This bull run is largely dominated by Bitcoin and some large altcoins. The rest of the market mainly has problems and, according to many analysts, this is due to the 2.52 million different altcoins that have been put on the market. There is too much fragmentation, meaning capital is everywhere and nowhere.
Bitcoin maximalists are right
You could say that this explosion of altcoins is the thing of Bitcoin maximalists. These are people who say that Bitcoin is the only valuable currency and that the rest mainly serves as a distraction.
In the past, it wasn’t too bad in terms of distraction. Now there are millions of projects screaming for attention on Twitter and other places on the internet.
This logically causes a lot of confusion and uncertainty for newcomers, so they may choose to simply invest in the AI hype and opt for the NVIDIA share.
Especially now that the results for altcoins are particularly disappointing during this cycle.
What is also striking is that investments from venture capitalists are still relatively absent at the moment. In any case, we are nowhere near the huge peak we saw in 2021. These are always parties that create a lot of hype around their coins.
In April, 1 million tokens were born
The month of April this year definitely takes the cake in terms of creating new projects. In that month, 1 million new tokens were created.
Especially memecoins, because that is also something we see a lot in this cycle. Memecoins are doing very well and that may be due to a lack of narrative. There isn’t really a sub-industry within crypto that is very popular at the moment.
In 2021 we of course had DeFi and NFTs, but we hear very little about them at the moment. We saw some hype around AI tokens and Real World Assets (RWAs), but that didn’t really make a breakthrough either.
The fact that memecoins are so popular is probably the result of this. Actually, that is also proof of poverty. Is this really the cycle that Bitcoin maximalists will prove right?
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Source: https://newsbit.nl/creatie-van-252-miljoen-altcoins-is-desastreus-voor-crypto/
