It shouldn’t come as a surprise that even BitCoins have novelty currencies, just like the celebratory silver coins or gold coins that most other currencies have. It is hard to do that with a digital currency, though, so instead several sites have decided to make their sites and “miners” into the novelty. Their entire service becomes “endorsed” by what they are celebrating.
That is where the problems lie though. Many of these so called Altcoins aren’t endorsed at all, they are just trying to cash in on a celebrity or something that is popular at the moment. Such was the case with the Norris Coin, which claimed to be endorsed by Chuck Norris. Norris had nothing to do with the service and before the service even launched the site was taken down and legal action was taken against the owners.
The potential customers got lucky here, as the service was removed before any transactions could take place, but others are not as lucky. Coinye West is another Altcoin company that uses what they now call a “half-man-half-fish mutant with sunglasses” which closely resembles rapper Kanye West. Late November last year, the company was struck with a Cease-And-Desist from West’s lawyers but they fought the claim. The lawyers are now threatening to take legal action against not only the company, but all who use the coins provided by Coinye.
This is a typical example of what happens when something is new and easy to make money from. We have seen this form of copying and alteratization in all forms of new products and services. Who doesn’t remember the Kickbike craze in the early noughties? One year we have over 15 million sold units from the company that invented it, the next year 15 other companies try to sell copies of the same thing.
I’m not saying it’s wrong, on the contrary, this is how new products and services gets a foothold on the world market and evolve as products and services. It follows the stages of learning: Copy, Modify, Create. The Kickbike craze eventually died down, but they are still out there. They are still being used and produced and remade and made better. I believe we are in the Copy phase of BitCoins right now and once some really smart people get a hang of it, they will start the Modify phase, where we will see the digital currency evolve to a new, improved form. After that, those same smart people will create something of their own and that’s when we will really see Altcoins take off.
We do already see some popular Altcoins that are likely to be contenders to BitCoins, such as Dogecoins, a spoof of the now popular meme Doge. However, these can only last as long as the novelty lasts, and just like the Kickbike, I believe that Dogecoins will survive, but have a very small following in the future.
Just remember this: If you are going into the digital currency market, do your own research and don’t just jump on because you think it looks cool, especially if you’re going for a less popular alternative such as “endorsed” coins or novelty Altcoins.