Altcoin
Cryptocurrencies: Investors are in danger!
8pm ▪ 3 minute read ▪ by Eddy S.
Cryptocurrency investors will face a formidable challenge in 2024. According to analysts, no less than $44 billion of previously locked altcoin tokens will be released onto the markets in the coming months. An astronomical figure that could destabilize a large number of alternative projects. Indeed, this massive influx of new cryptocurrencies into circulation threatens to crush prices under relentless selling pressure.
Cryptocurrencies: The Pitfalls of Low-Supply Altcoins
From the outset, it is clear that alternative cryptocurrencies have a significantly higher risk profile than the heavyweights Bitcoin or Ether. The reason? Many alternative tokens deliberately choose to start with an abnormally low circulating supply. A controversial strategy aimed at artificially inflating the overall market value.
But this tactic proves to be a dangerously precarious game for retail investors. In fact, when founders or historic investors decide to release their symbolic reserves, devastating selling pressure occurs. Prices then collapse, turning these small crypto investors into real scapegoats.
Projects like DYDx in the past, or more recently Altlayer, Pixels and ApeCoin, perfectly illustrate these drifts. With a circulating supply of less than 10% at launch, DYDx managed to keep its price above $20 for long months before the inevitable collapse. A typical scenario that repeats itself endlessly to the detriment of novice cryptocurrency investors.
2024, the year of all risks for altcoins
Unfortunately, this year 2024 promises to be a real nightmare for the alternative cryptocurrency ecosystem. In fact, according to estimates, the volume of unlocked tokens will reach the stratospheric level of 44 billion dollars. An unprecedented flood!
As of June, billions of Altlayer (ALT), Pixel (PIXEL) and ApeCoin (APE) tokens will be released, exposing these projects to immense risk of correction. But according to well-known analyst Alex Wacy this is just the beginning. He warns that a significant amount of tokens will enter the cryptocurrency market this year. Without sufficient capital inflows, selling pressure could increase considerably for many altcoins.
To survive this $44 billion deluge, investors they will need to exercise greater caution and agility in 2024. Taking an ultra-selective approach will be essential to avoid the worst investor traps in the onslaught of emerging altcoins. Monitoring liquidity levels and unlock programs for each cryptocurrency will be key to standing out in this high-risk environment.
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Eddy S.
The world has evolved and adaptation is the best weapon to survive in this wavering universe. The crypto community manager at the base interests me in everything that touches or comes close to the blockchain and its derivatives. With a view to sharing my experience and learning about a domain that I am passionate about, I write informative and detailed articles a la fois.
DISCLAIMER
The views, thoughts and opinions expressed in this article are solely those of the author and should not be relied upon as investment advice. Do your research before making any investment decisions.