Fear, uncertainty, and doubt (FUD) have once again hit the cryptocurrency sector. Notable altcoins Polygon (CRYPTO:MATIC), Avalanche (CRYPTO:AVAX), and Luna (CRYPTO:LUNA) are down a respective 18.68%, 20.83%, and 21.95% in the past 24 hours, as of 2:05 p.m. EDT. They are now trading at $1.34, $37.28, and $25.59 per token, respectively.
On Sept. 6, the U.K.'s Financial Conduct Authority chairman Charles Randall criticized Kim Kardashian's promotion of a worthless cryptocurrency called Ethereum Max to hundreds of millions of Instagram followers in June. Due to altcoins' decentralized nature, "shills" have gained a significant amount of traction on Twitter promoting them with the perception of neutrality, despite securing numerous backdoor deals with developers beforehand.
The fear of a broad regulatory crackdown and lack of fundamental value sent altcoins plunging. Polygon, Avalanche, and Luna all have market caps north and south of $10 billion -- but their project developments have not yet caught up.
Polygon coin holders were excited about the network's integration with Hermez as the first-ever merger in blockchain history. However, they were clearly too excited as Hermez has a market cap of just $25.8 million -- and just how much it would benefit the Polygon network remains to be seen. But nevertheless, it is an exciting blockchain of blockchain project that allows developers to utilize its existing infrastructure to develop decentralized apps (dapps) and enable interchain communication.
As for the dapps hub Avalanche, its recent progress was not enough to curb investors' appetites. For example, even though recently decentralized exchange SushiSwap (CRYPTO:SUSHI) committed $15 million to Avalanche, and decentralized finance (DeFi) protocol Trader Joe (not to be confused with the grocery chain Trader Joe's) launched on Avalanche after a $5 million token sale, they were not enough to justify its valuation.
As for Luna, investors are concerned about its delay of the Columbus-5 mainnet upgrade from Sept. 3 to sometime three weeks later. This is a much-anticipated protocol that will allow interchain communication between multiple networks, including the network behind the Luna token, Terra. Terra is unique in that its Luna token plays a key role in regulating the Terra USD (CRYPTO:TUSD) stablecoin platform. It has seen mass consumer adoption in recent years.
Investors should note that over the long term, cryptocurrencies are rapidly gaining adoption and are revolutionizing cyberspace. Altcoins represent the forefront of innovation in this sector. New developments such as dapps and DEX were virtually unheard of a few years ago. Both markets have now grown to a staggering $156 billion and $165 billion, respectively. The lack of regulation has largely fueled this growth, and there hasn't been any crackdown on Kardashian (good luck with that) or other influencers yet, so now might be a good time to buy the dip on these promising tokens.