Bitcoin Forum

The easiness of creating tokens on existing blockchain has seen the crypto market flooded with different crypto assets. This really have an effect on the price level of cryptocurrency but the confusing question is how? I will really appreciate a clarification on the connection between token emergence and the price level of cryptocurrency market.

By the way of dividing the total investment into different assets. Crypto market is attracting billions of dollars every year but the presence of thousands of tokens in the market is actually doing more harm than good. Majority of the tokens have no value as majority of them are either scam or have no long term business goal. We are seeing hundreds of ICO popping up every month, but how many of them are actually succeeding? Almost no one! So all the investments made into those ICOs are going down into drain! If these investments were flowing into few major cryptos like bitcoin and ETH, that would have increased the demand as well as the price.

Tokenization is a good feature but this is being misused heavily! Result?? ICO market is loosing credibility as well as decreasing the credibility of the crypto market. So the loss is not only financial, you see!

It is because of the demand and progress.

• Demand : When a cryptocurrency has so may demand in trade and volumes its price will move and vise versa.
• Progress : If the developer stop its progress into achieving its roadmap then investors and traders might lose interest and leave the coin thus making it less valuable

It is the division of investment.

Look at all of that tokens that is being created and then being input as a new ICO token.
Even though they do not have the good project there are still buyers who will risk something to them.
Also, even if those are just hundreds of dollars or even .1 ETH was bought in exchange for token that is still investment.
Imagine if all of those small investment could have been in bitcoin. We wont be seeing this small price by now.

I believe the correlation between cryptocurrencies vastly popping out and the market price has a small impact. The market purely based supply and demand, and increasing cryptocurrencies fork are having zero effect on them. Mostly because those projects are not having real value and real-life usage.

There is somehow become the norm for a scammer to create an ICO over and over again to deceive people. I'm started to think that it is because the perspective people have on cryptocurrencies volatility markets, so they thought they able to get rich overnight.

Tokenization is harmless if we look at it as an easiness to create new tokens. But it becomes pretty bad in the way that when new tokens emerge into the system and people get pretty excited about it. They invest heavily in the crowdsale and later on the project as a whole turns out to be a wholesome scam. This creates a fear in the minds of investors regarding not only the tokens but towards the cryptocurrrency system as whole. This fear decreases reputation and trust of the crypto world and therefore ultimately reduces the overall pricing too. Not only this another issue is the past tokens performance. Not even a single token comes in my mind which has completed even 40% of the promises made by them in their whitepaper. All they are being used for so far is price manipulation and trading.

The fact that almost everyone could create a token in just a few hours is definitely not doing anything good for the cryptocurrency market and thats because 90% of tokens created are useless. Think is tokenization would have been available only for certain businesses and projects that are checked before by a commision. On the market we would find only good tokens that were created with a purpose and the price of whole cryptocurrency market would be even higher than it is now with all this fake coins existing. But this scenario is something that seem impossible to happen , at least not in the near future

The investment gets split into new tokens. I feel this is the reason behind coins having less demand and less value. The current market would be another reason behind token and listed coins having less value. The team should the pillar working behind to increase any token values.

The addition of too many tokens means that the entire crypto market is diluted with shitcoins. This brings down the price of bitcoin as money is going elsewhere when it should be into bitcoin and ethereum instead

Let me use an illustration to make you understand better. Lets say you have an Apple (blockchain and it's coin) now with that Apple plus others ingredients (blockchain improvement) you produce an Apple juice (New token based on the previous blockchain) then you place the  Apple and Apple juice to sell in the market (exchange) there are possiblity potential customers (investors) will choose any of the two sampled goods to buy therefore dividing their money between the two goods and this will directly affect the price of the Apple since the Apple juice (new token created on it's blockchain) will share the investors capital unlike if only Apple was listed, all the investor capital would had gone it's way.

I believe tokenizing somehow drive Bitcoin and crypto prices due to the demand. It has direct or indirect effects, the increasing numbers of cryptocurrencies are likely to happen due to blockchain trend but I believe the increasing value of crypto is not the real cause that makes most tokens almost no value but once the projects deliver their products and attract investors they can easily rise from ashes.

They have less demand and value is because there's better cryptocurrency that's already used by the majority. They're forcing their own tokens when it's not needed.

The team alone can't stop their token from losing value because there are different reasons for the price go down. Making slight changes won't cut it their investors controls the value not them.

right, here the quality of the token becomes a necessity in order to survive the cryptocurrency, by having a function and needed by many people it will certainly make these tokens shine and host on bitcoin

Maybe more precisely is the killer of bitcoin and ethereum. Because, since the emergence of hundreds of ICOs in enlivening the crypto market, the adverse effects directly worsened the market conditions although the initial decline was slow, however the tragedy of falling prices for bitcoin and other cryptos we can still feel until now. So from that I assume, there is no best innovation other than bitcoin and ethereum, even though ethereum is at least considered a bitcoin killer.

The only thing that I can find is that all those shitty tokens, that are created on Ethereum blockchain use gas for transactions and just spamming the blockchain while they don't have any serious value. This issue is increasing ETH transaction fees and making ETH and ethereum based tokens less attractive.
Luckily all those garbage tokens have a pretty low volume and don't have much influence so we shouldn't worry about that.

I beg to a little bit disagree. It won't split if I do not like to buy apple but just an apple juice. Being an investor I have the option to invest where I think I have the advantage. It doesn't mean to affect the price because there are two different products. The competition goes only if there are two same product and you have the advantage to offer less price because it is the same. In this example these two differ and I see no competition so the price should still be the same.

