Altcoin season is here – top coins like Bitcoin Cash, IOTA, EOS and many more explode
Over the last three days, both Bitcoin and Ethereum have entered a consolidation. For BTC, this meant trading between $39,000 and $42,000. For ETH, this meant consolidating between $1,100 and $1,250.
While some fear that this consolidation is a sign of an impending market top, altcoins have begun to break out to the upside, with BTC and ETH gains moving into other segments of the cryptocurrency market.
Earlier this week, the altcoins that rallied were all related to decentralised funding (DeFi) on Ethereum (Go to Buy Ethereum Guide). Yesterday and today, the focus has shifted from DeFi to 2017-era altcoins like IOTA and EOS.
2017-era altcoins break out
The best performing cryptocurrencies today are almost all altcoins that did extremely well in the previous bull market from 2016 to early 2018.
ZRX, the native token of the decentralised exchange protocol 0x, is up 25 per cent in the last 24 hours, on top of the 40 per cent gain it posted earlier this week.
The cryptocurrency is likely benefiting from developments and increased usage of Matcha, a decentralised exchange aggregator built by the 0x team.
IOST, MKR by MakerDAO, IOTA, EOS, Bitcoin Gold, TRX by Tron and Zcash are also among the cryptocurrencies that have risen by over 15-20 percent in the last 24 hours.
It’s worth noting that these coins had underperformed DeFi coins – suggesting that this recent price action is just a reversion to the mean.
Not all tokens rising today are 2017-era altcoins. Avalanche (AVAX) is up as much as 42 percent.
The ghostchain narrative
Behind this rally, however, is the fact that many of the coins moving up today effectively have no real adoption or even potential use.
Freddie Farmer, former head of DeFi at Wintermute Trading and industry analyst, currently comments on the matter as follows:
„The biggest shortcoming of the cycle so far is the fact that ghost chains are still listed on the stock market and are more accessible to ordinary mortals entering via the fiat ramp than high quality blue chips.“
Even today, after DeFi has seen an influx of capital and users, a vast majority of DeFi projects are trading outside the top 50 cryptocurrencies by market cap.
Analysts expect the crypto rankings to shift over time as investors begin to focus their capital on cryptocurrencies that have a fundamental purpose and/or give their holders a claim on future cash flow.