The idea of everyone waiting around for a "bull market" is crazy when you think about how much of a rally bitcoin and the crypto sector overall has had. In fact the current market cap of all of crypto is roughly 3.5 trillion dollars and nearly touched 4 trillion dollars in market cap so far. This is nearly double what it was during the last bull run and I could see us peaking out at about 4.5 trillion for a peak.

The big issue that many people are not realizing is just how many tokens there are now. In 2013 there were roughly 500 tokens in existence. 2017 during the Ethereum bull run and layer two tokens just starting we saw 3,000 tokens in existence. IN 2021 when things starting to get bonkers we sway that number jump to a whopping 3 million tokens and today we have over 36 million tokens.

There's only so much capital in the world and right now it's being diluted into many tokens. So the thought of massive rallies on tokens might be almost gone now as just too many projects and expansion has happened compared to the market cap. Same pool of money over millions of more tokens ends up being a lot less market cap for particular tokens.

Now you can still do your own research and find the winners or projects you feel will do well. We see this all the time in the stock market where proper research, getting in early and just before it goes major bull based on fundamentals there are big winners but the chances of hitting them gets smaller and smaller.

You see in 2013 you could nearly put your money anywhere and it would grow because there were limited options.

Now these pumps from layer two and layer three tokens can actully benefit the core platform above it. While it's not as large of a gain for example trump coin what it did do was pump a lot more market cap and liquidity into Solana. This is why these layer two options will be so powerful to the core blockchain and why I'm excited for Hive to have another variation of that. I'm just hoping people will build on it is the real issue next.

The Hype

The other part of all of this which we can see with on chain activity is that a lot of people who are creating wallets on these blockchain new crypto people or non new crypto people mainly just created the wallet to trade that single token when it was crazy hyped up and then quickly fell off when that token crashed.

These people didn't interact with any other token. They simply put money in, lost a lot and stopped using it within the matter of 5 days lol.

What's happening once again are insiders, scammers etc are launching hyped up tokens cashing out and leaving everyone else to rot. If we could just get one solid token that had some good fundamentals and then had a hyped up launch that didn't crash so hard soon after we would be in such a better stop. But this will always happen 90% of the population is stupid with investing and FOMO and wonder why they lose out.

The Filter

As AI advances and grows we will most likely see it play a bigger part in crypto and a big part of that could be for AI to seek our legitimate token launches with solid teams and fundamentals. Most right now are Ponzi, cash grabs or extremely low effort tokens. It honestly reminds me of NFT season but with low class pump and dump meme coins this season and that might be what we chop it up to be honestly.

What will happen is a evolution at some point where legitimate projects shine through and those will later outpace the pump and dumps. Thus the real alt season begins and it will not be all alt coins it will instead be a select few that have passed certain checks most likely from AI, a company or peoples own research. That does have the potential of Hive actully being a decently solid options if VSC launches and some projects are built on it to showcase what is possible with the platform that's going to be critical.

Something to watch for this would be the bitcoin market cap and dominance in the platform.

We are right now seeing bitcoin holding a rather large sum of the market cap at currently a little over 57% of the market.

Now pervious cycles have show bitcoin fall to a 44% dominance and while I don't think we will get that low we still have around a 7% - 14% gap range right now for bitcoin to lose dominance and altcoins to take over. That percent might not feel like a lot compared to last cycles but you have to also account that there is nearly 1 trillion dollars more in the market cap at the moment compared to the last cycle. Thus the change dollar value is on par or higher for this cycle when it hits.

Posted Using INLEO