Bitcoin Forum

I recently saw a discussion where this was asked and apparently nobody knew the answer:

Well, after much observation, let me tell you what the answer is. For at least the first year, the most valuable feature of any altcoin is its development team. Most especially, the altcoin's lead developer. This is the only reason why Litecoin is succeeding where other altcoins have failed. Some people think that what you really need is good marketing, but they fail to see that good marketing comes naturally from a strong dev team.

I'd be interested to see what everyone's thoughts on this are.

Maged has a good point and I agree.

I also think that the implicit nature of alt-coins being an experiment of an experiment adds value to them if indeed they are trying something different.

The interesting part about this is that doing something different that makes sense and has practical value implies a good initial development team. Love it or hate it, this is why Ripple is still around. Let's not make this a discussion about Ripple, though.

The people.

My rebuttal to that is...because it is still closed source your comment is invalid in my view.

The community can't give proper input based on actual FACTs from the SOURCE CODE.

The only fact that exists is that ripple is being "developed", closed sourced, and centralized. But that is going on looking at OpenCoin's actions.

Ok i'll stop there.

I disagree. The people follow a good dev team. Once you have the people, though, you no longer need the original dev team. Bitcoin is an example of that.

And smoothie, I said to keep this thread not about Ripple.

True, it is the devs. Thats why I believe PXC should start rising in value, although at the moment not enough people are getting behind it because they are all distracted by all these other shitcoins -  Other than that, I believe NetCoin will be the strongest, I think NetCoin will be the best new alt to come out in months - Great team behind it, doing everything right -

even thought the "developed team" of PXC premined 1M coins?

Copycoins are gambling. They just hope they aren't the last ones to exit.

Innovative coins are hedging, if something goes horribly wrong with BTC maybe a different coin will survive.

copy coin is not a gamble. you dont lose anything if you coins go straight to bottom
its a way to make quick money

speculation

Yup.

The investment made by the PXC developers (Phenixcoin.com, Phenixauth.com, PhenixST.com, PhenixTrader.com, Phenixpool.com and things to come) is larger than the value of those 1M premined coins.

1,000,000 PXC is currently worth a "staggering" 115 Bitcoins.

If they would dump it on Cryptsy right now, there isn't even enough volume to get to that amount.

I don't think they would waste all their efforts and good work by dumping their premined coins, it would be pretty stupid.

They give away coins in their casino to attract players (free roll games), they pay other (casino)gamedevelopers to work and create games, etc.
Nothing is hurried, they take their time and I prefer that over "pump and dump".

Maybe the launch of their coins was 2 weeks too early but I don't mind, I mine while diff is low :)

what makes alt coins valuable.  yes the development team.

by developers I mean the programmers.  how many years of experience.  how much code they've implemented.  how much cross functional experience they have in other fields. 

so in reality it makes the 2013 batch of alt coins worthless as they are all minor tweaks of the existing code base.  nothing interesting at all.  even yac just replaces sha2 with sha3.  no big deal.  still uses the same crappy peer to peer implementation, still uses the same crappy wallet.  that coin bay far is the most innovative but is still lightyears from being innovative.

Well, yea, we always judge a coin on if any were pre-mined or not. Honestly I think we need to throw this out the window. Im not against a coin being pre-mined, only because those pre-mined coins can be a good idea to get an exchange started, a casino, giveaways, etc.
 And, if the coin is successful, should the development team behind it earn some type of reward for their hard work? I think so.

 Honestly It's not as big of a deal as what people are making it out to be. Still like I said, the dev. team behind PXC is doing great.

The devs benefit by a high price too, so they have to make it successful to see any returns of their investments in coding and other labor they put in it.
Knowing the devs have 1,000,000 PXC is an assurance for me they will do anything in their power make it a success.

They didn't dump their coins, they tried to keep PXC of an exchange for an extra week, they created a free of charge escrow to prevent scamming, etc.

If they wanted it to be a pump and dump coin, the are pretty bad at it  ;D

I don't see why this isn't sufficient for YAC to succeed. People here usually see crypto as code, but the advantage of mining on standard PCs is huge. I haven't seen such an huge improvement jump on any other altcoin.

Or they just wait untill there is enough demand to dump their coins.
Just waiting a little bit longer makes them more valuable. That proves nothing.


