Connect with us
Active Currencies 13980
Market Cap $2,470,610,305,816.55
Bitcoin Share 51.74%
24h Market Cap Change $5.73

Why 2021 should be about more than just Bitcoin, Ethereum

3min Read

Share this article

Bitcoin isn’t the only cryptocurrency in the market’s good books right now. In fact, Ethereum is bullish too, with the world’s largest altcoin going past $1,300 on the charts weeks after plans for ETH 2.0 went underway.

Look beyond the two

What about the rest of the market though? Well, you have your Bitcoin, and you have your Ethereum, but mainstream coverage will have you believe that the cryptocurrency market begins and ends with these two.

Yes, the crypto-market is rallying to heights never seen before. Yes, institutional participation is at an all-time high. And yes, thanks to political and economic uncertainties, Bitcoin’s credibility as a hedge has only shot higher. But that does not mean there’s nothing else to the market.

Don’t believe me when I say that’s how it looks? Check out how diverse most analysts’ predictions are for the year 2021. Hint: They really aren’t.

The point here is that it’s time to look at some of the lesser-known narratives and themes that will play out in 2021. Narratives not associated with yet another Bitcoin ATH or Ethereum 2.0, but with the oft-ignored part of the crypto-market.

Community-driven growth

Now, while using the expression ‘oft-ignored’ might seem like a stretch, the fact of the matter is the rest of the market is seeing some remarkable developments, none of which are getting the plaudits they deserve. The space’s efforts towards greater decentralization and democratization and transparent governance is a case in point.

Consider this example – How would you compare LINK, SUSHI, YFI, and SNX with the likes of COMP, ATOM, UNI, and FIL? Well, one set, the first set, has outperformed the other quite significantly. Why so? Well, according to Arca’s Jeff Dorman, this has been the case because more often than not, “tokens with the strongest communities derive the most value.”

That’s the keyword here – “Communities.” As the Arca exec pointed out, when tokens are only available to the public after VCs have already generated 10x – 100x gains, token holders don’t feel empowered. The growth of such community tokens is one of the success stories of the past few months. And ideally, it should be front and center of the larger market’s success story too.

Governance – Back in vogue?

Then, there’s the question of Governance tokens. As Dorman highlighted, for a long time, these tokens enjoyed a “negative connotation” because of low voter participation, which in itself was a consequence of there being nothing worthwhile to govern.

Fast-forward to 2020, however, and the likes of Uniswap have taken the market by storm, especially on the back of some serious revenue generation (In fact, “over $400 million in annual revenue generated by Uniswap is up for grabs when a fee switch vote comes to the table in March 2021). Not just that, but projects such as Uniswap are trying to ensure that a degree of democratization and transparency find their way into the market.

That is just the next step in the evolution of a digital token, one that says that governance equals equity. That is a big step, one that deserves plaudits as much as Bitcoin or Ethereum.

Conclusion

On the question of equity, it’s also worth noting that 2021 will most likely see companies on Wall Street issuing their own digital assets, turning “product owners into quasi-equity tokens” and ensuring that financial gains flow directly to the users of a platform or a company.

There is, therefore, a good reason to believe that 2021 will be about more than just Bitcoin or Ethereum. Believing otherwise, in fact, runs the risk of fueling a top-heavy market, one that might always be susceptible to collapse. It would serve the community best if that doesn’t emerge as the case, especially since that is a criticism it has often leveled at the mainstream financial ecosystem.

Share

Jibin Mathew George is Editor-in-Chief at AMBCrypto. A domain expert in International Relations (European Politics), he has always been a believer in the unlimited possibilities afforded by blockchain and by extension, cryptocurrencies. As someone who has been watching and writing about this space for over 5 years now, Jibin has closely tracked the emergence of cryptos and digital assets as a separate asset class in portfolios world over. A lawyer by training, he previously contributed to the News and Research desk of Diplomacy & Beyond Plus. Before his stint at D&B, he was Editor at ED Times. Jibin also takes a great interest in politics, especially the corresponding effect political decisions and fiscal policy have on the world of finance, with a special focus on cryptocurrencies.
Read the best crypto stories of the day in less than 5 minutes
Subscribe to get it daily in your inbox.
Please check the format of your first name and/or email address.

Thank you for subscribing to Unhashed.