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Author Topic: What is the market cap of all alternative crypto-currencies combined?  (Read 957 times)
ripper234
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Ron Gross


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August 27, 2011, 08:27:51 PM
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(Namecoin, IXCoin, SolidCoin, FastCoin, ...)

Did anyone compile such statistics or graphs?

If the market cap is high enough, compared to the total amount of bitcoins, perhaps it would be of interest to create an IndexCoin - a new index fund that would serve as an index on the best crypto currencies (much like S&P 500 is a stock market index). This shouldn't be too hard to implement, and would serve as easy diversification.

I don't know if any of the alternative crypto currencies have inherent properties that are more desirable/valuable than Bitcoin. I would be happy to invest a small part of my Bitcoins in an IndexCoin fund that would track these coins.

Anyone up to create such an index?

(Please disgregard the previous mention of the term "IndexCoin" in this forum a few months ago, this post is unrelated to that old post.)

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August 27, 2011, 09:54:58 PM
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Its bitcoin-marketcap + sucker-index(ixcoin + indexcoin +coin256 + coin567 ...)

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August 27, 2011, 10:13:32 PM
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I'd call it 101% of bitcoin cap.

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ripper234
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August 28, 2011, 06:09:35 AM
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Its bitcoin-marketcap + sucker-index(ixcoin + indexcoin +coin256 + coin567 ...)

Why do you think that by definition, any bitcoin clone is that vastly inferior to bitcoin?
Some of them might have desirable properties.

The largest advantage of bitcoin right now is adoption - "everybody" (in the bitcoin community) uses it.
If a large amount of people started using FooCoin, that coin would gain a similar advantage.

BTW, market cap might not be the best measure of a coin's strength - I can create 10,000 of a new coin, place one BUY order at $10,000 a piece, and reach a market cap of $100M. Is there a better definition that captures the relative strength of some alternative coin's economy?

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August 28, 2011, 06:59:13 AM
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Its bitcoin-marketcap + sucker-index(ixcoin + indexcoin +coin256 + coin567 ...)

Why do you think that by definition, any bitcoin clone is that vastly inferior to bitcoin?
Some of them might have desirable properties.

The largest advantage of bitcoin right now is adoption - "everybody" (in the bitcoin community) uses it.
If a large amount of people started using FooCoin, that coin would gain a similar advantage.

BTW, market cap might not be the best measure of a coin's strength - I can create 10,000 of a new coin, place one BUY order at $10,000 a piece, and reach a market cap of $100M. Is there a better definition that captures the relative strength of some alternative coin's economy?

New block chains are nearly free; anyone can have an unlimited number of them for almost nothing, what is valuable and scarce is a network that can withstand attacks. The rational play is for each individual to join the strongest network. Changing to 3 minutes or 36 coins/block is completely inconsequential and even if marginally better in some way does not make up for 1000x weaker network.

Inclusive depth would be better. Go around and find every offer to deliver something in return for coins. You'll capture a lot of it by summing the markets, most of which is MtGox. Otoh there is a lot of 'unannounced' depth.

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August 28, 2011, 08:23:15 AM
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Its bitcoin-marketcap + sucker-index(ixcoin + indexcoin +coin256 + coin567 ...)

Why do you think that by definition, any bitcoin clone is that vastly inferior to bitcoin?
Some of them might have desirable properties.

The largest advantage of bitcoin right now is adoption - "everybody" (in the bitcoin community) uses it.
If a large amount of people started using FooCoin, that coin would gain a similar advantage.

BTW, market cap might not be the best measure of a coin's strength - I can create 10,000 of a new coin, place one BUY order at $10,000 a piece, and reach a market cap of $100M. Is there a better definition that captures the relative strength of some alternative coin's economy?

Why do you think that the a clone of bitcoin can success? The bitcoin only has value when someone use them, so the large the group the of bitcoin owner, the larger its value. It is called network effect. For the cryptocurrency you listed, all of them are the technically the same (except namecoin). If the bitcoin has any fallacy that lead it fails, technically, economically or government attack, none of the other can. So the best bet is to enlarge the user group of Bitcoin so that it can be eaier to survived.

You can also consider the case of facebook. The largest advantage of facebook is its everybody uses it. If there is a facebookClone (it is not that hard) and large amount of people start using it, then it will get the same popularity. But why it does not happen? Likely, they are spending many effort and reluctant to give up what they build up.

The growing value of bitcoin are from the work of the people building business, core developers enhancing the bitcoin client and the decades of other developers integrated it into different platform. It is not likely that they will jump to a (almost) the same CloneCoin and give up their previous work suddenly. If one day Gavin do decide so, I will take a look for the new project.
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August 28, 2011, 08:54:07 AM
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Why do you think that the a clone of bitcoin can success? The bitcoin only has value when someone use them, so the large the group the of bitcoin owner, the larger its value. It is called network effect. For the cryptocurrency you listed, all of them are the technically the same (except namecoin). If the bitcoin has any fallacy that lead it fails, technically, economically or government attack, none of the other can. So the best bet is to enlarge the user group of Bitcoin so that it can be eaier to survived.

You can also consider the case of facebook. The largest advantage of facebook is its everybody uses it. If there is a facebookClone (it is not that hard) and large amount of people start using it, then it will get the same popularity. But why it does not happen? Likely, they are spending many effort and reluctant to give up what they build up.

The growing value of bitcoin are from the work of the people building business, core developers enhancing the bitcoin client and the decades of other developers integrated it into different platform. It is not likely that they will jump to a (almost) the same CloneCoin and give up their previous work suddenly. If one day Gavin do decide so, I will take a look for the new project.

I think there is a chance that some of Bitcoin's parameters aren't "optimal" in some sense (e.g. lead to slower transactions, more expensive scalability, etc...). I don't necessarily think this is true, but I'm not saying it isn't either.

If 0.0001% of bitcoin users use AlternativeCoin, then it's really worthless and useless to branch into. If 5% of Bitcoin users use an alternative coin, it might be worth it to diversify one's holding from 100% BTC to 95 BTC + 5% AlternativeCoin. I know this is currently not the case, but it might be in the future, especially when/if merged mining will be implemented and widely adopted (I know there are concrete plans for this on NameCoin).

As for the comparison with Facebook, it's not completely fair. If only 10% of my friends and loved ones are using OtherFacebook, as opposed to 100% using Facebook, I lose considerablly if I switch. Every minute I spend on OtherFacebook is in some sense a waste of time. With Bitcoin, since OtherCoin is convertible to Bitcoin in some floating ratio, I could always convert OtherCoin --> Bitcoin --> Goods and services. So I don't need every Bitcoin site to support OtherCoin, just "enough of them", or even just enough people to hold and trade OtherCoins.

Please do not pm me, use ron@bitcoin.org.il instead
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August 28, 2011, 03:09:30 PM
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The only thing that gives bitcoin value is if everyone uses it AND ONLY IT. If tomorrow we had 1000 different blockchains then they all make each other worthless.

The fact that it is open source and easy to replicate is a big problem / awesome.

Awesome because a company could start giving employees some free vending machine uses each month or something.

Big problem because if we split the userbase among a bunch of random blockchains the whole system diffuses and becomes useless / worthless.
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