WOO X Research: Bitcoin returns to 90,000, which altcoins are worth looking forward to?

Author: WOO X Research

Bitcoin has regained the 90,000 mark on April 23, partly due to the clarity in the tariff war situation. U.S. Treasury Secretary Yellen stated that the tariff deadlock is unsustainable and expects the situation to ease in the near future.

On the other hand, recently Trump has been publicly pressuring Federal Reserve Chairman Powell, strongly demanding interest rate cuts, even making remarks about firing him if there are no cuts ( Powell ). This has led to global market skepticism regarding the independence of the Federal Reserve, resulting in distrust of the US dollar. The latest situation is that when the media asked Trump about this matter, Trump stated: "I have no intention of firing him ( Powell ). I just hope he can be more proactive about interest rate cuts."

Bitcoin, during the previous time when Trump demanded Powell's resignation, rarely played the role of "digital gold" as a safe haven, showing a strong correlation with physical gold. Now that Powell's career crisis has been resolved and U.S. stocks have rebounded significantly, Bitcoin continues to rise. At this time, Bitcoin is also enjoying the benefits of liquidity asset premiums, having increased by 12% over the past seven days.

In the previous article, we mentioned that during the recent rise of Bitcoin, altcoins did not keep up, with Bitcoin's current market share reaching 64.2%, hitting a new high in four years. Although it is still uncertain when the altcoin season will arrive, we can observe which altcoins outperform Bitcoin during turbulent market cycles to identify capital preferences, which may likely continue strong trends in the future.

The top 100 cryptocurrencies by market capitalization have performed better than BTC in the past seven days.

The table below lists the top 100 tokens by market capitalization, whose performance in the past seven days has outperformed BTC. In fact, there are not only the 11 tokens listed below; as Bitcoin surged on April 23, its market share slightly dropped (0.2%), indicating a general rise in altcoins. Therefore, many tokens that had been declining for a long time surged overnight, surpassing Bitcoin's seven-day performance. However, this rise should be interpreted as liquidity overflow rather than a result of capital selection.

Therefore, when choosing tokens, exclude those that experience overnight surges and instead select altcoins that have steadily outperformed BTC over the past seven days.

Which tracks should be focused on?

The key areas of focus based on the above tokens will be: AI, L1, Meme, and DeFi.

AI: The previous narrative was initiated by AI, starting with the combination of GOAT and memes, and later exploring more possibilities and applications. This brought about a bubble under the AI frenzy, which eventually burst under the continuous issuance of tokens by the Trump family. Ultimately, most AI tokens fell by over 90%, reshaping valuations.

The bursting of the bubble does not mean the end of the track, but the mechanism of eliminating the good and bad projects in the market, which means that with the continuous development of Web 2 AI, the Web 3 AI project has undergone a round of reshuffle, if you believe that Web 2 AI can be transmitted to Web3, then the valuation of the AI track is relatively cheap, and the fundamentals of the remaining projects have been tested.

The currencies represented outside of the table: VIRTUAL, ARC, ALCH, SWARMS, Zerebro

L1: Public chain coins have always been a relatively stable choice during the arrival of the altcoin season. The overall logic is that the development of public chains determines the ceiling of the ecological projects under them, while also being able to capture the most liquidity.

However, unlike in 2021, funding is no longer paying for "EVM copy-paste" but is looking for public chains that can truly bring new applications through TPS and developer tools. Once specific catalysts (such as exchange listings and institutional investments) appear, the price elasticity is significantly higher than that of established L1s.

Emerging public chains without issued tokens: Monad, MegaETH

Meme: Bitcoin is the largest meme coin in the whole currency circle, meme coins have become prominent in this cycle, and there is a high probability that they can continue to survive in the future, the key factor is that meme coins are the carriers of consensus and culture, and the head meme coins of each public chain can also be regarded as a leveraged version of public chain coins. Most meme coins are native on the chain, and the pricing power is not monopolized by centralized exchanges, so it is easy to have a wealth effect. As long as there is a wealth effect in the currency circle, there will be a steady stream of liquidity and participants.

DeFi: In the cryptocurrency space, DeFi is a rare track with a genuine business model. Perp Dex and Dex earn trading fees; lending can earn the interest spread on deposits; Yield Farming earns withdrawal fees; LaunchPad earns token issuance fees. In the table, HYPE, JUP, and AAVE are all dominant players in the DeFi sector. More importantly, they all have token buyback mechanisms, which means that as the altcoin season approaches and liquidity recovers, trading volume increases. Due to the network effects of leading DeFi protocols, overall projects will have higher profitability, and higher profitability means stronger buyback power. As the demand for tokens increases, the probability of the price continuing to rise also increases.

Conclusion: Keep a close eye on Bitcoin's market share

The launch of the altcoin season means that funds are flowing from Bitcoin to riskier and smaller market cap altcoins. Therefore, there are two key indicators to observe: first, whether Bitcoin can hold above 90,000, providing a stable confidence anchor for the market; second, and more importantly, whether Bitcoin's market share (BTC.D) can start to decline, reflecting a shift in capital preferences.

On April 23, Bitcoin surged to 90,000, but BTC.D only fell slightly by 0.2%, indicating that we are still in a phase of "funds concentrated in BTC, with stable growth in the base currency." However, if BTC.D starts to decline significantly, for instance returning to the 57% level seen at the beginning of the year, it will signal that funds are officially flowing into the altcoin market, at which point a "rotation market" will have the opportunity to fully unfold.

In other words, the true starting point of the altcoin season is not only the continuous all-time highs of Bitcoin but also the process of rising risk appetite and capital flowing from BTC to other thematic tracks. When these two happen simultaneously, we have the opportunity to see a comprehensive revitalization of the overall market. Now is the time to observe, filter, and plan; whether the altcoin craze is coming will be answered by the trend of BTC.D.