Beating Bitcoin

Bitcoin hit a fresh all-time-high this week, and ‘alts’ are heating up as well. Notably, over 80% of tokens in the Top 150 have outperformed Bitcoin month-to-date, by an average margin of ~19%. As altcoins rally, concerns about having “missed the opportunity” tend to surface. However, on average, these tokens are still trading at just 30% of their prior all-time highs, suggesting substantial potential upside remains. In fact, only a small subset of assets are currently trading within 5% of their historical peak.

Our vision for ‘alts’ is not that every token rallies indiscriminately. This mirrors behaviors seen during the 2021 cycle - a period marked by heightened speculation, where identifying short-term “winners” often required little regard for underlying project fundamentals. The current rally reflects some of those same dynamics: memecoins and high-volatility tokens favored by speculative traders are outperforming, while sectors with more fundamental utility, such as Layer 1s and DeFi, have posted more modest gains.

Token markets will become sustainable when quality becomes the foundation for success. While we enjoy any rally after the tough run that alts have had over the last few years, we remain focused on the long-term value creation that disruptive blockchain projects promise rather than short-term price action. Against this backdrop, we continue to see meaningful opportunity in identifying the highest-quality projects building useful products and vibrant ecosystems for the long run.

The information herein is for general information purposes only, is not investment advice, and should not be used in the evaluation of any investment decision. An investment in digital assets involves a high degree of risk. Past performance is no guarantee of future results.