Nick Tomaino, who is the head of a crypto VC firm 1confirmation, has warned investors against buying what he calls “meme-based currencies,” reports Yahoo Finance.
“There are currently 19 cryptocurrencies with market value above $1 billion, but unless you’re deeply steeped in the crypto space, you’ve likely only heard of the top four at most: Bitcoin (BTC), ether (ETH), ripple (XRP), and bitcoin cash (BCH),” says Yahoo Finance.
But how does one understand which of them are worthy? This is where Tomaino, who spoke at Yahoo Finance’s All Markets Summit: Crypto, explains which cryptocurrencies should be avoided: “How I describe most of these coins is they are meme-based currencies. In the past year, there’s been so much interest and fervor in this space that if you create a coin and have a good meme, you could have a billion dollars in market value.”
The article goes on criticizing EOS, saying that even though it has been launched recently, it is already experiencing troubles. And if you take a quick look at the coins available on the market you will see that many are indeed problematic even when it comes to their purpose with the No. 9 coin Tron (TRX), for example, aiming “to be a blockchain for the entertainment industry.”
But the lower you scroll, the crazier things get. There is a Dogecoin, named after the popular Shiba Inu meme, a Dentacoin which should be used for dental purposes, and, of course, the infamous Trumpcoin.
Tomaino believes that these types of coins spell neither trouble nor prosperity. In the short-term the problem is that “a lot of people are probably going to lose a lot of money,” he says. And some people, indeed, lost money. Think scams like Bitconnect and Titanium Blockchain created by Michael Stollery, a.k.a Michael Stollaire.
He then adds that in the long run this might turn out to be not so bad news after all, “Because for every person that just cares about getting rich quick, there’s also a person that becomes more deeply interested in the technology. And that’s going to help the space in the long run.”
Undoubtedly, there has been a lot of hype following the market price surge at the end of 2017 with Bitcoin price reaching $20 000 and Yahoo Finance points out that Bitcoin and blockchain entrepreneurs “are now hoping that interest will remain—beyond mere price speculation.”
Dan Held, who previously owned a ZeroBlock app, agrees that the incredible price surge has sparked mainstream interest saying that before that the crypto market was “very hobbyist and very niche.” He adds that he is excited to see what happens to the market which he believes will remain to be volatile.