Most Altcoins Won't Recover. Here's What Could Separate the Winners.

This could be one of the best times to accumulate altcoins. The reason is that several indicators suggest the crypto bear market could be near the bottom, but there is a catch. Most analysts agree that in the next bull market, we shouldn't expect an alt season like we've seen in previous cycles. I mean, where almost every altcoin goes up at the same time. That means identifying the right sectors and the right projects could be more important than ever. So, in this video, we are going to look at some of the altcoins that could have the best chance of all performing in the next bull market. And we're not talking about meme coins that can go up a 100x and then crash to zero right afterwards. We're talking about quality altcoins that could potentially be held as investments for at least a couple of years. As we'll see, there are a few specific characteristics that could separate the winners from the thousands of altcoins that may never recover. Before we start, this video should not be considered financial advice. It is educational content only. Before investing in any alt coin, make sure you do your own research. Let's jump into it. As a guideline for building a strong altcoin portfolio, I think it's useful to start with a recent tweet by Ki Young Ju, the founder of CryptoQuant, one of the leading crypto analytics platforms. He said that, quote, 99.9% of altcoins should be rejected. But that doesn't mean all of them are dead. According to him, narratives alone are no longer enough to make an altcoin succeed. Some coins are still worth holding long-term, but only if they have, quote, real businesses, real revenue, and fit global financial trends. Now, one of the keywords here is revenue. And here is why. Since the launch of the Bitcoin ETFs in 2024, crypto has become increasingly integrated into traditional finance. And the way investors value crypto protocols is becoming increasingly similar to how they value real-world businesses, which means looking at their ability to generate revenue. Now, you could say crypto networks have been generating significant revenue for years via transaction fees. Ethereum and layer twos are obvious examples. And yet, the price performance of these tokens has been disappointing. That is because generating revenue alone is not enough. A network can gain adoption and generate economic value without that value automatically accruing to its token. Instead, it goes to development, grants, and ecosystem growth. So, when searching for the right altcoins, we want to look for protocols that generate real revenue and allow the token to capture some of that revenue. That can happen through mechanisms such as token buybacks and burns. We'll come back to those in a moment. But first, I want to highlight another important part of Ki Young Ju's statement, real businesses. In other words, the opportunity is not about finding the next successful blockchain, such as the new Ethereum or Solana. It is about finding successful applications. According to recent research, financial applications account for about 50% of total monthly crypto revenue in 2026, while base layer blockchains are down to about 25%. That could be a sign that the economic center of crypto is moving from the infrastructure layer to where the applications running on top of it. And we've seen something similar before. Think about the internet. In the beginning, enormous amounts of investment went into infrastructure, servers, networks, and telecommunications. But eventually, much of the economic value was created by the applications built on top of that infrastructure, marketplaces, social networks, and so on. Something similar is now happening in crypto. Okay, but now, which altcoins possess the characteristics we just pointed out? Let's look at some examples. Probably the best example is Hyperliquid. Hyperliquid is a decentralized exchange focused on perpetual futures and other on-chain trading. It surpassed $1 billion in cumulative revenue in 2026, making it one of the highest earning protocols in the crypto industry. But as we explained earlier, the important part isn't simply the amount of revenue, it's what happens to it. About 99% of Hyperliquid's protocol trading fees are directed to its assistance fund, which buys the Hype token on the open market. So, the mechanism is relatively straightforward. More trading, more fees, more protocol revenue, more Hype purchases. That creates a direct connection between usage of the platform and demand for the token. Another example is Uniswap, the largest decentralized exchange in crypto. Historically, most trading fees on Uniswap went to liquidity providers and did not benefit the holders of UNI, which was purely a governance token. Basically, Uniswap could process enormous amounts of volume and generate huge fees without UNI holders necessarily capturing the economic value. That started to change with a major overhaul of Uniswap's tokenomics in December last year called unification. Since then, a portion of protocol fees has been directed to a token burn mechanism. Burning means permanently removing tokens from circulation, making UNI deflationary. That created a much more direct connection between the usage of the protocol and the value of the token. Aave is a decentralized lending platform where users can borrow and lend crypto assets without a traditional financial intermediary. Last year, Aave introduced a buyback mechanism as part of an upgrade to its tokenomics called Aavenomics 3.0. Under the newer tokenomics framework, part of the protocol revenue is now used to buy Aave tokens on the open market, which means more borrowing and lending activity, more protocol revenue, more potential of buybacks. So, what do these three projects have in common? First, they offer actual financial applications, trading and lending, rather than simply selling generic blockchain space. Second, they have strong revenue-generating business models. And third, their tokens have mechanism designed to capture at least part of that economic value through buybacks and burns. Finally, these projects fit into one of the strongest long-term trends in crypto, the convergence between crypto and traditional finance. Think about it this way. Uniswap is like an on-chain stock exchange. Aave is like an on-chain bank or money market. Hyperliquid is like an on-chain futures exchange. Remember, these are just three examples of the types of projects that we believe could dominate the next bull market. What is important are the characteristics they share. Again, real-world applications with real revenue mechanisms and tokens with value capture. According to Bitwise CIO Matt Hougan, the market is not fully reflecting the value of these protocols. Now, you might say, "If this thesis is so strong, why have tokens like Uni and Aave performed so poorly even after their tokenomics improved?" The answer is that revenue generation and value capture do not automatically guarantee that a token's price will increase. At the end of the day, price is still determined by supply and demand, And broader macroeconomic conditions have an enormous influence on the demand side. In the past year, the macro hasn't favored crypto. The Federal Reserve has remained cautious. Risk-on assets have suffered, but macroeconomic conditions will eventually improve, and that is when we are likely to see the next crypto bull market. And then, tokens that have good value capture and are linked to real applications and businesses have a good chance to outperform. That's it for today's video. What do you think of this analysis? And what altcoins do you think will outperform the next bull market? Let us know in the comments below. I'm Giovanni. See you in the next video.