Could institutional investors start to expand the purchases of altcoins? David Olsson, Blockfi's vice president of Europe and Asia, mentioned liquidity as one of the considerations.
Certain digital assets on the market, including newer digital assets, may sometimes have a large number of volumes. Olsen explained at the CfC Moritz conference segment on Wednesday: "The question is, how long can that be sustained?" He added:
"Chainlink (LINK) is one that has held up decent volume over time, but a lot of them tend to, you know, be kind of the next greatest thing, and then fizzle out and volume disappears."
The market cap of Ethereum (ETH) is approximately $152 billion, second only to Bitcoin. Tether (USDT) ranks third at about $24 billion, while Polkadot (DOT) ranks fourth at approximately $15 billion. Lisk (LSK) ranks 100th on the list and has a market cap of approximately $186 million. From there, the market cap of thousands of other crypto assets began to fall.
Olsson said of prospective altcoins:
"So I think that, from our trading desk perspective, we really want to see kind of one-year trading history where the market cap is sort of nearish $1 billion and that it’s at least trading sort of $100 million a day in volume and that the sources of liquidity are reliable in terms of the exchanges where they’re trading."
However, the crypto industry remains skeptical, including billionaire Mark Cuban, who recently compared crypto assets to the dot-com bubble of the late 1990s and early 2000s.