Since I can't see a catch-all Bitcoin thread and this thread has a nice title , I will make this it. Posting some observations and notes on my strategy from this bull and the next.
The below chart shows the top 40 coins from 24/25 Nov 2017, 2021 and a very speculative prediction for 2024.
It has the market cap rank and category of the project. 2017 also has the 2021 rank. Only two increased in market cap rank from 2017 to 2021.
My thinking since 2017 was that this 2020- crypto bull market would see better gains for Ethereum as opposed to BTC, as people need to hold ETH to carry out transactions on the blockchain, and there are many good projects on the chain. This is some form of real demand. While at the time BTC was largely speculative. This is changing as BTC is increasingly seen as a store of value in a world of money printing, particularly used in the third world or corrupt regions; and it's now increasingly used with the Lightning Network, as in El Salvador.
You will also see that 2017 was the battle of the currencies, smart contracts were second order. 2021 has been the battle of the smart contracts, while a the second order has been gaming, DeFi and a few other projects, many of them relating the crypto infrastructure.
My prediction is that there will only be one currency in the top 40 in four years; and that a lot of the smart contracts will give way. Bitcoin will retain its top spot and much of the rest of the top 10 will be competing smart contact platforms. It is unlikely anything will challenge these, as smart contract platforms are the highest rung of the food chain. Everything else is built on top of them.
Then much of the top 11-20 and more trailing down will be 'infrastructure'. These are projects that provide services to decentralised applications, e.g. DeFi, games, marketplaces, governance etc. These are the second order of the food chain. These are projects like decentralised storage, APIs/data feeds, IoT services, networking and computing.
There are also bridges, which will link chains, e.g. Polkadot. These are a bit of a cross between the level of a smart contract platform and infrastructure. If one is successful, I except it to gain a high cap. But as the space matures I expect to see the smart contracts thinned out to one primary platform (maybe Solana) and a secondary platform, which will cater to dinosaurs and/or niche interests. This is the way of online. One platform tends to dominate. I think BTC has sealed its domination of currencies. The dominant smart contract platform should seal its position between 2024-2028. The key to winning the smart contracts race is to get as many projects onto your chain as possible. So the likes of Solana should divert some of their development grants to new projects to throwing bungs to solid older projects to go multi-chain on their chain.
The third order will be end-user applications/sites, like DeFi exchanges, DeFi lending, gaming platforms, marketplaces, media platforms, advertising networks etc. This is by-and-large the end of the food chain. There can be child projects of these projects, but they will be weak. If you buy them, the best you can generally hope for is to get out on a pump and dump. As an example, see the performance of yield-farming projects. The more popular ones have all boomed and cratered.
In the above chart I have produced a highly speculative listing for 2024. This has been produced not so much for the names, but the categories - to outline my prediction for the next bull market in crypto infrastructure projects. There will no doubt be new projects in the top 40 at that point. Only 8% of 2017's projects remain in the top 40 today. I think that will increase into 2024 and would expect at least 1/3 of them to be projects from 2021 or earlier. However, crypto is a very FOMO and fresh news driven market, mainly traded by people who know nothing about finance or economics. But the space is maturing, and is becoming more predictable, as you can see by some of the patterns noted above.
I expect 2024 to see very strong rallies in various infrastructure projects. One or two might breach the top ten, like Chainlink and Uniswap (not really infrastructure), but they will fall away, as Chainlink and Uniswap have. These are second and third tier projects in the food chain. If I buy such projects I will be looking to sell if they reach such positions, above their place in the food chain; as I have done with both LINK and UNI in the last several months.
For the incoming crypto crash, which I suspect will hit in Q1-Q2 2022 - probably when Mt. Gox releases 150,000 BTC into the open - I will be selling everything, again; and sitting out. I will place a few shorts and maybe a long on the first bounce; and may take a shot at one of the few projects that steal the space, e.g. DGX and VEN in 2018. But I will be out lending USD and maybe PAXG on ten or so different platforms. December 17 - January 18 saw huge demand to borrow dollars. I earned 9% over three days in January. Very high demand for dollars after a parabolic boom and crash is one signals I will be looking for. Buy back in about one year after the crash, or technically speaking when it goes <= 30 on RSI with 1 week candles (BTC).I will then look at opportunities to lend, stake and pool these. Initially I will probably keep it with the strongest coins like SOL and BTC. And I will give it some time to see how other projects develop and then buy them. I am looking for projects that fit into what was mentioned above, good execution, good communication and most importantly a good team & advisers. It is not that difficult to spot. I bought three projects from 2017 - ENJ, BAT + MANA in 2020 on this criteria. I believe that, with the exception of Decred, that is all of the 2017 non-currency + non-smart contract projects that remained in the top 100.
There are still a lot of 2017 era projects that are low cap and worth considering for a buy next season. Anything that has managed to stay in the top 200 has done well to stand firm against the barrage of new FOMO-exchange-listing-fresh-news projects. And there are a lot of good ones outside of the top 200.
Ones that immediatley come to mind:
BAT
MANA (if it crashes)
ENJ
GNT
Livepeer
DENT
More speculative and long term:
AVA (more long term)
Proppy (more long term)
Aragon
Lbry/Odysee (SEC issue)
Presearch
MYST
Civic (if you want to invest in
KYC)
Request Network
Depending on their pullbacks and prospects I am also interested in the coins of centralised exchanges: FTT, CRO, CEL + NEXO. There will be a PayPal of Crypto and it looks pretty certain it will be
Crypto.com.
Another way of telling what coins are good is selling which coins Greyscale picks, which includes MANA and BAT. Also look at which websites are still popular in the bear (Alexa rank, Similar Web).
Whatever you choose, buy in early, hold through any pain, and don't sell until it goes completely parabolic. Maybe it doesn't perform very well. But you will likely do best buying a few you think are strong at the beginning and letting the chips fall where they may. Rather than constantly gambling on FOMO.
Last point. Avoid buying things that are not particularly crypto- or tech-centric. There have been projects that were quite far from this like old people's home management, mining, document management, hospital management. These are far too far down the line. What has done well has been projects relating to crypto, finance and gaming. Next will be more normie facing tech, like the Youtube replacement.