How Do Big New Cryptocurrencies Emerge?
To the outsider, it can seem as though a big new name in the cryptocurrency markets emerges every other week. In fact, there are scores of different digital coins out there – and only a select few have made it big enough to start pulling in mainstream traders. But how does a cryptocurrency get to this level of fame and/or notoriety in the first place?
To the average trader, big new names in the world of crypto are likely to emerge by chance. They may be using some of the best crypto exchanges online, for example, readily updating with emerging names in alternative trades. Otherwise, it’s worth keeping an ear to the ground when it comes to coins and crypto that are building up steam behind the scenes.
Let’s take a look at how new crypto gets started, and how it has the potential to pick up steam.
Creating a coin
As it stands, it’s thought that the vast majority of new cryptocurrencies – those emerging at this stage of proceedings – normally have a purpose behind them. These are known as utility coins. They are widely used to help encourage the purchase of specific services and goods – as opposed to encouraging the investment in stocks and shares.
Therefore, the markets appear to be growing more with utility connections and payments in mind than, say, with a view to there being a ‘new Bitcoin’ or Ethereum. That said, with the rise in NFTs still unlikely to wane completely any time soon, associated crypto such as ApeCoin are becoming more and more interesting. This coin is loosely affiliated with the NFT boom thanks to its supposed involvement with Bored Ape – perhaps the best-known NFT line to date.
Creating coins takes a lot of time and effort. What’s more, it requires incredible expertise. The wider public is still ‘new’ to the idea of cryptocurrency, period – and it’s safe to say that the intricacies of bringing a new coin to market will mystify seasoned players, too. Selling a coin, however, is a different process entirely. Once you’ve brought on board the experts to help design crypto, how do you get it out to the masses?
Marketing coins
Marketing new coins is perhaps just as tricky as actually designing one outright. To sell a new, viable coin to the masses, you have to be clear on goals, intents and purposes. As mentioned, many of the bigger emerging cryptocurrencies are utility based. That means, ultimately, they are tied to a specific purpose.
This can mean, hypothetically, for a new coin to gain any ground whatsoever, it needs to have firm backing in the form of an action plan. This may be something as detailed as a white paper, for example, or it may be a simple, clever, viral marketing campaign. It is rare that something as relatively innocuous as an NFT (in terms of definition alone) will make millions sit up and take interest.
Investors want to know what big new coins plan to achieve long term. What is it about these new coins that helps them stand apart from the likes of Ethereum and Litecoin? What is the unique selling point, and is that necessarily translatable into a viable, sustainable business plan?
The launch hurdles
What can often stop new cryptocurrencies from scaling the heights of popularity is actually getting to mint and market. Legal issues, for example, can affect how far new coins travel. As many territories and public services are still so rigid on where they stand regarding digital coins, minting a new currency requires a lot of legal wrangling and planning ahead. How do you ensure that your new coin isn’t open to fraud such as money laundering?
What’s more, only the fastest, simplest and most steadfast cryptocurrencies ever actually make it to that all-important build and mint phase. Yes – this is going to require abundant technical knowledge – but beyond that, your coin needs to have ‘legs’. For a coin to stand any chance of success, it needs to have firm roots and frameworks with safety and scalability in mind. Cryptocurrencies are built to grow and inspire, not to stagnate.
Therefore, it’s actually quite rare that you will get to see too many new coins emerging on the established markets. The process between designing and minting is not only stringent, marketing and sustaining a coin takes more than just crossing your fingers and hoping for the best.
This doesn’t mean we won’t see a downturn in new crypto emerging – but don’t be surprised if utility coins are the norm within five to ten years.
