Are Altcoins Dead?

Unlike in 2021, the expected 2024 bull market was a non-event. I have been in this space for 11 years, and 2024 was the first time altcoins performed so dismally. Still, some altcoins have defied the trend. It's not all doom and gloom. However, as many are realizing, a high tide no longer lifts all boats. Identifying future winners will become increasingly difficult. Strategy and due diligence now matter more than ever.

If you study coins like Polkadot (DOT) and Cardano (ADA), it's difficult not to be discouraged. After all, weren't these once some of the most promising altcoin projects after Ethereum? DOT is down about 97% from its 2021 high. That's enormous by any standards, and DOT is not alone. Over about 5 years, Avalanche (AVAX) is down an overwhelming 93%.

Shiba Inu (SHIB) is down 90%, and the list goes on. With figures like these, it's clear how many are unwilling to invest in altcoins again. As difficult as it may seem, some projects aren't down as much and, even better, have produced gains. Yes, there are actually projects in the green, and some quite heavily in the green. In some ways, this is a positive sign, as it signals maturity within the altcoin market.

The Top-Performing Established Cryptocurrencies

Under-the-radar and smaller projects can also realize enormous gains over time. This is largely thanks to their small market caps. However, looking at more established cryptocurrencies over 5 years reveals an interesting set of results. As I expected, ETH is down 50%. My view of ETH in the current cycle, however, is much more positive than in the prior cycle. Let's look at some of the bigger losers.

• Solana (SOL) – -55%

• Chainlink (LINK) – -55%

• Dogecoin (DOGE) – -65%

• Litecoin (LTC) – -73%

• Cardano (ADA) – -88%

This is, of course, not to mention Polkadot, Avalanche, and Shiba Inu, which I mentioned earlier. This is a terrible 5-year return. However, knowing when to buy can make the world of difference. Now, the winners in the same period might surprise you. As I have been saying and writing about for some time now, despite regulatory issues, privacy coins are hot property.

They embody the true value and virtues Bitcoin should have, and people worldwide are beginning to see the value in these assets. Let's take a look at some of the biggest mainstream winners over 5 years.

• Zcash (ZEC) – +560%

• Tron (TRX) – +226%

• Monero (XMR) – +126%

• Bitcoin (BTC) – +37%

• XRP – +26%

• BNB – +14%

Notice how two of the biggest winners are privacy coins, and ones I have covered in recent articles. I am a big fan of Monero, and I only wish I had kept my stack from back in the day. TRX might surprise some. However, I have been monitoring its resilience over the past two or three years. BNB, on the other hand, usually outperforms the altcoin benchmark during bear markets.

Bitcoin and XRP produced modest gains, and it's interesting to note how an altcoin like TRX can outperform Bitcoin over a period that occurred predominantly in a bear market. As I mentioned, the altcoin market shows signs of maturity. Projects are breaking away from the pack and forging their own path. We need to see more of this, as it is how specific altcoins will become grounded and truly established.

Final Thoughts

How are your altcoin investments doing? Have you been dollar-cost averaging, or are you just waiting it out and trying to survive? When it comes to altcoins, conviction is key. Never enter a position or investment without it; it's like water in a camel's hump in the desert. You are going to need it! All the best, catch you next time!

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