According to the analyst, the altcoin market needs a significant price rally if crypto projects want to continue receiving healthy amounts of venture capital.
Unless altcoins have a “significant bull market,” fewer projects will be funded, leading to lower valuations across the altcoin market, Reflexivity Research co-founder Will Clemente said in a September 12 post on X.
Clemente predicts “dispersal” of funds
But Clemente doubts the altcoin market will achieve that bull run.
“With the amount of supply pouring into the market, I expect a fragmented landscape and don’t believe this will happen,” Clemente wrote.
Altcoin market dominance excluding top 10 cryptocurrencies has dropped 23.1% in the past 6 months | Source: TradingView
CoinMarketCap says it tracks more than 8,000 cryptocurrencies and that it is difficult to determine the “exact number” of tokens in existence.
Clemente explains the large investments in altcoins – considered high-risk, high-reward assets – are failing to meet market performance standards.
“What I mean is that too much money has been given to funds that are currently underperforming the benchmark by allocating a large portion to beta.”
This comes as traders and analysts question whether the altcoin market will see a similar rally as previous market cycles?
Glassnode chief analyst James Check argues this will not play out as expected as new traders rush to buy the most speculative asset too early.
“The joke has been told, everyone knows it, and they jump at it, but it’s not funny anymore,” Check said on the Rough Consensus podcast that aired on Aug. 29.
Other analysts remain optimistic
Other traders, however, are more bullish on the altcoin market.
“Some specific coins are doing well, and we are starting to see some momentum,” MN Trading founder Michael van de Poppe wrote in a Sept. 12 post on X.
“I don’t think September will be worse. I think we will gradually accelerate from here,” van de Poppe added.
“Altcoins are undervalued. I’m buying,” added trader Mister Crypto.
Source: Mister Crypto
Meanwhile, Bitfinex analysts explained that altcoins remain relatively strong despite Bitcoin's recent downturn, suggesting that investors may be adjusting how they protect their capital during times of market volatility.
“This shift hints at a potential regime change as investors are discovering value in altcoins, unlike the typical pattern of flocking to Bitcoin during a downturn,” analysts said on September 9.
https://tapchibitcoin.io/altcoin-can-thi-truong-bo-dang-ke.html
