Torrenting has been part of the internet lexicon for several years and is one of the most popular online file-sharing methods. Torrents were made famous by the BitTorrent (CCC:BTT-USD) platform, the leading peer-to-peer (P2P) file-sharing protocol. These days, the BitTorrent platform also offers a cryptocurrency to share files.
BTT ended 2021 with a year-to-date gain of over 800%. However, most of these gains were during the year’s first half. It’s gained only 15% in the past six months, which is a testament to its murky prospects.
In essence, the exchange of BTT for faster download speeds is simple economics. As the service scales, the proposition can become more attractive over time. However, most investors won’t likely be too excited about the crypto when there are many other options to choose from. BTT has limited use cases, so I expect it to attract a very niche audience.
Cryptocurrencies with multiple use-cases and utilities are the ones you should consider betting on for the long haul. Cryptos such as BTT have very limited utility and are unlikely to attract mainstream investor attention. However, it seems its makers understand that fact and are looking to build more utility for the niche crypto.
TRON, one of the leading blockchain-based operating systems, announced the launch of the BitTorrent Chain (BTTC). To attract more versatile projects and institutional interest, TRON and BitTorrent are building cross-chain compatibility.
The cross-chain protocol is built on a proof-of-stake mechanism. Moreover, the chain will be compatible with Binance Smart Chain, TRON, and Ethereum (CCC:ETH-USD). Consequently, the chain will enable the transfer of assets decentralized among the networks mentioned above.
Cross compatibility allows several blockchains to communicate without intermediaries. Hence, blockchains can transfer assets despite their homogeneity. In the past, blockchains couldn’t communicate with each other, making it impossible to enjoy the benefits of the technology.
Outlook on BitTorrent
The crypto market has come of age in the past couple of years, outperforming the major financial markets. With so many cryptocurrencies trading at this time, it’s easy to get lost and distance yourself completely. However, for me, cryptocurrencies with robust fundamentals, diverse use-cases, and an able management team pique my interest. Unfortunately, BitTorrent doesn’t pass the litmus test for me.
For starters, the platform has had a shady reputation from its inception. For the most part, BitTorrent has been a controversial platform that has invariably had a major role in facilitating piracy. As it’s difficult to determine the legality of the torrent files being shared, several countries have banned the platform entirely.
Moreover, the man behind the BitTorrent acquisition and founder of TRON, Justin Sun, has also had a similar reputation. The Chinese uber-millionaire has been criticized for regurgitating Ethereum’s white paper, bidding millions for a pretentious lunch with Warren Buffett and giving away Tesla (NASDAQ:TSLA) cars as a publicity stunt.
Nevertheless, if we set aside these factors, the BitTorrent platform boasts over 100 million monthly active users. As the platform scales, BitTorrent could become more valuable over time. However, as my colleague, Alex Sirios, pointed out, most investors wouldn’t be too excited about the prospects of being a power sharer on BitTorrent.
BitTorrent is popular as a P2P file-sharing protocol, and its cryptocurrency offers some interesting integration with that protocol, but as it stands, BTT is niche crypto with limited real-world utility. Hence, it’s not an attractive proposition for any long-term crypto investor at this time until it offers a diversified set of use-cases.
On the date of publication, Muslim Farooque held a LONG position in Ethereum. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
Muslim Farooque is a keen investor and an optimist at heart. A life-long gamer and tech enthusiast, he has a particular affinity for analyzing technology stocks. Muslim holds a bachelor’s of science degree in applied accounting from Oxford Brookes University.