There are many projects that present a great idea for development and they ask for funding. However, they declare that they cannot continue with that due to some problems that they are facing.
So, what do you think is going to happen with that? People who trusted their money to this team and thought that they are going to have a profit, they start selling and they probably lose their faith in the cryptocurrency market, as they lost money for it with nothing as a return.

I think that it depends on the nature of what is being tokenised.

If it's equity of a company simply issued in token form, then I certainly do not think that it's direct competition to a decentralised cryptocurrency like bitcoin, and thus, I do not believe that the value of other decentralised cryptocurrencies will be diluted as a result, especially when you consider the injections into the total market that would have resulted anyways.

If it's another new, decentralised crypto, or a fork of an existing crypto, it could possibly pose direction competition and as a result take value away from existing coins if it doesn't attract external investors. But TBH, the market as a whole right now is large enough that these little dents don't really matter.

this "eagerness" that you are talking about has only been all about making money the easy way and lots of it. if you look back at all these useless tokens that were created, which are a couple of thousands already, they have all been created so that their creators could make a large amount of money and abandon their token soon afterwards. so in reality they are not really "tokenizing" anything, they only create a useless token while using some buzzwords to fool people into investing in their crap :D

I don't think it divides the money as much as people think, I believe there is still people who get into bitcoin but just somehow moved towards other coins for the coins sake and got the money for it without diluting their investment. So, what I am trying to say, lets say someone has 1000 dollars in bitcoin but sees a new coin and puts 100 into it, they do not put the 100 from bitcoin, they probably put a new 100 into it, so instead of having 900 bitcoin to 100 new coin they have 1000 in bitcoin and 100 in new coin.

Obviously, it is not always the case but I feel like that is most of the time what happens. That is why I feel like if you delete all coins above top 100 coin marketcap and put all the money into the top 100, you will definitely have top 100 coins going up but most people will withdraw to fiat because their favorite coins got deleted.

The more token emergence would really affect price yet it would really divide the number of current investors on the entire market and also
most tokens overall are complete trash which would result on losing out confidence on potential investors as well which in result wont really able
to maximize out the potential support to the better ones.

So what you are saying in essence is that lack of value from these projects render their tokens useless? I just want to understand your point more.

With many tokens emerging in this space, it is inevitable that they would take a part of the overall cryptocurrency market cap. With this, bitcoin's market dominance will slowly decrease as more tokens and coins emerge. Some people might take this decrease as a sign negatively and make the price also decrease in turn.

The effect of those useless tokens were making the investors poor and the project team to be rich.

Not all the tokens running on an existing blockchain was shit but most of them were just copy of other coin and some projects even copy the whitepaper as well so investors need to be more smarter if they want to make profits.

Making tokens is indeed very booming in this market which can be divided into several places that can only make prices go down or difficult to rise with fast time because in every day the circulation of investment is very large but can not make prices go up, but return investors want the desired assets , but for a long time there will be tokens set aside because the appearance of a new token or switching to a coin that has a clearer advantage than others, it is already not good because the appearance on the market is not properly controlled.

In so many ways other than one. In economics, the more you have plenty of product in the market, whether same product or optional product, the more the price collapses because value won't be placed on them. Again, some optional products are used as competition to the superior product or commodity.

This is a keen to what is happening in crypto. Bitcoin is known to be the most valued crypto but we now have many other thousand crypto that are in competition, some will never get into the top hundred coin but they are crypto. So, inferiority collapse a value product.

Tokenization is a part of cryptocurrency, maybe it affects the price level of cryptocurrency defends on the volume of transactions. When the volume of transactions are high therefore it affects cryptocurrency price. Because cryptocurrency price is only base on the demand and supply. The more people demand on bitcoin the price also become higher..

Should creating tokens be made difficult then? This is why they are called tokens in the first place. Developers are creating products on existing platforms. It should be as easy as android developers build apps on Android operating system.. Some Apps could even be created in minutes on top of android but what matters is how useful they are and the effort put into creating them. Same is applicable to tokens.

I guess the easiness is not that issue, I think its the capability of making people believe in your project so easily is the issue.

I mean after all you can create a token in half an hour and present it to people and that is not good I agree but I have seen people go "this is a coin on sale and if you fund this I will buy myself a car" and people literally laughed at him and paid him money. That dude got like 200k, way more than a car worth of money (or a lambo), it was a "joke" coin that got like 200k dollars for it.

I understand that the ease of creating a token is bad but people funding stupid stuff like that is way worse problem at hand. We need to make sure there are less coins coming up everyday for sure but we need to make that with funding the good ones and not funding the bad ones, otherwise bad ones will see they will get funded anyway and create one.

Tokenization will definitely effort the market price especially etherum got effected badly  aspect there are many tokens launching in the market but at the same time some projects are a scam so real projects will survive in the bear market

To me tokenization have affected the price of most crypto due to the fact that if various platforms and companies have they own token it reduce the amount of transactions being carried out in the general ledger, because those investors and customers of those company with personal tokens will no longer use the original platform such as bitcoin and the rest and that will reduce the level of demand for bitcoin.

Most coins have very low market caps and a quick glance at coinmarketcap will tell you that the top 10 coins have almost all the market share so the diluting effect of those coins is insignificant, the real problem with having so many coins is that people get confused about why we have so many and when they understand that the majority of them are scams this affects the confidence of investors in the market, which is huge because this slowdowns adoption and reduces the level of investment that comes to the market because investors are afraid of being scammed.