As we move deeper into 2024, the cryptocurrency market continues to reveal a complex and evolving landscape. While early expectations pointed to a robust performance from newly launched projects—especially those backed by major venture capital firms and listed on top centralized exchanges (CEXs)—the reality has been far more subdued. Despite Bitcoin reaching new all-time highs and institutional adoption accelerating, the broader altcoin market, particularly newly listed tokens, has struggled to gain momentum.
In fact, the majority of new tokens listed on the "Big 4" exchanges—Binance, Bybit, OKX, and Bitget—have posted negative returns since their initial listing. The underperformance is further underscored by data showing that altcoins (excluding ETH) have declined 17% against Bitcoin since the beginning of the year. This trend, visible in the TOTAL3/BTC chart—which compares BTC to the combined market cap of the top 125 cryptocurrencies (excluding BTC and ETH)—signals a growing divergence between Bitcoin’s strength and altcoin weakness.
What’s behind this shift? Several interrelated factors are reshaping investor behavior and market dynamics in 2024.
Institutional Influence and the ETF Effect
One of the most defining characteristics of this market cycle is the dominant role of institutional capital. Unlike previous bull runs driven by retail enthusiasm, the 2024 rally has been largely fueled by exchange-traded funds (ETFs) and institutional inflows.
The anticipation of a spot Bitcoin ETF approval—officially granted on January 10, 2024—ignited a wave of confidence. From late October 2023, Bitcoin surged from below $30,000 to over $40,000 in just one month. Since then, more than 70 spot Bitcoin ETFs worldwide have attracted over $28 billion in net inflows, with institutional holdings now exceeding $72 billion in Bitcoin value.
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A similar pattern emerged with Ethereum following the SEC’s announcement in May 2024 regarding potential ETH ETF approvals. This mini-bull run has primarily benefited large-cap, established assets like Bitcoin, Ethereum, Solana, TON, and BNB—all of which have seen strong performance relative to newer altcoins.
While institutional interest has bolstered market legitimacy and driven Bitcoin to a peak of $73,750 in March, it has also created a concentration effect. Capital is flowing into trusted, liquid assets, leaving many new projects struggling for attention and funding.
High FDV, Low Liquidity: A Structural Challenge
Newly launched projects face an uphill battle due to structural issues in tokenomics. Many 2024 listings feature high fully diluted valuations (FDV) paired with low circulating supply and limited liquidity—a combination that undermines long-term price stability.
Take StarkNet (STRK), for example. Launched in February 2024, it entered the market with an FDV of $6.9 billion despite a circulating market cap of only $895 million. With just 13% of its 1 billion token supply in circulation, the project faced immediate selling pressure as unlock schedules progressed. Even as its market cap nearly doubled to $2 billion, the token price plummeted by 50% to $1.30.
This pattern—high FDV, low float—is increasingly common among new launches backed by venture capital. While VCs secure tokens at favorable valuations, retail investors often enter at much higher prices, only to face dilution as future unlocks flood the market. This dynamic has bred skepticism among retail participants, who now view many new projects as overvalued and unfairly structured.
The VC-Retail Divide: Shifting Investor Priorities
The growing tension between venture capital and retail investors is another defining theme of 2024. While VCs continue to push high-FDV projects with complex narratives—such as AI integration, DePIN (decentralized physical infrastructure), and Real World Assets (RWA)—retail investors have pivoted toward alternative opportunities.
After early exposure to promising narratives this year, retail capital has increasingly flowed into the meme coin supercycle, where projects launch at low valuations and thrive on community-driven momentum. This shift reflects a growing preference for speculative, high-risk/high-reward plays over VC-led initiatives perceived as overpriced and inaccessible.
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Exchange Listing Strategies: A Tale of Two Approaches
The performance of newly listed tokens also reflects differing strategies among major exchanges.
- Bitget and Bybit have taken an aggressive approach, listing over 310 and 130 tokens year-to-date, respectively. Their focus has been heavily skewed toward meme coins and niche sectors, resulting in higher volatility. Approximately 80% of Bitget’s new listings and 70% of Bybit’s have delivered negative returns.
- Binance, by contrast, maintains a more selective listing process, emphasizing due diligence and project maturity. Despite this cautious stance, about 50% of its new listings are still underwater—a testament to the broad market downturn.
These contrasting models highlight a fundamental divide: some platforms prioritize volume and accessibility, while others emphasize quality and sustainability. Both strategies reflect different visions for the future of crypto trading.
Measuring Altcoin Momentum: The CMC Altcoin Season Index
To help investors navigate this uncertain environment, CoinMarketCap recently introduced the CMC Altcoin Season Index. This tool analyzes the top 100 cryptocurrencies (excluding stablecoins and wrapped tokens) based on their 90-day rolling performance relative to Bitcoin.
- If 75% or more of these coins outperform BTC, it signals Altcoin Season.
- If 25% or fewer outperform BTC, it indicates Bitcoin Season.
Currently, the index suggests we are still in a Bitcoin-dominated phase—a reflection of institutional flows and risk-off sentiment toward newer assets.
Is an Altcoin Revival on the Horizon?
Despite current challenges, historical patterns suggest potential for a turnaround in the second half of 2024. Four years ago, Bitcoin dominance stood at 65% in June 2020—by mid-2021, it had dropped below 38% as altcoins surged during the previous bull cycle.
Several catalysts could reignite altcoin momentum:
- The post-halving supply shock, reducing new Bitcoin issuance.
- Expected Fed rate cuts, potentially boosting risk appetite.
- The U.S. presidential election, with both major candidates expressing pro-crypto sentiments.
These factors may create favorable conditions for a shift in market leadership—from Bitcoin to high-potential altcoins.
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Frequently Asked Questions (FAQ)
Q: Why are newly listed tokens underperforming in 2024?
A: Several factors contribute: institutional capital is favoring Bitcoin and Ethereum via ETFs; many new projects have high FDVs and low liquidity; and retail investors are increasingly skeptical of VC-backed launches.
Q: What is the Altcoin Season Index?
A: It’s a metric developed by CoinMarketCap that tracks whether 75% of the top 100 altcoins (excluding stablecoins) are outperforming Bitcoin over a 90-day window. If yes, it signals Altcoin Season.
Q: Are high FDV projects always bad investments?
A: Not necessarily—but they carry higher risk. High FDV with low circulating supply can lead to significant price drops when tokens unlock. Investors should assess token unlock schedules and vesting terms carefully.
Q: Which exchanges are listing the most new tokens in 2024?
A: Bitget leads with over 310 new listings year-to-date, followed by Bybit with over 130. Binance maintains a more selective approach with fewer but higher-profile launches.
Q: Can meme coins outperform traditional altcoins in 2024?
A: Yes—in certain phases. Retail-driven momentum has fueled meme coin rallies, especially when traditional projects appear overvalued or illiquid. However, meme coins are highly speculative and volatile.
Q: What could trigger the next altcoin season?
A: A combination of macroeconomic factors—such as Fed rate cuts, increased retail participation, post-halving scarcity, and positive regulatory developments—could shift focus back to altcoins.
Core Keywords
- Altcoin Season Index
- New token listings 2024
- High FDV low liquidity
- Institutional crypto adoption
- Bitcoin vs altcoins
- VC-backed crypto projects
- Retail investor trends
- ETF impact on crypto
The current market environment is undeniably challenging for new projects. Yet within this complexity lies opportunity—for informed investors who can distinguish between hype and genuine innovation. As the cycle progresses, those who understand the interplay between institutional flows, tokenomics, and investor sentiment will be best positioned to navigate what comes next.