While Bitcoin dominated headlines in 2017 with its 1,369% rally, the real story of the year was happening in the altcoin market. Ethereum, Ripple’s XRP, Bitcoin Cash, and dozens of other alternative cryptocurrencies delivered returns that made even Bitcoin’s historic run look modest by comparison. By December 31, 2017, the altcoin revolution had fundamentally altered the cryptocurrency landscape.
Ethereum closed the year at $756.73, up from approximately $7.29 on January 1 — a staggering gain of over 10,000%. But ETH was just the tip of the iceberg. Ripple’s XRP surged to $2.30 with a market capitalization of $89.12 billion, briefly overtaking Ethereum for the number two spot. The message was clear: Bitcoin was no longer the only game in town.
TL;DR
- Ethereum rose over 10,000% in 2017, from $7.29 to $756.73
- XRP briefly claimed the #2 spot with an $89.12 billion market cap
- Bitcoin’s market dominance crashed from 90% to 38%
- 32+ cryptocurrencies reached $1 billion+ market caps
- The ICO boom and Bitcoin fork mania defined the altcoin surge
Ethereum: The Platform That Ate the World
Ethereum’s 2017 performance was nothing short of extraordinary. Starting the year at around $7-8 per token with a market cap of just $635 million, ETH ended December at $756.73 with a valuation of $73.17 billion. During the summer months, Ethereum’s market cap came tantalizingly close to “flipping” Bitcoin’s — a concept that would have seemed absurd just months earlier.
The driving force behind Ethereum’s ascent was its role as the platform of choice for Initial Coin Offerings (ICOs). Billions of dollars were raised through token sales built on Ethereum’s ERC-20 standard, creating massive demand for ETH as the base currency for these fundraising events. The ICO boom transformed Ethereum from a promising smart contract platform into the backbone of an entirely new fundraising ecosystem.
XRP’s Meteoric Rise
Ripple’s XRP was perhaps the most surprising success story of 2017. By December 31, XRP had surged to $2.30 per token with a market capitalization of $89.12 billion, briefly surpassing Ethereum to claim the second-largest cryptocurrency position. This was a remarkable feat for a token that had started the year at roughly $0.006.
XRP’s rally was fueled by growing interest from banks and financial institutions in Ripple’s cross-border payment solutions. While the broader crypto community debated whether XRP was truly “decentralized,” the market spoke with its wallet — pouring tens of billions into the token in the final weeks of the year.
Bitcoin Cash and the Forking Frenzy
The birth of Bitcoin Cash (BCH) on August 1, 2017, opened the floodgates for what would become known as “forking fever.” BCH was created through a hard fork of the Bitcoin blockchain, featuring an 8MB block size limit and the removal of Segregated Witness. After launching at around $200-300, BCH ended the year near $2,430 — a massive return for a coin that was essentially given away for free to Bitcoin holders.
The success of Bitcoin Cash inspired a wave of imitators. Bitcoin Gold launched shortly after, promising a GPU-mineable alternative to Bitcoin, though it was mired in controversy over a pre-mine. By year’s end, several more Bitcoin fork projects were announced, each hoping to capture a slice of the Bitcoin brand and its holders’ wallets.
The ICO Gold Rush
If there was one phenomenon that defined the altcoin market in 2017 more than any other, it was the ICO craze. Billions of dollars poured into token sales, with projects raising tens or even hundreds of millions based on little more than a whitepaper and a website. Ethereum’s smart contract platform made it trivially easy to launch new tokens, and the resulting flood of ICOs created an entirely new class of cryptocurrency investors.
The numbers were staggering. According to various estimates, ICOs raised somewhere between $3.5 billion and $5.6 billion in 2017 alone. Some of the most successful token sales of the year included Filecoin, Tezos, and EOS — though Tezos would soon be engulfed in lawsuits and governance disputes that underscored the risks of this unregulated fundraising model.
Bitcoin Dominance Crumbles
Perhaps the most telling statistic of 2017 was the collapse of Bitcoin’s market dominance. At the start of the year, Bitcoin commanded roughly 90% of the total cryptocurrency market cap. By December 31, that figure had plummeted to just 38%. The total cryptocurrency market capitalization had exploded from $17.7 billion to over $585 billion — and most of that growth came from altcoins, not Bitcoin.
Over 32 cryptocurrencies boasted market caps above $1 billion by year’s end. Litecoin traded around $253, and the broader altcoin market encompassed 1,368 different digital assets. The crypto landscape had become genuinely diverse for the first time.
Smart Contracts and DeFi’s Early Roots
Beneath the headline-grabbing price numbers, 2017 also laid the groundwork for what would eventually become decentralized finance (DeFi). Ethereum’s smart contract capabilities were being explored for everything from prediction markets to decentralized exchanges. Projects like MakerDAO (which would launch its stablecoin in late 2017) and early DEX protocols were beginning to sketch out a financial system that didn’t need banks or intermediaries.
While DeFi wouldn’t become a mainstream term for another two years, the building blocks were being assembled in 2017. The combination of Ethereum’s Turing-complete smart contracts, the ERC-20 token standard, and the massive influx of developer talent created a fertile breeding ground for financial innovation.
Why This Matters
The altcoin explosion of 2017 was more than just a speculative bubble — it was a proof of concept that the cryptocurrency market could support a diverse ecosystem of projects with different purposes and value propositions. Ethereum demonstrated that blockchain technology could go far beyond simple value transfer, while XRP and Bitcoin Cash showed that there was room for competing visions of what cryptocurrency should be.
However, the excesses of 2017 — the ICO mania, the questionable forks, the projects that raised millions on hype alone — would come back to haunt the market. The regulatory crackdowns that followed in 2018, combined with the inevitable price correction, would wipe out the majority of altcoins that had been created during this frenzied period. The survivors, though, would emerge stronger and more resilient.
As 2017 drew to a close, one thing was clear: the cryptocurrency market would never again be just about Bitcoin. The genie was out of the bottle, and the altcoin revolution was here to stay.
Disclaimer: This article is for informational purposes only and does not constitute financial advice. Cryptocurrency investments carry significant risk. Always do your own research before making investment decisions.
$7 to $756. my 2017 eth bag is still my best trade ever. everything since has been trying to recreate that high
XRP briefly flipping ETH for #2 spot was the most 2017 thing ever. $89B market cap for a pre-mined token
the ICO boom created so much demand for ETH. billions raised, most of it vaporware. EOS alone raised $4B
32 coins above $1B market cap by december. i had a spreadsheet tracking them all. most are dead now