Altcoins
Expect Opportunities in Small- and Mid-Cap Altcoins Once Correction Resolves: Analyst Jamie Coutts
Crypto analyst Jamie Coutts says the current correction in digital assets is likely a mid-cycle dip that could be taken advantage of.
Coutts states on social media platform X that Bitcoin (Bitcoin) and Ethereum (ET) have held up much stronger than other crypto assets, implying that a potential mean reversion is on the table for smaller projects.
“Small-cap cryptocurrencies were hit from the March high this year. Over the past three months the peer-weighted Top 200 index has fallen 33% versus the market cap index, which has fallen about 12%.
This is the breakdown of three-month sector returns from my crypto classification framework:
Smart Contract Platform -31.58%
Infrastructure -43.28%
Digital world -44.13%
Digital Currency -31.59%
DeFi -31.15%
Applications -38.33%
BTC and ETH held up -11% and 5% respectively.
If we are experiencing a regular mid-cycle correction, which I think is likely, then expect there to be some opportunities in mid- and small-caps once the market stabilizes.”
Source: Jamie Coutts/X
When the rebound happens, Coutts He says decentralized artificial intelligence (AI) is another sector that presents “genuine opportunities,” but the analyst does not mention any specific coin or project.
Coutts also shares a chart comparing a declining price index of Tier 1 smart contract platforms with an increasing number of daily active users (DAUs). The analyst suggests that divergence is one of the best signs of health in the crypto ecosystem.
“Web3 users appear less price sensitive than in the previous cycle.
The number of daily active addresses (DAUs) on SCP (smart contract platform) blockchains has increased by 30% since March, while the SCP sector index has fallen by around 30%.
Demonstrating how wild the last cycle was, prices are 37% below the all-time high, but DAUs are 2.6 times higher (from 4.2 million to 11.2 million).
One is not the same as the other, but if you’re looking for a signal on the health of the crypto ecosystem, this is one of the best.”
Source: Jamie Coutts/X
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