We asked ourselves one question again and again: Wen altcoin szn?
Frankly, David has done a very good job of preparing what is needed to see the start of the next altcoin season. But to get some clarity on how optimistic people should be, I turned to HashKey’s Jupiter Zheng.
Zheng and David are on the same page when it comes to when we might see the next altcoin season, and HashKey puts together a report on why the team is so bullish on altcoins right now.
Part of this is due to the possibility of peak Bitcoin dominance, which, as you know if you’re a regular Empire reader, is one of the necessary ingredients for altcoins to take off.
Once we get Bitcoin dominance above 60% or even 65%, Zheng expects a “massive altcoin season” to begin. BTC dominance currently stands at 61.64%.
Zheng highlighted three areas of success that he is watching: Ethereum, Solana, and some tokens in DeFi such as UNI and SKY (formerly MKR).
Let’s start with Ethereum, especially since it seems like more and more people are jumping off the train right now.
According to HashKey, there are three factors that are bringing Ethereum down: increased competition (duh), cost drift, and declining transaction fees.
“The Ethereum community is currently developing metrics to measure “Ethereum consistency” and it is expected that best practices will emerge from these efforts that will further consolidate the Ethereum ecosystem and ensure long-term success,” the report states.
As for Solana, it is a “big fundamental play” in contrast to Ethereum’s role as a “problem play.”
“Solana has achieved a lot this year, and – compared to Ethereum – Solana is a bit centralized but very efficient. So, Solana is strong in its operational capabilities. Ethereum is more focused on the technological… technical layers, decentralized layers and security layers, but Solana is more focused on how to achieve mass adoption,” Zheng explained to me.
And on top of that, Zheng believes that this will be the next coin to be chosen for ETFs after ETH and BTC funds.
In conclusion, “many DeFi projects from the last cycle have gradually become core infrastructure and crossed cycles to form the ‘essential’ landscape,” writes HashKey.
But it’s not all bullshit and dreams; there are a few things Zheng isn’t so optimistic about.
For example, Layer-2. There can be a lot of them that investors can focus on. And even beyond that, only “the top 5 or top 10 will be valuable,” he explained.
To solve this problem, he has a suggestion: “If we try to select the best 2 layers out of 100 [on offer]It’s quite difficult, so maybe just pick the best ones, just like we picked the Magnificent Seven in the US stock market.”
Who wants to choose a name?
