Altcoins Underperforming Against Bitcoin This Cycle
On Friday, Crypto analyst Miles Deutscher an interesting fact about the crypto market. Since November 2022, just eight altcoins have broken their previous ATH against the flagship cryptocurrency.First, the analyst considers that asset selection dynamics changed from previous cycles. Investors have been “punished” for being overexposed to certain sectors like L2 and gaming and “rewarded” for participating in others like Memecoins and AI.
In contrast, in the last cycle, “you could basically bet on anything and beat $BTC.” According to the analyst, the market will likely continue experiencing specific sector outperformance despite the retail liquidity injection. He also explained that “crypto is an attention economy,” and money will flow where attention is. As a result, even the projects with the best technology won’t perform if there isn’t an exciting reason to buy.More Room To Catch Up
The analyst’s third point explains that the bull run has been led by Bitcoin and spot BTC exchange-traded funds (ETH). Based on this, he considers it unsurprising that altcoins have “hardly pumped” so far.Various crypto analysts and experts share this opinion. Alex Krüger previously stated that the cycle has been “almost entirely” driven by the Bitcoin ETFs’ momentum.
Deutscher sees Altcoins’ underperformance as a bullish signal since Bitcoin’s dominance has been instrumental in previous cycles. To him, this performance allows “more room to play catch up” and could drive altcoins to unseen highs.The analyst believes the market needs another catalyst for a true Altcoins season. Despite this, he highlights that many investors have had a record Q1 “even in mildly bullish conditions for most alts.”
Ultimately, Deutscher considers there is still room to make big profits this cycle “even without the face-melting altseason we all crave.”