Premining is never acceptable.* If they really belived in it they could mine for themselves and still make a fortune if the coin succeeds. At first there isn't much competition on a new altcoin and beeing a premined crypto scares a lot of people away.

*maybe if the coins will be sold at predefined prices and the money goes to charity.

To nitpick. YAC replaces sha256 with sha3, scrypt-salsa with scrypt-chacha, scrypt(1024,1,1) with scrypt(N,1,1), has 60s block time, diff and reward retargets every block, and includes NVC 0.4.0 Proof of Stake.

But of course a new UI would be nice.

the community that stands behind and support the coin they mine

Lot of stuff...

Bitcoin - was revolutionary at the time created, huge community, press... nobody would look at it today though, very outdated. But it was first and ti will be first as long as something very, very innovative comes.

Litecoin - not original  all but the one that managed to position itself on the market and get big community of people, many of whom were bit late with bitcoins. Definitely the second one in some medium period.

Now about recent alts and why I invested some of them..

YAC - because it's kick ass coin that took some time to think and develop, different than any other, growing community, both developing and supporting ones. Proper coin, as far as my technical knowledge or lack of it could understand - technically the best coin on the market.

DGC - good name, pretty good community (with some boring twats but yeah, it comes with investing  :D), active dev (though I don't like his approach sometimes, he takes too big profile for my taste at times)

GLD - best name out there by a country mile, if it manages to get over usual babycoin problems and if dev stops to be asshole at times, it might buy me a car in a year or two. GoldCoin is just a brilliant name.

WDC - well, not sure if I'm happy I've invested in this one as I did it in wrong time but there is still hope

MicroCash - have not yet invested anything in SolidCoins that will be converted to this thing but will look at it. Not a fan of is developer and don't really completely understand it yet but it looks original and I like that,, will certainly dig to it at some time to try to figure it out better.

Wouldn't touch anything else at the moment.


That's bullshit. If it is not acceptable for you, you don't deal with it and that's it.

Developers should make money from creating coins, specially those that stay around and take care about it. Why the heck would a dev who accidentaly has one rig only finish with 20 times less coins than some gpu farm bully.

It's not charity.

If I'd create a new coin I'd premine nice amount of it or would take care that I bank from transaction fees. If some self-precious moaner wouldn't like it, well, let it be.

Premine, premine, premine... most boring and twattish thing in crypto community. Can't stand "premine moaners"

I disagree. How much work does it take to launch a new alt currency? It's not much, so why should the creator premine a bunch for himself? Why does he deserve it?

One reason why I created Litecoin was because almost all the other alt coins before it had a large premine. The ONLY reason to premine a coin is if the creator is greedy and wants to strike it rich. If not, then he/she should just mine it themselves. If they really believed in the coin, they would accumulate coins by mining it the whole time and buying it on the exchanges, and then work hard to make the coin gain acceptance and gain in value.

I spent very little time on the coding part when I created Litecoin. What I spent time on was on coming up with a process to launch the coin fairly. I also spent some time thinking of a good name for it. When it was released, I only had one CPU pointed at it, so I did not mine a lot of litecoins. And I've bought more litecoins than I have mined. That's because I believed in it and I worked hard to support it.

So no, alt coins should not have a premine. If the developers truly believed in their coin, they would be a buyer and not a seller on the exchange. I will never support a coin with a premine.

Well, I never thought there won't be people who will disagree as it is obviously a "matter of life and death" here if coin is premined or not. It's kinda a movement, you're not cool if you don't write 2 premine posts per day.

I'd rather coin developer have nice chunk of coins than big farm owners who are jumping from one to other coin and have big chunk in all of them. I'll take individual premine over big "capitalists" raping coin by coin any day of the week. I feel more comfortable seeing loads of coins in dev's wallet, as long as he is half serious one, than in mining speculators ones.

Then he won't need to setup a bounty for development as you guys did the other day but will finance it from his personal coin wealth.

Premine moaning is pretty much like when Manchester United fans moan because there is City and few other clubs on the scene now and their club can't buy all the best players they used to buy for decades. It's only we that could do it, when other do, it's not the proper way. I'm devastated for them  ;D

That's what people with 10 rigs do when creator premine some coins without really caring that their mining power is pretty much premine to some folk with lack of it. That's why I call it bullshit. If it would be fair game where everyone have same chance, than yeah, premine would be bad. Since it's not, creator would be stupid to stay "poor" while others are banking on his creation, no matter what kind of work is needed for it.

