Analyst Predicts This Bitcoin Cycle Could Be The Final Opportunity for Altcoins – Decrypt
The era of earning significant profits from lesser-known memecoins during a cryptocurrency bull market may be coming to a close, as per lead Glassnode analyst James Check.
Check, an expert in on-chain markets, suggested on Tuesday that a large portion of young Bitcoin holders could now be holding substantial amounts of money that they are less inclined to risk on more volatile assets.
He stated on Twitter, “Folks are increasingly hesitant to invest in low-quality coins as they know they can succeed by simply holding onto Bitcoin. They dabble in meme coins from time to time, but only to the extent they would bet on a sports game.”
According to Check, the main demand for “shitcoins” until now has come from “millennial crypto natives,” who are transitioning from trying to “get rich” to focusing on “staying rich” in their financial journey.
Lookin evidenced by various surveys indicating that individuals aged 18 to 40 are more likely to own and support cryptocurrencies. For example, a survey by Grayscale found that 62% of Gen Z believes crypto is the “future of finance.”
Despite this, the analyst believes that the investment community has become more discerning since the last bull market and can differentiate between winners like Bitcoin and altcoins that lack serious demand.
Therefore, holders of altcoins may struggle to find buyers for their speculative tokens.
Check wrote, “We may be approaching the end of altcoins. Millennials and Gen Z are trying to convince the next generations to purchase their altcoins, much like how boomers convinced them to buy overvalued houses.”
Although the analyst’s latest theory has yet to materialize, memecoins without clear utility, such as DOGE, SHIB, PEPE, and WIF, saw significant surges as Bitcoin surged earlier this year following the introduction of US spot ETFs.
This phenomenon, known as the “wealth effect,” is often discussed by Bitwise CIO Matt Hougan. As long-term holders of Bitcoin profit from the increased demand for BTC, they feel more comfortable taking risks with their earnings, leading to a surge in altcoin prices.
Since altcoins have lower volume and market caps compared to Bitcoin, even a small inflow of funds can result in a significant price increase for these assets, as noted by Hougan.
Check has also frequently highlighted the profit-taking behavior of long-term Bitcoin holders, indicating a pattern seen in previous bull markets.
As of early May, long-term Bitcoin holders appeared to be hodling again, with Check suggesting that they would need higher prices to consider selling their holdings.
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