Big Altcoin returning a thing of the past? Analysts speak out

The cryptocurrency market, renowned for its volatility and high stakes, has always held a particular fascination for altcoins. These assets, emerging in the shadow of Bitcoin [BTC], offered the lure of massive returns. Bitcoin, for example, saw a slight decline and was trading at $65,700. However, recent market trends indicate that the era of extraordinary altcoin gains may be coming to an end.

Declining Altcoin Prospects

Altcoins are increasingly seen as high-risk investments with diminishing chances of significant returns. Markus Thielen, head of research at 10xResearch, reflects a widely held view among crypto analysts. He said,

“Even if tactical opportunities exist, the era of 100x returns may well be behind us.”

This skepticism about the current dynamics of the altcoin market is widely shared within the community. Thielen points out that the expected altcoin bull market has not materialized in any significant way. The lack of substantial retail engagement and the scarcity of innovative new projects have reduced the enthusiasm that once drove altcoin investments. He further notes,

“…retail participation remains moderate and few new projects have emerged that captivate non-crypto-native traders.”

Characteristics of Past Bull Markets

In the past, altcoin bull markets were driven by compelling narratives and large capital inflows. These are thriving thanks to the promise of blockchain technology which is revolutionizing traditional financial systems. However, Thielen observes that the current cycle lacks these strong narratives. Tight capital conditions are evident in the low total value locked in decentralized finance [DeFi] projects.

Also read: Cryptocurrency: 3 coins to capitalize on now for solid gains

High risk perception

Michael van de Poppe, a renowned analyst, adds to the cautious outlook by highlighting the risks of holding a portfolio heavily weighted in altcoins. In a recent X post, the analyst shared his personal experience of significant losses. He added,

“What’s the downside to this bet?” It’s relatively huge. At the time of publishing, I have already lost around 20% in 1-2 weeks on the overall investment.

The altcoin market is going through a difficult phase where high-risk bets are becoming less attractive due to the lack of compelling narratives and large capital inflows.

Also Read: Beyond WIF, SHIB, and XRP, This Coin Dominates 24-Hour Trading!

Fuente