On the end of a day, the coin that is main theme of this forum is premined too by all premining definitions people like to talk about here. Yeah, coins were not moved but we never know they won't be at some time. So, premining is bit of traditional thing  ;D

While a coin needs a good development team to get it going, it needs a reason to stay around in order to have real staying power. None of the clone coins have such a reason, so they eventually die out (after the inevitable pump and dump). Coins like litecoin, devcoin, ppcoin, and namecoin were unique enough to gain the critical mass that allowed them to survive.

There's nothing but cosmetics original in Litecoin. If originality is the only thing required for coin to survive Litecoin would die week after it's creation.

It's a copy of Tenebrix who was real innovation but failed due to, even I must say it, excessive premine, and Fairbrix who was also Tenebrix copy, not premined one but failed due to attacks and some bad coding..

Make a look at it's original thread and you'll see no difference than with any of last few weeks releases. People saying it's pointless, doesn't bring anything new,etc, etc.. it was just launched at real time and somehow everything kicked good for it.

Litecoin wasn't original similar to how Microsoft Windows wasn't original.

I took all the innovations (Solidcoin's fast transaction time, Tenebrix's scrypt), put it together without the baggage (Tenebrix's multicoin code, premines), picked a good and memorable name, and released it in a fair manner. The innovation is not any of the pieces by themselves but the package as a whole. It's not an accident that Litecoin is thriving and most of the alt coins before it are all dead.

grassroot and dev support

What makes Alt Coins valuable?

1. Speculation

2. Developers

3. Integrated marketing communications

4. Alt coin Miners

5. Alt coin Exchanges

6. Public, Company, Government Support

7. Trust

8. Innovation

Favorite post on the subject so far.

Kinda what I think about PPC too. (minus the name which, with no bad intentions, verbally sounds off).

At this point though, even if a coin was really really innovative and could save the world, I don't see any able to take over (or even mimic) ''the big 3" (btc, ltc, ppc). The advantage of being the first is too strong and the community is not gonna spread the love more than it already has.

I disagree.
Althought I hate the premined coins of today I belive a fair premine is very beneficial for an altcoin. By fair I mean that there are fixed prices and ammounts to sell them at exchanges. f.e first premined 10.000 ATC will be sold for 0.001BTC (limit order) each and the money won't just go to the developers or just very limited if it's a huge success.

The reward will be used by an foundation to compensate first the expenses*2 (hosting,domains,...) to early supporters and at last to  new inovations. If a developer wants to make serious money nobody stops him to be an early adopter.

Example:
If someone donated 1000LTC at the beginning it wouldn't have made much difference for anyone, but 1000LTC with a limit order of 0.03BTC is serious money and motivates everyone to improve the crypto in the beginning.

It was not original, period. And that's what was in the post I was answering on.

I won't argue with other stuff, right time, right place, picked support, that's good.

"Value" means different things to different people.  Here's how it breaks down, imho:

Well-intentioned altcoin Dev: "I will create a coin that is at least a 1% improvement over other coins (in speed, security, other features). That in itself is a valuable contribution to the world and that's all I want. Here, world, try this! I've only mined enough to test it!"

Serious trader:  "A new coin? Sure, I'll buy, let me do some due diligence before I spend tons of cash. 1% better? Great, great! So it's worth something... Do you have any support ready to buy it at a set price on exchanges and prevent a dump?  No? Alright then, how many are you keeping for yourself?  No premines? Nothing at all... So you're telling me you think your coin is worthless! But you want me to buy it with actual money?  Ahmm... Let me talk it over with my pump-and-dump buddies..."

Pump-and-dumper: "Huh, this thing is starting out with low difficulty and no support... Better throw all I've got at is early on and dump all the way down before all the noobs switch from looking at coinchoose... Amazing that there's still 'tards left to buy these turds! With my superior intellect I've even come up with a corollary: "Any exchange of similar cryptocoins will expand to include all available idiots, diluting its total value down to Epsilon per share""

Exchange: "We don't care what it is, we want VOLUUUUUUUUUUUUUUME! Premines for the short-term win!!"

