The problem is that tomorrow I could launch a new coin. Freedonia-Coin. Backed by the hearts and souls of the people of Freedonia, who strangely enough have never heard of it.
Yes, this by itself can be devastating to the validity of any new alt coin in IPO, (even if it is the "next big step") ... it smacks of insider IPO trading and is a serious black eye to the IPO launch of any alt coin. It has the potential, even if well intentioned to stink to high heaven of outright vicious fraud. The effort needed to convince people that it is NOT pre-mined, (or announced/launched in such a way that it is "effectively" pre-mined), just smears it, (and at this time every alt coin), coming out of the gate. There will from this time forward be this strong suspicion applied to any IPO alt coin, (by the reasonable and rational speculator as their due diligence is required at a personal level and at a level which makes the market safe for the other speculators and traders they require to function longer term), there will be great suspicion cast forward and back.
Any suspicion at all that some IPO alt coin is pre-mined, (or some special class of miners were allowed first crack at it), is very, very bad, ("Bad Man"). Just the suspicion alone, is wrecking. The coin dev and dev team, must ... write whitepaper and make certain there is verifiable information in place that is convincing ... that as much effort was made as possible to allow everybody an opportunity to be an early adopter. The prospectus in copy, available as whitepaper and guidance for the IPO must be written in such a way that the advantages and the maturation of this new IPO alt coin are significant and real, and that launch then becomes a good and thorough test of the coin as one can then see how it handles it's early mining demand, how mining pool servers handle that adoption in a fair and balanced IPO ... the efficiency with which the blockchain is created and how it weathers the initial storm, etc ... how the exchanges adopt it and deal with it, etc ...
Now I start an exchange, or encourage someone else to ... I dump some BTC in and make sure trades are happening on the exchange ... and make sure that if the price looks like it's going to go too low that there is always someone (me) willing to pay a certain amount. ... all they see is half the long term members calling them names and spewing abuse for looking at altcoins.
You have just created your own eCurrency, and it's pegged to bitcoin, which can be exchanged for fiat, so it must be worth something.
So we see the "snake-oil salesman", (and he has always existed), selling a better mousetrap, selling "Wonder Bread" ... and we must be diligent, we must understand these things and convey them in a manner to the supporters of this new paradigm in a manner in which they can understand, or perhaps, the "Clone Warz", might truly rip us apart and set the entire paradigm back considerably. And then there are those who would happily "be great" and take wretched advantage of the excited citizens of Freedonia, and take them to the cleaners, and even brag about it later. And unfortunately that is a part of the human condition that we must code out of the equation, and it can be done, and some are attempting to do this.
Now before getting out a brush to tar with, ask yourself how many of the arguments against alt-coins can be, and have been, applied directly to BTC, and what is the difference other than "we were here first"?
I think we might both agree that increasing the "real" knowledge of the machinery, the "how it works" understandings among members of the Crypto Currency support community, miners and traders and speculators and potential retailers and marketplaces, etc ..., increasing the awareness that one as an early adopter must understand some of the nuts and bolts of these digital value units is absolutely necessary to be a successful member of this early adopter community and that the late set of early adopters enter upon a playing field where they might develop fairly if they work hard, and if they add their diligence to the equation.
And if bitcoin suffers revelations that uncover facts about it that make it less suitable for ecommerce and all the demands of the electronic marketplace, then so be it, we will have done our due diligence, and these early, brave explorers will have been rewarded and we can move on, they can support and donate to the next "real" good thing in this Crypto paradigm, we should hope. I see the IPO of "clone alt coins", as an opportunity to increase knowledge among our community, to give them the ability to make better speculative decisions and then all of that pours back into bitcoin, litecoin, and the SHA/SCRYPT competitive/complementary structure of alt coin and Crypto Currency.
The wave of "new alt coins" and "clone coins" is an opportunity not to grind the hard lessons learned as glass into a wound, but to build a mirror into which the citizens of Freedonia can peer into and in a wider view, see the reflections hidden behind them without that mirror.
May the best coin win, (it's such an understatement), and along with that, may the most knowledgeable speculator, adopter, miner and trader prosper and trade happily in the longer term.
