards $0 over time and every altcoin loses their value in terms of bitcoin. Remember, when Bitcoin's price corrects after a bull market, you can bet the altcoins are going to crash much harder and are not guaranteed to come back. If Bitcoin goes to $0, everything is going to $0. Most altcoins from previous years you probably haven't heard of because they are completely irrelevant now.

As time went by and altcoin after altcoin piled in - we have learned that market caps are a very poor method of calculating a coin's dominance in the overall ecosystem because it's an endless sea of useless altcoins constantly being added. Many of the altcoins have a token supply in the hundreds of millions or billions. We don't even know what the supply cap of some of the top altcoins are! With these large token supplies, the project just needs to sell 1 token for $1 and if the altcoin has 10 billion tokens, it now has a market cap of $10 billion dollars. In addition, most websites are mixing in Bitcoin with things that aren't even cryptocurrencies to determine their numbers, further invalidating the metric. These issues have rendered the coin dominance metric pretty much useless now.

Many of the altcoins had a pre-mine with a set allocation of coins for founders, developers, etc. Sometimes there are even covert pre-mines that break the supposed hard limit cap of the project (for example: bitcoin private). Some other projects have weird time locks on a large amount of the token supply or a pre-sale before the project is public.

World class developers, protocol specialists, top cryptographers, cypherpunks and pioneers (some of who aided in the creation of the internet) have and continue to think of every aspect of Bitcoin over and over again - attack vectors, trade-offs, scaling, supplemental technologies, privacy, game theory, fungibility, etc.

A passenger of an airplane should not tell the pilot or engineer how to fly or build an airplane. Protocol engineering is no different. Everything that Bitcoin does, it does for a very important and technical reason. Bitcoin takes a slow and "do not break things" attitude for protocol changes - the utmost importance for a protocol dealing with money. Having gone through all that - if Bitcoin needs to implement a secure, innovative, thoroughly tested code from an altcoin it can be integrated. Bitcoin is code. It is adaptable. Bitcoin is the next Bitcoin. The media has claimed Bitcoin is dead over 300 times now - yet it's still here and thriving. Attacks on Bitcoin only make it more resilient. There's a reason why Bitcoin is called anti-fragile. So be warned, dabble in altcoins at your own risk. Some people need to touch the stove and get burned to learn.

The playlist identified with the request's playlistId parameter cannot be found.

• extremely illiquid
• Manipulated and fake market cap valuations
• High token amounts (some are in the tens of billions)
• infinite, unknown or broken token supply limit
• Centralized network, has a leader and a marketing team
• Designed under a false narrative like fast payments or decentralized world computer
• Insecure in more ways than one
• Each altcoin risks being replaced by the so called "next Bitcoin" in a few months
• High pre-mined allocation of tokens
• Pump and dumps
• Incompetent developers, little to no developers and/or disloyal developers
• Buggy code
• Experimental
• Absolutely no use case
• Alts trend toward $0 in the long term
• All altcoins lose their value in terms of bitcoin return relatively quick and permanently
• Developers / pundits misunderstand or intentionally ignore the limitations and purpose of a blockchain
• They're all just penny stocks
• Easy for big holders to game the market in their favor because it is so illiquid and large quantities of coins were pre-allocated for free
• In the past decade, the top 50 altcoins have come, gone and swapped spots
• "The next Bitcoin" motto has been around for over a decade
• 99% of traders lose in the traditional markets, 99.9% of traders lose in this space.
• If you day trade (buy, sell, then re-buy), you most likely just created a taxable event.
• very short period of time to act on price moves
• an altcoin can literally lose all value in less than 1 hour
• Altcoins have a "move fast and break things" methodology which is counter-intuitive to being used as a system where reliability is the utmost importance.
• Bitcoin is not the first attempt to make a better money or solve digital immutability. Many attempts failed in the past, all mostly from being centralized. In other words, Bitcoin is not "MySpace".
• Buying altcoins isn't diversifying and it doesn't make sense. Altcoin prices are correlated with Bitcoin and are amplified when Bitcoin's price goes down. Also, diversifying is for someone that doesn't understand the space.
• People buying altcoins aren't looking to add them as a long term asset in their portfolio. They are looking for short term gains in their currency and will eventually dump them all.
• There are thousands and thousands of altcoins now. A service can list an endless wave of altcoins. When does this stop? Altcoins die all the time and exchanges have to remove and replace altcoins all the time.
• Each altcoin added to a service requires the company to run the node of each coin in their backend plus additional code. This requires additional company resources. In addition, each coin needs to be individually maintained and checked for security vulnerabilities, fork events, etc.
• Just adding 1 altcoin to a service increases the attack surface of the service's code. Now imagine adding 10 or a hundred altcoins. Altcoins are a security risk to you and the company.
• An honest and organic start like Bitcoin is near impossible for altcoins now. People know too much and will game every aspect of the altcoin. The proof is in the thousands and thousands of altcoins that have already been exploited out of greed.