The crypto market experienced a slow expansion in the first quarter of 2024. Bitcoin reached a new all-time high close to $75,000, but altcoins moved in different scenarios. Some assets reached all-time highs within weeks, while others extended their long period of sideways trading.
By looking at the list of smaller assets, traders may find value in unique, riskier assets that could yield high returns.
“Altcoin season” is still a thing in crypto, and traders are watching for this scenario to unfold in 2024.
The exact details of the next bull market are unknown, and some categories may have stronger performers. But the overall expectation takes into account the usual rally of altcoins following each Bitcoin all-time high.
Another Dip Before Full Send?
The altcoin boom pattern may not play out smoothly without some turbulence. One possible scenario is a price dip, which would extend the period of accumulation. Money inflows from Tether (USDT) are also a key indicator of an altcoin bull cycle. In previous market booms, Tether spending proved to be the main booster of altcoin performance.
In 2024, Tether introduced more than 110B USDT in circulation. In the current bull cycle, there are more assets to go around when the most active stage arrives for altcoins.
Have Altcoins Capitulated?
Some of the hottest assets from previous bull cycles now have significant losses. Networks like Stellar (XLM) are down nearly 87% from their all-time high, close to a capitulation-level loss. Changed regulations, new assets, and a new type of buyer may mean older blue chip coins may not return.
Former star tokens include Algorand (ALGO), Aave (AAVE) and Hedera (HBAR). There are also several categories that are still drifting sideways. Game and play-to-earn tokens are now settled at a low baseline, awaiting their next move. A powerful bull market could lift assets like Axie Infinity (AXS), The Sandbox (SAND) and ImmutableX (IMX).
One of the categories to benefit quickly from bullish moods are the native exchange coins and tokens. Binance Coin (BNB) holds strong above $600, but a bull market could take up OKX and KuCoin (KCS) to higher positions.
Special-Interest Tokens Remain a Challenge
In the past two years, several batches of special-interest tokens came to the markets. It was not unusual that those tokens went through a fast boom-and-bust cycle. But some managed to hold on, potentially drawing in renewed investments.
AI tokens were one of the big trends, as there were both new assets and rebranded older tokens from the previous token sale boom. The AI token valuation is only growing, and there is a cross-over between projects dealing with data science, or tokens tied to generative AI.
Telegram bot tokens remain in the niche, with a total market cap under $1B. Some of those tokens are risky and illiquid, so traders may prefer Telegram (TON) as a direct investment.
Web3 tokens include projects that build infrastructure for distributed apps. Those networks aim to provide tools for cheap, speedy transactions. Web3 tokens may benefit in 2024 from sub-project launches, meme tokens, NFT collections and distributed apps that use their technology.
Altcoins will have disparate narratives during the current bull cycle, but traders may be ready for multiple tokens to go vertical during the most active phase of the market.
