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In 2017 and 2018, thousands of entrepreneurs were attempting to launch their own crypto project to capitalize on the bubble-like conditions. Due to the mania, there are now over 5,000 digital assets listed on CoinMarketCap — and there are likely thousands of others that failed to make the cut.
Unsurprisingly, not everyone is convinced that all players in such a saturated market have value. One prominent venture capitalist, in fact, went as far as to say that 99% of crypto projects are simply “garbage.”
Related Reading: DeFi Effect: Scaling Debate Begins as Ethereum Fees Reach Two-Year Highs
Most Crypto Projects Are “Garbage”
Jason Calacanis is a prominent entrepreneur, author, and angel investor. If you’ve heard of him, it’s likely because of his angel investments in Robinhood, Uber, and Trello.
He’s also interested in the crypto space.
In 2019, he was bearish, postulating that Bitcoin could fall to $500. Yet, the investor has recently begun to change his mind, telling Morgan Creek’s Anthony Pompliano that he’s warming up to BTC.
Calacanis’ thoughts on altcoins, however, have not changed. In a tweet published June 27th, he wrote:
“Historically, 99% of crypto projects are garbage run by unqualified idiots, delusional but below average founders or grifters… the 1% that are not, could change the world. I’m waiting for that 1% to deliver their product so I can talk to their customers.”
Historically, 99% of crypto projects are garbage run by unqualified idiots, delusional but below average founders or grifters… the 1% that are not, could change the world.
I’m waiting for that 1% to deliver their product so I can talk to their customers.
you got customers?
— @jason (@Jason) June 27, 2020
This is a sentiment that has been echoed by Kevin Rose. Rose is a co-founder of Digg and a general partner of True Ventures.
On altcoins, he told TechCrunch in a recent interview:
“The problem is that 99% of the projects out there and a lot of the people who are behind them are just in this for the pure financial gain. And there’s a lot of garbage out there. And that’s unfortunate because it really drags down the high-quality projects, and it muddies the space quite a bit.”
A similar thought has been echoed by stock trader and analyst Steve Burns, who said that “99.9% of altcoins are going to $0 [… over a] buy and hold timeframe.”
Related Reading: Crypto Tidbits: Bitcoin At $9k, Grayscale Ethereum Trust, Cryptocurrency & PayPal
They’re Rallying Anyway
While altcoins may be fundamentally worthless, they have rallied over recent months anyway. Many, in fact, have actually outperformed Bitcoin.
A data analyst in the space shared the chart below earlier this month. It shows the price performance of Bitcoin since the start of the year in relation to that of altcoins.
As of the chart’s publishing on June 7th:
- Bitcoin was up 33% since the start of the year.
- FTX’s small-cap altcoin index is up 80% since the start of the year
- FTX’s mid-cap altcoin index is up 60% since the start of the year.
- FTX’s large-cap altcoin index is up 38% since the start of the year.
Bitcoin vs. low cap, mid cap, and large cap altcoins chart shared by cryptocurrency trader Ceteris Paribus (@Ceterispar1bus on Twitter). Chart from TradingView.com
Featured Image from Shutterstock Prominent VC Says 99% of Crypto Projects Are "Garbage"
