Bitcoin has pulled back from recent highs, but it continues to lead crypto markets. Altcoins continue to struggle.
Bitcoin’s “market dominance” is currently at 65%. That means bitcoin makes up 65% of the entire cryptocurrency market. Back in early February 2018, altcoins made up 68% of the market and bitcoin just 32%! It’s a shocking turnaround.
Unfortunately, I expect bitcoin will continue to outperform altcoins for the near future. I know you signed up for an altcoin service, but I’m simply calling this market like I see it. Bitcoin’s momentum is so strong that it could continue to suck all the air out of the room for a bit longer.
Of course, altcoins could break out at any time, and we’re watching for such a move closely. But we haven’t seen it yet.
However, we did get some good news for altcoins this week. Blockstack, a prominent cryptocurrency project, announced that it received approval from the SEC to offer tokens to the general public through a legal ICO (initial coin offering) using “Regulation A+.”
Blockstack is approved to sell up to $28 million worth of its own STX tokens. But I am not recommending this deal. There are a few problems with the offering. Here’s the biggest, as reported by Forbes (emphasis mine):
The stakes for Blockstack are high in more ways than one. First, without users the network will likely atrophy. Second, if the company does not obtain 1 million verified users by Jan 30, 2020 (6 months from now), it will have to return millions of dollars in capital back to its investors and suffer reputational damage regardless of how the public offering goes.
The investors who negotiated the Blockstack deal must have put that clause in the contract. It’s smart, because unless Blockstack gets serious traction, investors stand to get much of their money back.
So we’re going to pass on the Blockstack deal. But this is a good sign for the industry. If SEC-registered ICOs catch on, we could be presented with some excellent opportunities in the near future.
Have a great weekend, everyone.
Adam