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Altcoins on Top, But Meme Coins Are Set to Rise: Here’s Why
After rallying in Q1 2024, most altcoins seem to have peaked. They are struggling significantly from their March 2024 highs, with declines in value ranging from 70% to 90%.
According to the latest data, the total market capitalization for cryptocurrencies, excluding Bitcoin and Ethereum, has fallen to the levels of December 2023. This regression has effectively erased all the gains made since the beginning of the year.
Why Cryptocurrency Analysts Believe Meme Coins Can Still Reach New Highs
Cryptocurrency investor Andrew Kang believes that almost all altcoins have reached their peak for the current bull cycle. However, he maintains a positive view on meme coins, which could challenge the broader bearish trend in the market.
“I believe 98%+ of altcoins have peaked in the cycle, except for maybe a handful of coins that could reach new highs in Q4 2024/Q1 2025. Memes probably make up the majority of coins that have a chance of reaching new highs,” Kang revealed on X (Twitter).
To know more: 7 Trending Meme Coins and Altcoins in 2024
Contrary to the faltering performance of most altcoins, meme coins are showing a peculiar resilience. Meme coin expert Murad Mahmudov predicts that The sector will dominate the next altcoin season.
“People are slowly waking up to the black pill that all altcoins have always been meme coins with some tech obfuscation on top. This will lead tens of thousands of people to (1) Sell tech altcoins for pure memes, (2) Buy pure memes instead of tech altcoins with fresh fiat in this cycle,” Mahmudov boldly said. observed.
Mahmudov’s analysis suggests a shift in investor sentiment. Institutional investors are largely focused on Bitcoin (BTC) and, to a lesser extent, Ethereum (ETH)while retail investors tend to prefer meme coins.
“This is why tech altcoins are underperforming. Nobody wants them,” Mahmudov noticed.
Additionally, data from cryptocurrency analytics platform DYOR highlights the outperformance of meme coins over the past 90 days during the market volatilityWith a relative strength of -0.37, meme coins have shown remarkable resilience compared to sectors such as Web3 gaming and Layer-2/Layer-3 technologies, which have seen much lower strengths of -1.32 and -1.30, respectively.
Relative strength measures the performance of a particular sector relative to the broader market.
Relative Strength of Cryptocurrency Narratives. Source: GAME
Hitesh Malviya, founder of DYOR, provided a critical view of the altcoin ecosystem, particularly those backed by venture capitalists (VCs). He argued that many VC Funded ProjectsDespite their initial promise, they often do not survive in the long term.
“90% of these so-called high-end VC-backed projects are essentially white-collar scammers who promise shiny things, raise money, run the project for three or four years, and then die,” Malviya explained.
This scheme, Malviya warns, typically benefits founders and VCs financially, while leaving retail investors at a loss. Malviya’s observations highlight the need to focus more on community-aligned altcoins.
To know more: Crypto Scam Projects: How to Spot Fake Tokens
“If we fail in this, the community will continue to trade meme coins, which is not good for most of the community, as the greed factor is always high and there is no fundamental support,” Malviya concluded.
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