A reckoning coming to the cryptocurrency markets, an “extinction-level event” that’s poised to wipe out 90 percent of the more than 1,800 coins and tokens that aren’t named bitcoin.
That’s the prognostication of Xapo President Ted Rogers, anyway, who said that the impending altcoin bloodbath will provide discerning investors with an incredible opportunity to load up on bitcoin at a discount.
“We could be in the midst of the extinction-level event for “cryptoassets” that many maximalists have predicted. 90%+ of @CoinMarketCap list will disappear eventually – might as well happen now,” Rogers wrote on Twitter. “Meantime, lower BTC price means incredible opportunity to buy more #bitcoin.”
Rogers’ pessimistic altcoin forecast comes at a time when virtually every major cryptocurrency, bitcoin excluded, has declined at least 80 percent from its all-time high, which most altcoins hit in early January.
Indeed, as of the time of writing, seven of the 15 largest cryptocurrencies have plunged more than 90 percent from their peaks: ripple, cardano, IOTA, tron, dash, NEO, and NEM. Five others — ethereum, bitcoin cash, EOS, litecoin, and monero — have experienced declines in excess of 80 percent. This leaves just three — bitcoin, stellar, ethereum classic — that have declined less than 80 percent, though bitcoin has nevertheless seen a 70 percent sell-off, and XLM and ETC are both quickly approaching the 80 percent threshold as well.
The altcoin massacre has become so pronounced this week that bitcoin dominance — the share of the total cryptocurrency market cap that belongs to BTC — has not only crossed 50 percent for the first time in 2018 but also soared to 54.3 percent — its highest mark since Dec. 18, the day after the bitcoin price peaked at its all-time high (OnChainFX has bitcoin dominance listed at 57.3 percent).
As CCN.com reported, there are some indications that the altcoin sell-off, spurred by largely by ethereum, has come as blockchain startups funded through initial coin offerings (ICOs) have reached the point in the bear market where they risk cannibalizing whatever remains of their runway if it continues for much longer.
Since an increasing number of analysts believe that will be the case, some ICO operators may have begun liquidating their holdings, which are largely denominated in ETH. This can create a bit of a vicious cycle, as more and more startups capitulate and sell.
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Last modified: March 4, 2021 3:55 PM