You could make the argument that if all of the capital in crypto only had to be spread across 50 coins that that would make each of those coins extremely more valuable. In light of that thought, is the huge variety of Altcoins ultimately a good or bad thing for crypto?
Actually I think that things would not change so much, because currently the top 20 of the market occupies 90% of the marketcap, and the remaining 2,118 cryptos are taking that small slice of 10%. So if we proportionally distribute that capital between the top-20, the increase in price would be just 10%, something very small compared to the large pumps that can be observed frequently in this volatile market.