This Web3 investor is not optimistic about the cycle, worries about altcoins and their drawdown

Web3 crypto investor Jason Kam spoke to Asian journalist Colin Wu in a Spaces conversation on X, where both discussed the state of altcoins, what to expect this year and the next and the “optimism” or sentiment among market participants this cycle. 

Bitcoin price performance in the last 90 days leads when compared to top 50 altcoins ranked by market capitalization. Data from the Altcoin Season Index shows it is not “Alt season” yet meaning, Bitcoin continues to outperform altcoins in the longer timeframe. 

According to Kam, altcoins could perform better in 2025, when buying picks up in the secondary market or cryptocurrency exchange platforms. 

Demand on exchanges to play key role in altcoin gains

Kam elaborates on the relationship between altcoin price, demand on cryptocurrency exchanges, new projects, token issuance and investor sentiment in a Spaces conversation with Colin Wu. Kam says he hardly made any moves, meaning did not take many positions in altcoins in the past few months, given the state of the altcoin market. 

Altcoins continue to suffer significant drawdowns from their cycle tops, while Bitcoin holds steady above key psychological support at $65,000. Less than 40% of the top 50 altcoins have outperformed the largest cryptocurrency in the last 90 days, per data from the Altcoin Season Index. 

While altcoins struggle to break out of their multi-month downward trends, Kam says that a revival in demand across cryptocurrency exchanges could play a pivotal role in driving altcoin gains. 

The investor elaborated on how new projects issue tokens, list them on exchanges and shed their holdings for profit within a short timeframe, dragging down the entire value of the altcoin market. 

The investor comments on how Former US President Donald Trump could influence better governance and crypto regulation, replace the Chair of Securities & Exchange Commission (SEC) and promote adoption of the digital asset class in the US. 

At the time of writing, the crypto market erased nearly 1% value in the last 24 hours.