Author: Nancy, PANews
As the secondary market gradually recovers, the crypto ecological structure is undergoing subtle changes, and market liquidity is gradually withdrawn from on-chain activities. In the bull market atmosphere, many projects have accelerated their efforts to launch their own tokens in an attempt to attract more capital and user attention. At the same time, the recent strong performance of crypto projects in multiple sectors has further stimulated investment sentiment. The market's expectations for the "altcoin peak season" have become stronger, and many have begun to look for crypto assets with potential.
DeFi and L1 have become the mainstay of currency, and the token allocation strategy is ushering in optimization and adjustment
In recent times, the encryption market has welcomed multiple projects announcing the issuance of tokens. PANews has counted 21 crypto projects that have recently officially announced TGE. These projects cover DeFi, L1, NFT, L2 and DAO and other tracks. Among them, DeFi and L1 projects are the main currency issuance, and nearly half of the projects come from these two games. road.
Judging from public information, these projects are generally favored by the capital market, with a cumulative financing amount of more than 620 million US dollars, involving investors including Polychain, Binance Labs, Coinbase Ventures, Dragonfly, Wintermute, Alliance DAO, GSR and DeFiance Capital and other well-known institutions. VC endorsement is often regarded as an important symbol of project reliability and potential, adding more reliability and potential to these projects.
However, while capital is involved, the previous continued decline in currency prices caused by high FDV and low circulation has gradually triggered strong dissatisfaction and controversy in the market. Faced with this dilemma, the market's attention began to shift significantly, including the shift to relatively fair and decentralized crypto-assets, such as MEME coins. For example, 10x Research recently released a report stating that the Google search trend for “Meme Coins” hit a record high, exceeding the previous peak in March 2024. This data also confirms that investors at this stage are relatively more interested in community-driven and more fair investment opportunities.
From the perspective of token distribution, many projects have begun to adjust to the previous problem of low initial circulation to avoid the dilemma of limited sustainable upside caused by high FDV. For example, Movement’s initial circulation reached 22%, Side Protocol’s was 22.9%, Zircuit’s was 21.95%, etc. This change reflects the market’s reflection on the low-circulation, high-FDV model. Especially in such projects, ordinary investors often become “victims” of liquidity withdrawals.
Not only that, the token distribution strategy also pays more attention to ecosystem construction and community participation. For example, Bluefin will allocate 52% of the total token supply to ecosystem growth, Movement will allocate 40% of the total token supply to the ecosystem and community, and Magic Eden will allocate 37.7% of the total token supply to the community and ecosystem. , Usual distributes 90% of the tokens to the community, etc. Such a strategy can help enhance the community cohesion and market competitiveness of the project, and better launch the long-term development of the project.
Especially in terms of airdrop intensity, the average token airdrop ratio of these 21 projects reached 14.9%, among which Suilend, Hyperliquid, Zircuit, Swan Chain and WalletConnect reached 40%, 31%, 21%, 20% and 18.5% respectively. Significantly exceeding the average, especially Hyperliquid, with an airdrop value of up to US$28,500 per capita, becoming one of the crypto projects with the largest airdrop this year. As an effective means of attracting and motivating community members, airdrops still play an important role in project promotion. They not only provide generous returns to early supporters, but also effectively increase the influence and popularity of the project.
Many factors may help altcoins return during the peak season, but we cannot rely solely on Bitcoin’s driving effect
The intensive announcement of currency issuance by crypto projects is closely related to reasons such as the market rebound and the loose policy environment in the United States. Recently, as Bitcoin continues to rise, mainstream public chains, DeFi, Metaverse, L2, games and other sectors have experienced a strong rebound. At the same time, the PVP competition in the MEME market has intensified, which has also discouraged many players, and the market attention has gradually begun to turn to the secondary market.
“The altcoin season may be about to begin,” top trader Eugene said not long ago.
According to the latest report released by Bitfinex, the overall crypto market has reached a new cycle high, and the market capitalization of altcoins is now close to the high of $984 billion in May 2021, showing that speculative funds are shifting from Bitcoin to altcoins. Historically, this rotation of funds has typically heralded the arrival of “altcoin season,” when altcoins experience more prominent gains relative to Bitcoin. Crypto analyst Mikybull Crypto said that Bitcoin’s dominance in the crypto market has fallen below its two-year support line, which may indicate that the market has “officially entered the altcoin season.” Because Bitcoin’s declining dominance means investors are profiting from their BTC positions and investing some of their funds in altcoins.
QCP also pointed out that the recent decline in Bitcoin’s market value reflects the trend that funds may gradually shift from BTC to ETH and other altcoins. According to data revealed by IntoTheBlock, November hit the highest level of net outflows of CEX stablecoins since April, at about $4.5 billion. Coupled with strong price performance, it shows that traders are locking in profits, and these funds may be redeployed into altcoins or as reserves for future declines.
Not only that, as the encryption market gradually moves towards the mainstream, the loose encryption policy environment in the United States has also stimulated market optimism about the development of the overall industry including altcoins. According to previous reports by PANews, the list of Trump’s new government members has been gradually revealed recently, and many of them have publicly expressed their friendly attitude towards cryptocurrency, which may bring more positive policy expectations to the industry. In particular, the upcoming departure of U.S. SEC Chairman Gary Gensler is a change that is believed to provide more room for further development of the crypto industry. What’s more worth mentioning is that with the ETF applications for currencies such as Solana, XRP and LTC, the market’s expectations are getting higher and higher.
However, CryptoQuant CEO Ki Young Ju also pointed out that compared with the previous bull market, the current rise in Bitcoin is mainly driven by the demand from institutional investors and spot ETFs. These funds are different from cryptocurrency exchange users and have no intention to transfer assets from Bitcoin. Move to altcoins. At the same time, asset rotation becomes less likely as institutional investors primarily operate outside exchanges. Although institutions may allocate mainstream altcoins through investment tools such as ETFs, small-market altcoins still rely on exchange retail users. For the total market value of altcoins to reach a new high, a large amount of new funds will need to flow into exchanges, but the current level below historical highs shows that the liquidity brought by new users is reduced. Therefore, altcoin projects should focus on developing independent strategies to attract new funds rather than relying on the potential power brought by Bitcoin.
(The above content is excerpted and reprinted with the authorization of our partner PANews, original text link)
Statement: The article only represents the author's personal views and opinions, and does not represent the objective views and positions of the blockchain. All contents and opinions are for reference only and do not constitute investment advice. Investors should make their own decisions and transactions, and the author and Blockchain Client will not be held responsible for any direct or indirect losses caused by investors' transactions.
"Is a new round of "airdrop wave" coming? These 21 projects are expected to "distribute big money". This article was first published on (Block Guest).