Average miner: "New coin huh? If it's ASIC resistant I can mine it, as long as I can trust your wallet code... Aww too late, already doing the circuits in coinchoose... By the time I get my first block the prices will have dropped so I have to cut that profit figure in, let's say, half... Not worth the time, nope, not going to mine it, better stay blue chip! I'll just stick my poorest performer on it, just in case I get lucky. Gotta buy a ticket to win the lottery right?  Now if you'd said there was support so I know the price's not going to drop below my power costs..."

Idiot left holding the bag: "I have millions of these, I'll make a killing in 10 years when it's worth 2000$ a piece!" 

Average new coin supporter: "We like this thing, we want to mine it, just don't premine, it wouldn't be fair to us. Also make it hard to mine at first, but not so hard that WE can't mine it, because WE LIKE YOUR COIN. Make it so nobody but the deserving should get in on this at first... although... eventually it would be a good idea to see if we can get people in the real world to use it.  Can't do that now though, since it's not stable yet... oh well. Here's a donation, please like me, I like your coin!"

Less-than-average altcoin coder: "Twatcoin!  Durhurhurhur!"

Did I forget anyone?
...

My point is, there's very likely a sweet spot between no support and full frontal premining where a coin should achieve stability at launch on exchanges, because everyone can see the intrinsic and extrinsic value of the new coin. I mean would you, today, buy real Freedonian dollars knowing there's no one to back them, no development, no real assets behind them? Would you buy them if you know that every time the creator of those dollars sells jalapenos from a plant in his dorm window, he uses the proceeds to buy more Freedonian dollars, supporting their price? 

Anyway, this is my worldview. :) (yes, the people in my head talk in funny voices too :) ) I'm not an economist, so sometimes I feel I fit right in. :D

Not true, Litecoin development team is very weak, mostly a copy pasta team (syncing Bitcoin changes to Litecoin), not a real development team, and also not as active as PPC development. Yet PPC is far less valuable than LTC. LTC is valuable because there are actually services for it, TPB accepts it, tons of traders on this forum accepts it, and there's ltcglobal (which means if you want to buy shares in BTCT.CO, you MUST buy LTC), and then there's atlantis.

Actually backing your coin, as in standing ready to buy it back at very nearly the price you sold it for, does seem to be useful.

Take a look at http://galaxies.mygamesonline.org/digitalisassets.html

See all those assets valued at more than one bitcoin? Those are the ones whose theory was that its backing your currency that makes it valuable.

-MarkM-

Some altcoins have utility. They derive value the same way Bitcoin does:
The ways of acquiring them, the people interested in doing so and economic activity taking place because and after it.

Litecoin had utility initially because its different hashing algorithm, which became more pronounced with the release of Bitcoin ASICs, it would never have gotten that far without that and only recently secondary economic activity started taking place. I don't see any other altcoin archiving that, except namecoin which derives it's utility by other means.

Age of Coin
Hash Rate?
Innovation
On going Development
Amount of Coins (and total coins)
Launch (bad/good)
Uses
chances of survival
=
Namecoin no1 <3

This not true, LTC copied the scrypt hashing algorithm from tenebrix, yet tenebrix failed.

Everyone has there own opinions about what works and what dosent. The fact is pre-mine or not dosent matter. Its the team behind it that matters along with all other technical aspects of the coin. Some get lucky with coins some dont. Unfortunately now, with umteenmillion alts. every week coming out, its much harder to distinguish, rather than several months or years earlier, would have been much easier to get a success.

tenebrix was not a coin. It was inflationary, and it was pre-mined.

Had it not been either of these things it probably would have succeeded. It lacked utility in a sense that the time till inflation would have negated the gargantuan pre-mine would have been many years.
Fairbrix would have succeeded if it had protection against a 51% attack.

I think altcoins are not only valuable but necessary for the Satoshi experiment to be successful.  Since the first few alt-coins appeared it dawned on me that Bitcoin will never be the lone Sathoshi crypto currency.  For the same reason that Bitcoin has flourished to the chagrin of fiat currency advocates, so will alternate crypto currencies to the chagrin of some Bitcoin advocates.  It’s relatively easy to start a new crypto, so there is no way to stop a constant parade of altcoins.  This is actually a positive result because we won’t be putting all our Satoshi eggs into one block chain.  Any attack on one crypto currency has no direct effect on the others.  The Satoshi currency pool as a whole becomes much more resilient since they present numerous targets, each with different protection schemes.  Then there is the issue of transaction volume.  Bitcoin by itself may never be able to handle the transaction volume of a fiat currency, but a pool of crypto currencies will.

