Breaking Altcoins Aren’t Dead; Long Live Altcoins

Bitcoin won’t win as a monetary asset while tokens power adoption through incentive layers. Zero-knowledge transport layer security unlocks verifiable data portability.

Opinion by: Kamal Mokeddem, General Partner at Finality Capital

The prevailing institutional narrative surrounding altcoins is as follows: If you want crypto exposure, simply buy Bitcoin and move on.

Bitcoin now has ETFs and has outperformed nearly every other digital asset. Unlike 2017 or 2021, there has been no broad altcoin rally this cycle. At its peak in 2021, more than 2.6 million tokens were live; today, there are more than 42 million. No wonder many people believe the game is over.

This perspective is lazy and wrong. The absence of an “altcoin season” doesn’t mean there is a lack of opportunity. It means the market is maturing.

The free-for-all token rallies of 2017 and 2021 are behind us — oversupply, poor tokenomics and retail fatigue made sure of that. Confusing the end of indiscriminate speculation with the demise of altcoins is to miss the real story. These tokens are no longer trying to compete as a currency. Instead, they’re evolving into one of the most powerful growth marketing tools we’ve ever seen.

Bitcoin will not win as the preferred monetary asset. All tokens have some non-zero monetary premium. The one most likely to gain the most significant monetary premium is the one that’s used the most as a means of payment, which is expected to be the native token that hosts the most popular Web3 applications. It’s still too early to say whether this will be Ether, SOL, or something else, but it almost certainly will not be Bitcoin.

Altcoins are shifting from speculative chips to fundamental business primitives. They’re not about replacing Bitcoin. They’re about accelerating adoption, pulling users out of Web2 silos and bootstrapping new networks faster and cheaper than any company in history.

The consequences of such an adoption will change the internet as we know it. The value of Web2 companies depends on their ability to hoard and monetize data. Once that data becomes portable, verifiable and user-controlled, the moat that sustained these monopolies starts to erode.

Over the next five years, we should expect the first year-over-year revenue declines at the Web2 giants. Google and Facebook, whose margins depend on data lock-in, are the most at risk. Apple, meanwhile, benefits regardless — whether apps are Web2 or Web3, they still run on iPhones. Amazon’s logistics moa

Source: CoinTelegraph