Kaspa - The biggest gainer of 2023 that rose by 2,500% is just another Bitcoin knockoff

Kaspa price rally stunned the entire crypto market as the altcoin, within a week at the beginning of November, shot up by nearly 200%. Adding its rise throughout the year, the altcoin took the spot of the best-performing cryptocurrency year to date. But behind its massive success, there is nothing but a hollow Layer 1 project that offers nothing worthy enough to make its token a $3 billion project.

Kaspa lacks everything

Kaspa garnered attention this past month owing to its spectacular rally, but with it came critics as well. Some did not appreciate a new small-cap token rising to such heights, while others genuinely looked into the project to highlight its flaws. CyberCapital founder Justin Bons took to X, formerly Twitter, to showcase that Kaspa is not just lacking a few things; it has basically nothing that makes it a big deal.

He highlighted that Kaspa has no Turing-complete smart contracts or Proof of Stake (PoS) consensus mechanism. PoS, in a way, has become the default and the standard consensus mechanism across the crypto industry as it is not only energy-conservative but also far more secure and decentralized.

Furthermore, without smart contracts, Kaspa is simply a scalable Layer 1 chain that offers practically nothing. This is because, since the advent of cryptocurrencies, Bitcoin has been acting as a scalable L1 chain, albeit offering significantly massive scalability.

Although Kaspa stated it might bring smart contracts in the future, Bons noted that there is an issue with it as well, saying,

"Kaspa claims they will implement smart contracts in the future. But this takes the form of deploying L2s to achieve this, a terrible non-solution. This is woefully inadequate, considering the massive trade-offs  in "L2 scaling" Promises should not be taken at face value: The reason why KAS cannot directly implement smart contracts Is [sic] because of the "GhostDAG" consensus algorithm DAGs, generally speaking, are unable to maintain a reliable global state Due to branches not always converging, a trade-off for DAGs massive scalability quality.

Another key feature that the project is lacking is governance. Given the massive adoption of crypto across the globe, governance is the one true form of ensuring the decentralization of a chain. It is further important to ensure that the governance is built on the same blockchain as the project to ensure immutability. Bons added,

"With slogans like "led by the people" & "democratic" Is straight-up deceptive, as there are no robust voting systems in place at all, as I do not count Discord...

Thus, this growth needs to be justified by Kaspa and its creators, as right now, the project gave no reason as to why it should be worth over $3 billion.

Kaspa price resumes rally

Kaspa price trading at $0.1405 has noted a 22% increase in the past three days after losing a chunk of its gain from the previous rally. The altcoin was closing to flipping its bullish momentum to bearish, but last-minute recovery prevented a crash that could have brought devastating losses to its investors.

Continuing its massive year-to-date 2,587% rally, KAS is exhibiting bullish signals across the Relative Strength Index and the Moving Average Convergence Divergence (MACD).

This is key in ascertaining KAS forms fresh 2023 all-time highs of $0.1437. As long as investors choose not to book profits, the altcoin could continue growing even after marking the new 2023 highs.

KAS/USD 1-day chart

However, given how lucrative the option looks, KAS is not safe from a sudden crash caused by sudden selling among investors. Such an incident would send Kaspa price falling towards $0.1200, losing which would invalidate the bullish thesis and result in further decline below $0.1000.