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Our analysis of the situation
In a recent bombshell report, Forbes raised eyebrows by exposing what it terms the "crypto billion-dollar zombies" – the Layer 1 (L1) tokens in the cryptocurrency world. These tokens, while boasting significant valuations, allegedly lack utility beyond speculative trading. Among them are some high-profile names like Ripple’s XRP, Ethereum Classic (ETC), Tezos (XTZ), Algorand (ALGO), and Cardano (ADA).
Forbes identified Ripple Labs and its XRP as prominent members of the zombie club. Despite XRP's whopping daily trading volume of around $2 billion, Forbes contends that the token essentially exists for speculation, lacking any meaningful utility.
Not to be outdone, Ethereum Classic, with a market value of $4.6 billion, found itself under Forbes' scrutiny due to its meager fee generation, raising questions about its viability.
Even Tezos, having raised a whopping $230 million through an initial coin offering (ICO) in 2017 and now boasting a market capitalization of $1.2 billion, faced criticism for its paltry fee earnings.
Algorand, once hailed as an "Ethereum killer" for its impressive transaction processing capabilities, was not spared, with Forbes questioning the actual adoption and utility of the project despite its substantial market cap and treasury holdings.
Forbes divides these zombie blockchains into spin-offs and direct competitors to established ones like Bitcoin and Ethereum. Spin-off zombies, such as Bitcoin Cash, Litecoin, Monero, Bitcoin SV, and Ethereum Classic, collectively valued at $23 billion, are products of disagreements among programmers, resulting in new networks that supposedly lack real-world usage compared to their valuations.
The report underscores a significant disparity between the valuations of certain cryptocurrency projects and their genuine utility and usage, prompting Forbes to christen them as “zombies.”
As the cryptocurrency world grapples with these billion-dollar undead projects, it's clear that the debate over speculative value versus real-world impact is far from over.
Reflecting on the report, it seems that in the wild, wild west of cryptocurrencies, the walking dead are not just the stuff of movies, but a sobering reality, as Forbes' findings cast a stark light on the darker side of crypto success stories.
It remains to be seen whether these billion-dollar zombies will find a way to breathe new life into their utility and usage or continue to haunt the crypto landscape as specters of speculative excess.
Disclaimer: Our articles are NOT financial advice, and we are not financial advisors. Your investments are your own responsibility. Please do your own research and seek advice from a licensed financial advisor beforehand if needed.
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