Alternatives to bitcoin on the rise :

The dematerialized currencies alternatives to bitcoin are experiencing an unprecedented rise in their value. So much so that investors are comparing with the internet bubble.
They are called ethereum, ripple, monero or litecoin. These alternatives or competitors to bitcoin are still less known to the general public than the mother of all dematerialized currencies, but they have just experienced a spring of all success.

Between early March and mid-May, the value on the exchange markets of some 840 altcoins (alternative digital assets to bitcoin) grew by nearly 700%. Their capitalization has increased from $ 3 billion to $ 23.5 billion, the site coinmarketcap found.


Japan recognizes bitcoin

A flight that is as brutal as spectacular that has upset the order of things in the realm of cryptocurrency (another denomination of the dematerialized currencies). For the first time in his young history (just under 10 years of age), bitcoin is no longer the absolute monarch. Its market share has increased from around 95% to less than 60%.

The craze for digital assets like omni or waves - whose total values ​​increased from $ 1.7 million to $ 38.6 million and from $ 19 million to $ 300 million, respectively - are is not made at the expense of the good "old" bitcoin. "It's going very well: its capitalization has increased sixfold in one year," said Jacob Eliosoff, the manager of a US investment fund specializing in cryptocurrencies, contacted by France 24.

The digital gold rush benefits everyone. The kickoff to this frenzy would have been the "Japanese decision to recognize bitcoin as a legal means of payment [April 2, 2017]," says Alfonso Lopez de Castro, director of the Financia business school and bitcoin specialist, contacted by France 24. Interest in dematerialized currencies then increased tenfold. "The success of bitcoin has been that of altcoins because investors have decided to spread risk by diversifying their portfolio," summarizes the expert.

According to the precept not to put all his eggs, digital or not, in the same basket, investors began to be interested in everything that looked like bitcoin. Opportunists jumped on this opportunity to make "coins" (called tokens) altcoins hoping they would gain value.

These currencies are fighting in a particular way. Most cryptocurrencies "mine" (fabricate) by solving mathematical calculations more and more complex, requiring to allocate an ever greater computing power. Making new bitcoins is no longer within the reach of the first comer. "It takes at least 20,000 euros of computer equipment and an extra 50,000 euros a year in electricity," says Alfonso Lopez de Castro. The new "miners" favored more accessible alternatives such as Ethereum or Zcash.

 35 million $ in less than 30 seconds

But the Japanese decision does not explain everything. "There is a lot of factors at work," says Edwige Morency, director of Eureka, a training and consulting organization specializing in cryptocurrencies, contacted by France 24. He cites, pell-mell, the arrival investment funds willing to bet much larger sums that drive up prices, developments in bitcoin technology or speculators who missed the first wave of craze for bitcoin.

In parallel, another phenomenon that contributes to the rise in prices is gaining momentum: that of the ICO (Initial Coin Offering). "These are often start-ups raising funds by launching altcoins or using existing ones," said US investor Jacob Eliosoff, schematically a model for crowdfunding in the world. The universe of altcoins Instead of knocking on the traditional door of venture capitalists or business angels, project developers ask Internet users to finance them in exchange for participation in an altcoin.The American billionaire Tim Draper has become On May 15, the first internationally renowned investor to announce that he was going to participate in one of his ICOs, his decision offered an unprecedented advertisement for this alternative way of raising funds. "Brendan Eich, the former boss of Mozilla (the creator of Firefox browser), managed to raise $ 35 million in less than 30 seconds for its new start-up, June 1.

Bubble always, you interest me

Investors who jump on the slightest altcoin, a multiplication of new projects, valuations that raise the ceiling: the excitement of the sector is not unlike that of the Internet at the turn of the 21st century. The financial explosion of altcoins is out of proportion to the progress - quite real - of their uses. "The parallel with the Internet bubble of the 2000s is undeniable," recognizes Jacob Eliosoff.

Like start-up companies, who were selling wind, relying on investors' thirst for everything that ended in .com, "it's a little bit big for a number of alternative digital assets to bitcoin. ", Recognizes Edwige Morency. Between pure and simple scams and currencies that bring, technologically, nothing more, Jacob Eliosoff judges that there are "too many altcoins, and only five or ten of them are serious".

The rest may be costly, according to Edwige Morency, of a "Darwinian selection" when speculative fever.
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