The shaking of Bitcoin’s dominance as the most valuable cryptocurrency by market cap last year could pave the way for more gains for altcoin projects, according to industry experts. So, which cryptocurrencies are experts pointing to? Here are the analysts’ comments…
Bitcoin’s dominance in the ecosystem declines
Bitcoin’s total share of capital invested in cryptocurrencies fell from 70 percent at the beginning of 2021 to 39 percent at the end of the year. Investments have been directed towards altcoins, that is, all cryptocurrencies except Bitcoin. This is thought to be a sign that they are gaining ground in BTC as investors channel funds into tokens with utility and community appeal rather than just a speculative asset.
While there is no imminent threat that BTC will topple, even the latest data showing its dominance falling to 43 percent suggests that altcoins have a bright future as the crypto industry matures. Some analysts even predict that Ethereum, which currently has an 18.1 percent share of the total cryptocurrency market capitalization, may eventually surpass Bitcoin. This event is called “The Flippening”.
Analysts highlight these altcoin projects: Can they outperform?
Voyager Digital CEO and co-founder Steve Ehrlich said, “The market has evolved away from speculation and towards utility. This shows how mature the Bitcoin and altcoin market is.” Apart from the positive growth outlook for Ethereum, analysts include Terra (LUNA), Avalanche (AVAX), Cosmos (ATOM), Phantom (FTM), and Chiliz (CHZ) among Bitcoin alternatives that could outperform thanks to their unique qualities and growth prospects. they emphasized.
Crypto investor That Martini Guy said on March 7, “Investing in almost any good altcoin right now will yield huge profits in the future.” Smart contract blockchain Terra and its LUNA coin have gained attention as they rank just behind Ethereum in terms of total value locked (TVL) in decentralized finance. Terra currently accounts for $25.3 billion of such contracts, while Ethereum accounts for $108.17 billion.
Terra draws attention: Investors seek alternatives to ETH
Terra’s stablecoin ecosystem has been heralded as the next generation cryptocurrency because it’s easy to spend, low fees, instant payouts, and utility for cross-border transactions provides. GlobalBlock analyst Marcus Sotiriou said, “The growth of UST, the decentralized stablecoin fueling the growth of LUNA, is enormous, with UST market cap up 441 percent in the last six months. For each UST minted, an equivalent amount of Luna is burned. With a constant demand, this reduction in supply causes an increase in price,” he said.
Avalanche is a programmable smart contract platform for decentralized applications. The network has received praise from industry experts who think it offers many benefits. “Fast transactions at low cost and ease of bridging to and from Ethereum quickly made it the market leader,” Ehrlich said. It is clear that the market is looking for cheaper alternatives to Ethereum with an emphasis on ease of use and reliability.”
Avalanche and Cosmos offer many innovations
According to GlobalBlock’s Sotiriou, Avalanche can confirm transactions in less than two seconds and should leverage a planned decentralized identity solution. Sotiriou said it has a well-deserved reputation as “the fastest smart contracts platform.” On the other hand, Cosmos has been praised by some analysts for its growth potential in supporting an interoperable and scalable Blockchain ecosystem.
According to Coinbase, Cosmos and its token ATOM are the 21st most valuable cryptocurrency with a market cap of $7.8 billion. “The inter-blockchain communication protocol allows independent blockchains to communicate with each other, which I think is essential for the success of crypto as a whole,” Sotiriou said.
Will Altcoin Fantom continue to take market share from Ethereum?
Sotiriou also highlighted Phantom (FTM), a smart contract token that has risen sharply over the past year. The token started 2021 at $0.17 and closed the year at $2.25. Recently, it was trading at $1.26, down more than 63 percent from its all-time high in October. “I think the layer-1 blockchain will continue to take market share from Ethereum due to significantly lower gas fees and greater scalability,” Sotiriou said.
However, as we reported on Kriptokoin.com, Phantom’s appearance took a hit after the news that developers Anton Nell and Andre Cronje were planning to leave the project. The token has dropped more than 21 percent to its amount at the time of writing, following the announcement on March 6.
Fan tokens popularity impacts Chiliz
The popularity of fan tokens is growing with wider uptake by sports franchises. Highlights include CHZ, a token linked to marketing platform Socios.com that partners with over 120 major sports organizations, including the US National Football League, the National Basketball Association, and the European Football Association. “This is a sports fan engagement platform that enables sports and entertainment establishments to monetize their viewers,” Sotiriou said. Teams like FC Barcelona, Juventus, Paris Saint-Germain already have fan tokens and I expect the platform to gain significant hype on its way to the World Cup later this year.
Other analysts warned that the uncertainty weighing on global markets could dampen the global appetite for riskier assets. In such an environment, according to some, Bitcoin can act as a draw for investors looking for a safe haven. Tony Sycamore, APAC senior market analyst at City Index, predicts that Bitcoin will continue to dominate the market cap of cryptocurrencies by 40-45% this year.
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