The problem of some top20 coins is that their characteristics are too advanced for the average buyer.
Buyer wants a coin he can understand what it does.
Litecoin he can understand. It's BTC but faster.
Darkcoin he can understand. It's BTC but faster+"darker" (private)
DOGEcoin he can understand. It's BTC + faster + "funny" + billions of coins for the lulz
Namecoin... wtf is this, yeah well we already have DNS
Protoshares...
Ripple...
Mastercoin...
NXT...
Maidsafe
Counterparty
So how is someone to buy if there is no understanding what it does. And those who do understand thinking "oh that's great, has vast potential" etc etc, well, they are waiting for the "simple money" to jump onboard so that they can get appreciation on their early buying. But the simple money doesn't follow the large money / early investors because they don't understand what these coins do.
Cryptomarket is weird. You can sell a simple concept but not a complex one. The more complex the coin is, the better chances it has to get itself buried.
If this post has widened your understanding* of the "complex-coin market" psychology and why some coins tank when "...they shouldn't", tip freely
*
This is an expensive lesson that one will figure out only if they've burned their money in "complex coins".This is a great post.
There are 3 main problems with Gen 2.0 platforms starting with Ripple, NXT, and the rest.
(1) Complexity on a tech hobbyist level.
(2) Very high counterparty risk.
(3) Decentralization results in poor liquidity.
Bitcoin is about the absolute ceiling for acceptable complexity in mainstream crypto.
Most people are used to banks, brokers, real estate = insured and zero counterparty risk...
All of these Crypto Asset platforms are EXTREMELY dodgy relative to the Developed World...
For example, the #10 asset on NXT is a bunch of guys in Iran taking money to build an small ASIC farm...
You have precisely ZERO protection against these guys stealing your money.
And the last one liquidity...
XCP seems to have doubled transactions to about 300-400/day in the last 3 months (very nice!)...
And the NXT AE does about 200 tx/day (I would bet a LOT of that is faked by NXT whales)...
But this is microscopic and results in very poor liquidity... and MUST GROW FAST.
Bitfinex is doing 100 times the volume of NXT... 10,000 vs 100 BTC/day (not counting swaps).
Liquidity is a very esoteric, hard-to-explain phenomenon...
It tends to spontaneously explode around well-designed, centralized hubs...
Whales play a huge role in this... and liquidity begets more liquidity...
It would be very hard to grow on klunky, decentralized platforms (with 3-4-5 protocol layers, what could go wrong?)...
And any perception of counterparty risk just totally KILLS liquidity.
5-10 years ago ECNs were able to drain massive liquidity from the NYSE/NASDAQ...
So anything is possible if you attract the whales.