An American blockchain expert talks about the present and the future of the altcoins. Will they be able to compete with fiat money? How long will they be kept afloat? Read an interview and find out.
With the development of cryptoeconomy, will the number of altcoins decrease or increase?
In my opinion, the number of altcoins will decrease in the future. The use cases of many coins will overlap and those that supply the best technology, support, and execution will ramp the fastest.
Cryptocurrencies are a means of investment mainly, and as their rates still grow, people buy them to multiply their savings. However, the conceptual meaning of cryptocurrency is a means of payment. But what can happen in future?
As the adoption of cryptocurrencies increases there is an opportunity for cryptocurrency transactions to become more commonplace as a means of payment. One thing to keep in mind is that cryptocurrencies provide technological functionality in addition to being a means of payment. For example, there are certain cryptocurrencies that can perform a on-monetary function or transfer of value beyond just monetary payment transactions. For example a “smart contract” can make a payment based on certain conditions, and some of the latest Artificial Intelligence platforms such as Thought Network, actually use blockchain to compute data analytics and machine learning algorithms.
Will cryptocurrencies be able to compete with fiat money in future? Or will they occupy their niche? Or maybe, they will cease to exist in a few years?
Cryptocurrencies will coexist with fiat money and will continue to be the next generation of “money” in today’s highly digital world. The innovation that cryptocurrencies bring is that they are not simply a single-dimensional transfer or an IOU, but they provide functionality in addition to transactions. This functionality is required to manage complex value transfers as the world braces for the technological explosion that will happen over the coming decades. The interest and investment in blockchain and cryptocurrency related technologies has greatly increased over the past year with almost all major companies announcing some for of involvement ranging from research to adoption. I expect that trend to accelerate in the coming years.
In case of its decrease, which altcoins will remain? Which altcoins will exit the market?
It’s too early to tell. We’re just in the infancy of crypto and many of the coins with huge market caps today won’t be around 1-2 years from now. In the same regard, coins we never heard of may be a default payment option.
What determines the success and failure of the altcoin: PR project, the success of technology on the market or something else?
Success of an altcoin is determined by many different forces:
- depth and relevance of the technology
- general market forces and competition by larger non-blockchain companies
- level of funding
- and certainly awareness and PR are a big contributor.
In addition to the above, the altcoin has to create value for it’s users and have a unique value proposition. For example a lot of altcoins simply take an existing cryptocurrency, make some minor change and release their new version with incremental value increase. A truly novel altcoin or cryptocurrency is based on some new premise that will solve some difficult problem that will eventually give back significantly to its users and the community.
What does determine the cost of altcoins? What is the reason that some altcoins cost 2-3 dollars and the others just a few cents?
It is a combination of market demand, total number of coins in circulation, and coin price. Just because a coin trades at $3 does not mean it’s worth more then a coin priced at $0.30.
The market cap is the ultimate factor to determine overall value. However, I would go one step further to say that real world application (not just speculation) is a more important factor.
Will there come a time when cryptocurrencies become a means of payment and not just a means of funds generating?
Yes. For Ternio, it will be June 2018 when we enter a live transaction environment. We are providing a scalable blockchain solution for the programmatic digital advertising industry. Blockchain is the ideal solution to bring transparency to the digital ad buying process.
Under which circumstances cryptocurrencies can become a means of payment besides of their recognition at the legislative level?
They already are a means of payment on websites like Overstock and Tesla. I think digital goods (advertising, ecommerce, etc.) will see the quickest adoption, followed thereafter by brick and mortar locations. Ultimately, there needs to be much more user adoption before traditional businesses will feel confident in accepting crypto as a means of currency that is on par with FIAT.
Questions by Emilia ROMAGNA
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