Thread by @jdorman81

It's time to stop waiting for an "alt season" - that lazy term needs to be retired. The crypto market is WAY more developed now than it was in 2017 or prior, and the notion that a rising tide will lift all boats should not, and most likely will not, happen.

1) A thread on why:

2) Disclosure: I mention specific tokens as examples to make my case, of which @arca holds positions in some. I recognize many will disagree with which tokens belong in which categories, and I respect your opinion. My point is about differentiation; not which token fits where.

3) As markets develop, the individual components of the market begin to separate into "Haves" and "Have Nots". "Haves" are those tokens that have delivered or have great promise; "Have Nots" are those where a majority of the world has flat out given up on due to lack of progress

4) "Have Nots": Stellar $XLM & $RHOC are examples of "have nots", where the team hasn't created any value propositions and the market has left it for dead. Both can potentially become a "Have" again with clear progress, but the token should not move just because of an "alt run".

5) For those in the "Haves" bucket, this is different than 2017. In 2017 and prior, EVERYTHING was pure speculation. Few, if any, protocols, projects or companies were close to developing a worthy MVP or a clear-cut value prop. The playing field was equally new & moved together

6) In 2019, the market can now more easily differentiate between projects that solve a real problem, and can deliver a worthwhile product, versus those that don't. These tokens fall into sub-categories based on perceived ability to create & capture value --> price should follow.

7) These sub-categories may include:

A) Undisputed leader
B) Clear-cut value proposition
C) Essential projects, but token has unclear value
D) Huge networks / communities -- may deliver massive value (or may not)
E) Live, working products but still speculative
F) Pure spec

8) A: "Undisputed Leaders" - there may only be one in this bucket currently; Bitcoin (BTC). $BTC has transcended crypto and is now in mainstream media, economics, finance & politics. There is no denying its importance, and while it may still fail, it is miles ahead of the pack.

9) B: "Clear-cut value" - These tokens can easily be modeled & valued, and while people can disagree on price, no one can argue that they do accrue economic value. Examples are $BNB, $LEO, $ALGO (including the put), $MKR.

10) C: "Essential, but unclear token value" - These projects are incredibly important to an ecosystem, often more important than those in category B, but the value proposition of the token remains unclear or murky. This includes $ETH, $ZRX, $BAT, $REP, $LINK, $ATOM, $VET

11) Category C tokens should still do well in a bull market, because they are leaders in their fields, but it still remains to be seen just how much value can and will ultimately accrue to the token. The market should reward these anyway while patiently waiting for clearer value.

12) NOTE: I'm not trying to pick a fight with those who own category C tokens above. I respect your different opinions. These are simply examples of tokens where the protocol or project is absolutely not going away, but IMO, the tokens may never capture the value of the project.

13) D: "Huge networks" - These protocols/systems are hard to bet against b/c they are live, the community is massive, & they often have stockpiles of cash. They may or may not deliver, but they will benefit simply as "call options" w/ plenty of time/money to deliver value later.

14) Category D tokens include $EOS, $TRX, $XRP, $NEO, T-Zero, $XTZ. This group stirs the most debate, as community fervor & unwavering belief may trump reality, but also can't be refuted because it's too early. These may rally more than C b/c upside is higher, but so is downside

15) E: "Live, working products" - This is where the "alt season" debate really dies. There is absolutely ZERO reason why speculative alt coins that have delivered nothing to date should benefit anywhere near as much as those that have delivered a working product.

16) Category E tokens include $FOAM, $MANA, $HXRO, $FXC, and soon $LINK. There are many others as well. Category D tokens can be very bifurcated -- once a live product exists, if the market decides it's not relevant, these can quickly move to the "Have Not" bucket (i.e. $STEEM).

17) At this critical juncture in crypto's future where doubts still remain about viability, those with working products should benefit many fold over those that do not. If token prices don't appreciate, this suggests the product isn't that good, or can't accrue token value.

18) With traditional startups, once a company generates revenue it will be valued based on revenue projections/multiples, whereas before, it was valued purely on hype. Same applies to Category E. Once your product goes live, you get valued on merit not hype.

19) F: "Pure spec" -- If i'm right that alt season will never happen, you may still see intra-day/week jumps in speculative tokens that have made no progress, but this is pure short-term gambling. Over longer-time periods, these will likely massively underperform.

20) And unlike 2017, when everything rose/fell together, those that choose to commit capital to pure spec tokens will realize the massive opportunity cost of not using that same capital to purchase Categories A-E instead.

21) The 2009 equity recovery is a great parallel. Incredible companies like AMZN, AAPL, GOOGL, SBUX could have been bought for bargains, but many investors chose to buy REALLY distressed equities instead of the blue chips -- many of which never recovered & filed for bankruptcy.

22) Conclusion: It's time to recognize this asset class has matured. And when asset classes mature, returns start to bifurcate. The sooner people stop talking about a generic "alt season", the faster the real alts will actually rally.