Why are there so many cryptocurrencies?

why are there so many cryptocurrencies

Why are there so many cryptocurrencies you might ask? If I have to be honest, I believe it all comes down to money. People, developers, businesses, entrepreneurs etc. want to make money so they launch their idea on the blockchain.

Coin Market Cap currently lists over 2000 cryptocurrencies, 2097 to be exact.

Besides the making money part, there are a few more reasons that come to mind and that I discovered while doing research.

Different types of crypto & industries

The thing about blockchain technology is that it can be modified to be used in many different scenarios and industries. That’s why there are currently multiple types of cryptocurrencies that exist.

Here are some examples:

  • Crypto to be used as a currency such as Bitcoin or Litecoin. Although Bitcoin is seen more as a store of value.
  • Crypto to be used on platforms such as lending platforms (SALT), exchanges (Binance), social networks (Steem).
  • Then there’s the stable coin niche, security tokens and many more.

Industries blockchain is currently being used in, being tested in or attempting to disrupt include finance & banking (Ripple), travel, automotive, lending, social networks, internet of things and much more.

Here are 42 big industries the experts believe blockchain can be used in.

Innovation & new technologies

Another big reason that so many cryptocurrencies exist is innovation. The crypto and blockchain industry is still very young and full of room for improvement. There are also tons of bugs, issues, and problems that need solving. Many bright minds are coming up with solutions to old problems and even solving new ones through blockchain.

One developer might find a weakness in one cryptocurrency and decide to copy it and launch his improved version. It’s happened before and it’s usually called a fork, although it’s a very simple explanation.

Adoption with blockchain technology is still very low given the fact that it’s a technology that can surpass borders and be used worldwide.

The ICO & blockchain boom of 2017

In 2017 any crypto millionaires were born through BTC and prices of many altcoins going through the roof. More ICOs were launched than ever and lots of funds were generated for development. You can find an overview of the ICO market in 2017 here.

With this boom, the industry got lots of attention and I believe that more people decided to jump on the same train because of that. Unfortunately, that also attracted a lot of scammers and people trying to my a quick buck.

However, in the cryptocurrency and blockchain market, there are lots of potential and many people know it. The 2017 boom is proof of that or at least proof from a speculative point of view.

Remember how Bitcoin hit $20 000. Well, just imagine you’re a developer that understands blockchain technology and have some kind of idea to launch an ICO and build a startup? You could be thinking, what’s from stopping me doing the same?

What’s next?

This industry is filled with speculation so who really knows why there are so many cryptocurrencies available. I mean, we don’t even know who exactly created Bitcoin.

However, what an exciting industry it is indeed. Things are always changing. Who knows, a year from now there could be 1000 more cryptocurrencies (I hope not) or 1000 less.

Only time will tell.