- Tether cofounder William Quigley said there’s no real reason for the recent surge in altcoins.
- Some have put it down to the boom in DeFi and NFTs, but Quigley told Bloomberg that it’s just hype.
- Solana has jumped 250% over the last 30 days, while cardano’s ada has become the third-biggest cryptocurrency.
- See more stories on Insider’s business page.
The cofounder of top stablecoin Tether has said there’s no fundamental basis for the surge in altcoins that has pushed up solana more than 250% in 30 days, except for hype and speculation.
Altcoins have rallied sharply over the past couple of months, with cardano’s ada shooting up the crypto league table to become the third-biggest token by market cap. Others, such as binance coin and XRP, have also seen their prices jump.
Some analysts have said that the rally is tied up in the boom in non-fungible tokens and decentralized finance. Solana, for instance, is a blockchain and token that can support NFTs and DeFi applications.
Yet on Sunday, Tether cofounder William Quigley told Bloomberg that “there’s no real reason” for the surge in altcoins. Tether is a crypto stablecoin designed to track the US dollar, and it is the fourth-biggest token.
Read more: A research analyst at a $2 billion crypto firm lays out the bull case for polkadot that most investors are overlooking – and shares why cardano’s ada is looking overvalued after a stellar run
Asked about the altcoin rally, he said: “So something is percolating for a while. And then for reasons I never understand, attention focuses on it and suddenly people pile in. That’s the speculative aspect of this.
“I’ve been doing this for a long time. Doing fundamental analysis on something like that is very, very hard – because there’s no real reason. It becomes part of the zeitgeist. And people are excited about it, and it goes up.”
Quigley’s view is shared elsewhere in the market. JPMorgan’s crypto expert Nikolaos Panigirtzoglou told Insider last week that the rally doesn’t look sustainable, because it’s driven by unrealistic expectations about the tokens.
He questioned whether there will be “enough traffic in these networks [and] wallet addresses to justify these kind of valuations.”
Panigirtzoglou was responding to the idea that tokens such as solana and cardano’s ada will challenge ethereum and become widely used in the world of NFTs and DeFi.
NFTs are a booming asset class of crypto collectibles and artworks, and DeFi is the use of crypto technology to remove the need for middlemen in financial contracts.