This begs the question of whether an endless supply will ultimately doom the whole Satoshi crypto currency experiment to a price spiral into the abyss.  What prevents an oversupply?  The answer is the same as for anything else which is traded.  Market forces will control the number of variants, and eventually produce a crypto currency supply equilibrium. 

The details are not easy to predict, but I suspect it will go something like this.  An essentially constant stream of new crypto currencies will appear from this point forward.  Some will be clones of existing ones to provide added transaction bandwidth.  Others will provide new features.  However, only a limited number will become widely adopted by the general public.  Look at fiat currencies.  There are about 200 of them, but the vast majority of commerce on the planet occurs in just a half dozen or so fiats.  We will see the crypto currency majors, minors and then “the others”.  The exact number of each is hard to say, but I would think somewhere in the range of 10-20 majors and another 15-30 minors may be a good guess.  Then dozens of others will constantly vie for entry into the higher ranks.  It may take 15-25 years to get to equilibrium, where a large percentage of world population uses crypto currencies regularly.  As with any new technology, it takes time to reach a critical mass.  It also takes time for the technology to work through its early deficiencies.

Finally, we have truly deserving currencies entering the world currency competition.  The fiat currencies have offered poor choices, where even the best are highly controlled and inflated.  The upcoming crypto currency competition will be relentless and fierce.  It will ensure only the most innovative, secure, and user loyal cryptos will retain the highest ranks.  Attempts to control them will be futile since many alternatives will be waiting in the wings to take their places if the public loses faith in any.  Fiat currencies will compete as well, but they will need to curb their inflationary ways considerably to have any hope of surviving as major currencies. 

We can also think about the number of crypto currencies from the perspective of the users and suppliers.  It is not realistic to say an endless number can be maintained simultaneously.  You would need a client, miners and a block chain for each one.  If we consider miners, they want to mine coins which will be worth the cost of mining, either now or in the future.  Once we get to an adequate number of cryptos to meet the transaction volumes, a new crypto will need to offer something unique and superior to what is already available.  Otherwise, it will not be able to attract the miners to support it.  I doubt a thousand or even a hundred crypto block chains will be viable long term.  It just won’t pay for a miner to continue wasting time and money on something which isn’t going to be adopted by a sizable number of users.  The same goes for the client developers.  The miners and developers must be coordinated and persistent in their support for many years if the currency is to survive.

From the user’s perspective, they don’t want to maintain dozens of clients just to go about their daily business.  They will most likely choose a few crypto variants based on what they buy and what vendors will accept.  In the end, there will be a market agreement on which cryptos will be the standards.  Over time the pool of standards will evolve.  Market forces will remove those currencies which have not lived up to their potential and new ones will be added. 

What about someone who chooses to put their money in a crypto which loses all its value?  Well, it’s a bit like choosing stocks.  There’s no guarantee your choice will always pay off, but keeping your funds in the majors will generally be the safest bet.  The key is that you have a choice.  In the case of fiat currencies, a citizen of a given country has almost no choice which currency to use for their daily transactions or for salary payment.  I would prefer having choices any day over having none.

In summary, we cannot think of Bitcoin as the only true crypto currency.  We need to think of the Satoshi crypto currency pool as a whole.   It has ushered in a completely new payment and value store option which will benefit the world tremendously.  There will be teething pains, but the long term result will be more stable currency markets and, for the first time, a real choice of currencies for the citizens of the world.  It will allow people to make their own currency choices unlike ever before.

+ 1 ^^^

100 years from now, none gonna remember all the alt coins that wont make it till then or "you" being annoyed of all the "copy/paste", "not innovative", "premined", "scamcoins".
They will remember the 2 decades that changed the economy of the world.

This guy ;this guy only :



http://thefinereport.com/wp-content/uploads/2013/04/Occupy-bum.jpg



if you want to success in this business , go talk to him, by appointment.

Yes exactly, why did LTC not suffer 51% attack? because there were significant amount of support at launch, it maintained a very high hash rate. This is my point, LTC succeeded because there were a lot of people behind it, mining it, building services for it, and then attracts more people mining it. LTC didn't succeed because it was the first scrypt (it's not), or it has good dev team (it does not). LTC is successful because there are many supporters for it, right from the start. No other coin has nearly as many supporters at launch as LTC did.

Support by community and developers.