In the fast-moving world of cryptocurrency, Andrew Kang, the founder of Mechanism Capital, points out a striking perspective related to the prospects awaiting altcoins. According to Kang, over 98% of altcoins have likely peaked this cycle already, whereas only a few may reach new highs during Q4 2024 or Q1 2025.
Interestingly, he noted that meme coins stand a notable chance of being among the select few to achieve new highs, albeit within a highly competitive and oversaturated market.
Kang highlighted a critical misstep often seen among crypto investors: buying too early after a market trend shifts downward. He emphasized that corrections following significant market structure breaks tend to be deeper and more prolonged than most anticipate.
It’s not enough for a few to turn bearish, with prices just 10% off Bitcoin’s highs; substantial selling pressure and widespread market exit are needed for prices to fall significantly. Kang advised that the optimal time to invest for the next cycle is when widespread liquidation occurs, the market experiences a mass exodus, and there’s a pervasive sentiment questioning the very future of crypto.
Bitcoin’s Evolution and the Fate of Altcoins
A comment by an observer, Buhlaque, suggested that Kang’s insights implied the current cycle is essentially over, making it pointless to buy anytime soon. Kang’s response affirmed this sentiment to a large extent, reiterating his belief that most altcoins have already reached their zenith for this cycle.
However, he remained cautiously optimistic about a handful of coins that might buck the trend in the near future. He also shared his views on Bitcoin, suggesting it is transitioning into a ‘supercyclish’ asset. This transformation sees Bitcoin retaining characteristics from previous cycles while increasingly behaving as a mature macro asset.
When asked about meme coins, Kang highlighted their great potential. Contrasted with the significant number of meme coins, hundreds of thousands are in circulation, he added that succeeding in this area requires extreme selectivity. This was part of their investing philosophy, where the timing and a careful selection are critical to ride out the unpredictable and volatile crypto market.
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