As early as the "crazy season" of the cryptocurrency circle in 2017, countless so-called "shitcoins" emerged rapidly, trying to imitate the practices of successful projects such as Bitcoin and Ethereum, and taking the opportunity to raise funds. But in essence, most of the shitcoins lack both innovative ideas and viable business models, and rely solely on marketing hype to attract investors, which are typical air coin projects.
Therefore, I think that investors should take a short-selling view on these meaningless altcoin projects. Not only should they not buy them, but they should take the opportunity to sell off their holdings. The reasons are as follows:
First of all, most of the altcoin projects are purely short-term marketing gimmicks and have no foundation or motivation for long-term development. They often do not have unique blockchain technology innovations, rely on imitation and replication rather than independent research and development to quickly go online, and have no sustainable profit model, making it difficult to truly bring value to users or industries. Sooner or later, the rootless altcoins will be ruthlessly abandoned by the market.
Secondly, altcoins that lack core technologies and products cannot stand out in the fierce competition of homogeneity. The cryptocurrency field has seen explosive growth, with hundreds of projects in each segment repeating speculation, but few outstanding works appear. In the fierce competition of homogeneity, altcoins will inevitably be eliminated by the market.
Furthermore, there are often extremely opaque and non-compliant operations behind the altcoin projects, and the lack of an open and transparent fund operation mechanism makes it easy for illegal activities such as banker manipulation and insider trading to occur, bringing great financial risks to investors. From a regulatory perspective, such altcoin projects will also face a high risk of being cleared by regulators.
In addition, in order to realize the dream of "getting rich quickly", a large number of altcoin projects often use uncontrolled token issuance and air-gaming operations, which is not only not conducive to maintaining the long-term continuous increase in the value of the currency, but will cause the token price to plummet in the short term. This kind of altcoin driven by value speculation and without intrinsic value support is destined to be worthless in the long run.
Moreover, many teams behind altcoins have serious problems such as capital outflow, internal friction, and failure to keep promises, which will increase the risk of project failure. Once the capital chain of altcoin projects is broken or they fall into internal strife, the token price will plummet.
Most importantly, compared to mainstream Bitcoin and Ethereum projects that have mature and stable community ecosystems, altcoins are mostly driven by marketing accounts and hype, and the actual number of holders is not large, not to mention the lack of an active community. Once the heat fades, altcoins will fall into a dilemma of extreme lack of liquidity, which will directly lead to stagnation of the blockchain network.
From a prospective perspective, if you want to seek truly valuable cryptocurrency investments, you should undoubtedly focus on mainstream projects such as Bitcoin and Ethereum. They have mature community ecosystems, constantly innovative technologies, formal and transparent governance models, and sustainable profit models, which are worlds apart from altcoin projects.
In short, most altcoin projects driven by pure marketing gimmicks are destined to be short-lived market bubbles. They lack fundamental support, technical strength, community ecology and sustainable profitability, and will sooner or later be ruthlessly abandoned by the market.