What I have learnt from 1st month in crypto

Point 0: TAKE MORE HEED OF ASIAN NEWS THAN WESTERN...ITS THERE BABY AFTER ALL!!

Let’s divide all cryptocurrencies into three categories: 1st tier currencies have good developer support + good community support + good institutional support + good media support. 2nd tier currencies have good developer + good community support. 3rd tier currencies have nothing.

People don’t come to the cryptocurrency market for a certain currency. They search for a currency to use and invest. Remember the Pareto rule that 80% of the market is held by a few strong actors. In altcoins case, it would be first tier currencies, like bitcoin, ethereum and ripple, and may be several other currencies. So as the interest of the general public to cryptocurrencies grows, the market cap of all cryptocurrencies grows and the second tier currencies will get their 20% share of it. So assuming there are 50-100 second tier cryptocurrencies (with an active community, active developers, good consumer value) and taking into account the number of coins of a currency, we can easily evaluate the “natural” interval of prices for this coin.

Let’s consider the current market with its capitalization of $100 billion dollars. We see that the three biggest players (bitcoin, ethereum and ripple), far exceeding other currencies, hold about 80% of the market. Taking into account the remaining share of the capitalization and the number of the coins, the “average” price for a currency in tier 2 would be higher than its current price by quite a bit. For the capitalization of $1 trillion 50-100 cryptocurrencies of the second tier will have about $200 billion of the cap. About $2-4 billion per each. This could mean 10x the current value for tier 2 alt coins.

Some conclusions:

There is nothing special or overhyped in the current prices. The levels of support tell a lot in good tier 2 currencies.

If the total cryptocurrency market will grow and reach at least $1 trillion of capitalization (which is a quite feasible target in the near future), an increase will be absolutely natural in tier 2.

Most good alt coins, you and I, bank on doing well are currently a second-tier currency de facto, but this place is not granted for ever. To just stay in this group both active community support and efforts from developers are required.

If alt coins will gain sufficient institutional + media support, and enter the first tier of cryptocurrencies, the price can be 50X or more, even if it remains in the second tier category, the growth of the total market to several trillion can easily transfer to the worth of your alt coin pick.
So for alt coin fans, let’s support and promote our own coins community, and let’s hope the developers will continue their great work, and we will see great future for the coins.