How Many Crypto Currencies Can The Global Economy Handle?

There must be a limit to the number of cryptocurrencies.

Michael Trigg
Oct 29, 2019 · 5 min read

The first cryptocurrency to enter the global economy was BitCoin, as most people in the major markets know. The first actual Bitcoin came into being on the 3rd of January 2009 when Satoshi Nakamoto mined the genesis block of bitcoin — block number 0 — and reaped a reward of 50 bitcoins.

World Spectrum
World Spectrum

As of July 9th of 2019, there were 2,322 cryptocurrencies having a capitalization of USD$349 Billion. At the time of writing this blog post, there could be more.

So the question is: how many cryptocurrencies can the world sustain? They outnumber currencies recognized by the United Nations at a rate of 13 to 1 as there are 180 currencies that are used in 196 countries across the world at this time. The top ten of the most highly traded conventional currencies are as follows, accompanied by each currency’s approximate US dollar exchange rate and its Bitcoin rate.

1 Kuwaiti Dinar [1 KWD = 3.29 USD] 2,458.95 Kuwaiti Dinar = 1 Bitcoin

2 Bahraini Dinar [1 BHD = 2.65 USD] 3,055.91 Bahraini Dinar = 1 Bitcoin

3 Omani Rial [1 OMR = 2.60 USD] 3,120.87 Omani Rial = 1 Bitcoin

4 Jordanian Dinar [1 JOD = 1.41 USD] 5,747.15 Jordanian Dinar = 1 Bitcoin

5 Pound Sterling [1 GBP = 1.26 USD] 6,301.79 Pound sterling = 1 Bitcoin

6 Cayman Islands Dollar [1 KYD = 1.20 USD] 6,754.56 Cayman Islands Dollar = 1 Bitcoin

7 Euro [1 EUR = 1.12 USD] 7,285.09 Euro = 1 Bitcoin

8 Swiss Franc [1 CHF = 1 USD] 8,019.21 Swiss Franc = 1 Bitcoin

9 US Dollar (USD) 8,105.04 United States Dollar = 1 Bitcoin

10 Canadian Dollar [1 CAD = .74 USD] 10,612.33 Canadian Dollar = 1 Bitcoin

Pixaby
Pixaby

The above rates are current at the time of writing as exchange rates are constantly fluctuating. This is due in most part to the world’s ever-changing economic and political situations and as a result, it’s hard for some currencies to remain in the top 10.

Bitcoin currently is at the top of the crypto-heap and crypto-investors are hoping for an Exchange Traded Fund (ETF) that will allow trading in the asset inside the fund while not having to actually own the asset, therefore the actual crypto. While a crypto ETF may eventually be a reality, it is still a long way off. The main reason is that cryptocurrency remains largely unregulated and the U.S. Securities and Exchange Commission (SEC) is very cautious in allowing an ETF based on a new, very volatile and largely untested market to make its way to the public.

Currently, at the writing of this post and keeping in mind all cryptocurrencies are volatile, to say the least, the following is the top 10 as shown on several websites. This does seem to be the most common list but the top 10 does vary.

1 Bitcoin (BTC)
2 Ethereum (Ether)
3 Ripple (XRP)
4 Bitcoin Cash (BCH)
5 EOS
6 Cardano (ADA)
7 Litecoin (LTC)
8 Stellar (XLM)
9 IOTA
10 NEO

In 2017, of the 902 cryptocurrencies Initial Currency Offerings (ICO) formed, 142 failed before raising any funds. There were another 276 that failed after fundraising. Then there was another 113 ICOs falling under the “semi-failed” category due to the respective startup failing to make a splash due in most part by ceasing to communicate on social media. Another reason was the community around which it was formed decreased to the point where it had no chance of success. These indicate a 46 percent failure rate and losses to investors in excess of $146 Million. [1]

Public suspicion of cryptos remains high as the bounce rate wildly continues. Bitcoin has gone from a high of USD$19,783 in December 2017 to a low of USD$6,200 by October 2018. As of today’s date, Bitcoin is trading at USD$8,100, great if you bought in October 2018, not so good if you bought in December 2017.

So in answer to the question: how many cryptocurrencies can the global market sustain? The answer seems to be: not that many. There are 196 countries in the world. That means roughly 12 crypto-currencies per country. The crypto ICOs that do succeed getting off the ground has a very high failure rate. Do the numbers. Does it work for you?

If you are risk-averse, crypto is definitely not for you.

[1] https://hackernoon.com/the-10-dark-secrets-of-cryptocurrencies-that-almost-no-one-knows-about-ec284bed7e71


The Capital

The Capital (former Altcoin Magazine) is a social financial news aggregator powered by Bitcoin

Michael Trigg

Written by

Since 2012, I have been business consulting and writing through my own agency Handshake Business Consultants. Fiction books, business plans, blogging, articles.

The Capital

The Capital (former Altcoin Magazine) is a social financial news aggregator powered by Bitcoin

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