Bitcoin has made a strong comeback, with premium tokens leading the way. However, last week, altcoins like DOGE or SOL overtook market leaders like BTC and ETH.
Edul Patel, CEO and co-founder of Mudrex, said that the altcoin rally had reduced the dominance of Bitcoin, whose market capitalization is now 45% of the total cryptocurrency market capitalization.
Even though Bitcoin recently underwent a correction, trading volume remains strong between $42,000 and $50,000. Of course, that is very expensive, considering the median household income for an average person, $67,521.
Edul Patel stated that if we look at an indicator called the Money Flow Index, we see that the volume and flow of money to most major altcoins has increased significantly. It is due to the growth potential of these smaller altcoins.
After the London Hard Fork update, Bitcoin and Ethereum rallied after prolonged consolidation, which resulted in a breakout for the entire market.
The primary altcoins such as ETH, DOGE or COIN gained 9 to 12 percent last week.
On the other hand, altcoins like IoTeX have gained more than 320% in the last seven days. Revain and Terra are up 78% and 62%, respectively.
Among popular names, Solana, Axie Infinity, Cardano, XRP, and Dogecoin were up 40% to 65% over the reporting period.
Sharan Nair, Commercial Director at CoinSwitch Kuber, said that cryptocurrencies are still in their infancy. There is still great potential for new entrants to make an impact.
He further added, most investors are looking for new altcoins that they believe will radically change the ecosystem. They want to invest in and have profited from them in the initial phases of investors who previously incorporated Bitcoin and Ethereum.
Investors flocking to cryptocurrencies for attractive returns have also said crypto giants like Bitcoin and Ethereum are running out of steam.
The Crypto market has many altcoins that can climb higher on the market capitalization because of blockchain decentralization capabilities.
The decentralization creates demand, which causes prices to go up significantly. In the coming months, most traders believe that these smaller altcoins will gain acceptance and market capitalization.
In addition, market watchers have said that investors are now leaning towards altcoins rather than conventional tokens as they seek early entry into new crypto projects with promise and potential.
However, new projects are undervalued. Once they reveal their potential, they will attract a lot of attraction and lead to price spikes.
For the investors who were risking everything on one endeavor, diversifying their portfolios will be compulsory for them in upcoming updates with over 7,000 cryptocurrencies to choose from for their portfolio.
Various retail investors flock to the cryptocurrency markets for quick profits, investing only in the smallest altcoins, many of which often crash.
Some of the smaller altcoins have interesting prospects as some institutional and retail investors embrace them. However, most of the investment would go into conventional BTC tokens in their initial phase of entrance into Blockchain rather than smaller altcoins.