Why 99% of Crypto Tokens Are Useless

Joseph E. Ikhalia PhD

Introduction

Cryptocurrencies and digital tokens have been gaining popularity in recent years as digital assets, but many of these tokens have been criticized as useless. Determining which cryptocurrency tokens are “useless” can be a matter of opinion, as what one person considers useful may not be seen the same way by someone else. Some people might consider a token that has little to no utility or real-world use case to be “useless,” while others might consider a token with a solid technology but low adoption to be “useless”.

In general, it’s essential to research and carefully evaluate any cryptocurrency or token before investing in it. It’s a good idea to look into the team behind the project, the technology behind the token, and its potential use cases and adoption. Additionally, it’s also important to be aware of potential red flags, such as unclear or unrealistic whitepapers, lack of transparency, or a history of scamming or fraud.

Please also note that even if a token is considered “useless” or not, in cryptocurrency markets, all the tokens and coins tend to be quite volatile, and there are no guarantees of the value. Additionally, Crypto markets are often affected by market sentiment, government regulations, and the global economy.

In this article, I explore the reasons why most crypto tokens are considered to be useless and discuss the implications for investors and the industry as a whole.

Lack of Underlying Value or Utility

One of the main reasons why most crypto tokens are considered to be useless is that they lack underlying value or utility. Many of these tokens are created through initial coin offerings (ICOs), which are a way for companies to raise money by issuing new digital tokens. However, many of these companies are not offering anything of value in return for the investment, and the tokens they issue have no inherent value or use.

For example, many tokens are created as “utility tokens,” which are supposed to be used to access a specific product or service. However, in many cases, these tokens are created before the product or service even exists, and there is no guarantee that it will ever be developed. As a result, these tokens have no real-world use or utility, and their value is based solely on speculation.

Speculation-Driven Value

Another reason why most crypto tokens are considered to be useless is that they are created primarily for speculation. Investors buy these tokens in the hopes that their value will increase in the future, but there is no guarantee that this will happen. In fact, many digital tokens have no real-world use or utility, and their value is based solely on speculation.

This creates a speculative bubble in the market, where the value of tokens is driven by speculation rather than underlying fundamentals. This can lead to significant price volatility, and investors may lose their money if the bubble bursts.

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Ease of Replication and Lack of Regulation

Many digital tokens are easily replicated, which makes it easy for scammers to create fraudulent tokens and take advantage of unsuspecting investors. The lack of regulation also means that there is no oversight of the market, and this can lead to widespread fraud and manipulation.

Furthermore, the crypto market is still in its nascent stages of development, and the technology and infrastructure are not fully mature yet. This also can lead to many fraudulent activities, and as a result, it’s hard for investors to trust it.

Researching a crypto token involves several steps:

· Understand the basics of the token: What problem does it aim to solve? What is its underlying technology?

· Look at the token’s whitepaper: A whitepaper is a document that provides detailed information about the token and its underlying technology. It should include information about the problem the token aims to solve, the team behind the token, and the token’s technical features.

· Check the token’s website: The website should provide information about the token, its team, and its roadmap.

· Look at the token’s GitHub: GitHub is a platform where developers can share and collaborate on code. By looking at the token’s GitHub, you can see the development activity of the token.

· Research the team behind the token: Look at the background and experience of the team members, as well as the advisors. Check if they have a track record of successfully developing and launching similar projects.

· Check the token’s trading history: Look at the token’s trading volume, price history, and overall market performance. This will give you an idea of how the token has performed in the past and whether it’s a good investment.

· Look for community discussion: Check social media, Reddit, Telegram, etc. Try to find out what people are saying about the token, and get a sense of the community’s sentiment towards it.

· Be mindful of misinformation and scammers, do your due diligence, use reliable sources and keep an open mind, for you to develop your own opinion about the token.

Why Bitcoin is considered the superior cryptocurrency:

· First mover advantage: Bitcoin was the first decentralized cryptocurrency, and it has the largest market capitalization and the most recognizable brand among cryptocurrencies. This gives it a significant first mover advantage over other cryptocurrencies.

· Network effect: The more people that use Bitcoin, the more valuable it becomes. This is because the value of a cryptocurrency is derived from the number of people using it, and the more people using a cryptocurrency, the more useful it becomes. This creates a powerful network effect where the value of Bitcoin increases as more people start using it.

· Decentralized: Bitcoin is decentralized, meaning it is not controlled by any government or organization. This makes it resistant to censorship and allows it to operate independently of any third parties.

· Security: Bitcoin has been designed with security in mind, and it uses advanced cryptography to secure transactions and prevent fraud. The Blockchain technology underlying Bitcoin is designed to be highly secure and resistant to attack.

· Limited supply: Bitcoin has a limited total supply of 21 million coins, which will never be increased. This scarcity, combined with the increasing demand for Bitcoin, can help to drive its value upwards over time.

· Store of value: Some argue that Bitcoin can be used as a store of value similar to gold. The limited supply and decentralized nature of Bitcoin, along with its ability to be easily stored and transferred, make it a potentially attractive option for those looking to store value.

In conclusion, most crypto tokens are considered to be useless because they lack underlying value or utility, they are created primarily for speculation, and they are easily replicated and lack regulation in the market. Due to these factors, many of these tokens are at high risk of fraud and manipulation. It is important for investors to be cautious and do their own research before investing in any digital token. While, Blockchain technology and the crypto market have a lot of potential, it is still a developing area that requires more maturity and regulation.