Three Major Crypto Bubbles in the Second Half of the Year: Too Many Tokens, Dot Games Are Too Hot, Nvidia Is Too Hot
The popularity of these Mini-app users on Telegram is expected to cool down or reach saturation in the second half of 2024.Original Title: “3 'growth bubbles' hanging over Crypto investors in the second half of 2024”
Author: Viet Anh
Translation: Shenchao TechFlow
Key Points Summary
- The bubble-like growth of altcoins in 2024 and the risks it brings.
- A surge in the number of users participating in tap-to-earn games in 2024.
- The increasing popularity of Nvidia (NVDA) stock in 2024 and signs of a bubble.
Between 2023 and 2024, the overall market capitalization of the Crypto market has not shown a parabolic rapid growth, and it has not yet returned to the historical peak of 2021. These predictions of growth bubbles are not aimed at the crypto market itself, but at other data and objects that have a significant impact on the crypto market.
Below is a summary and assessment of these growth phenomena.
The Growth of Altcoins in 2024 and the Associated Risks
Although the market capitalization has not returned to its peak, the number of altcoins and new projects has already surpassed the peak and has increased many times compared to previous cycles. This has led the market into a situation of "too many projects for too few people," with too many projects competing for an increasingly smaller market capitalization pie.
According to Coingecko Research, as of April 2024, the number of tokens in the market has exceeded 2.5 million, compared to 1.98 million in 2023. This means that in less than half a year in 2024, over 500,000 tokens have been created. Coingecko states that an average of 5,300 new tokens are created every day.
Meanwhile, market trading volume is gradually decreasing, and the market capitalization has not returned to the highs of 2021. Recently, Binance has taken unprecedented measures by launching an early warning feature to alert users about which tokens may be delisted. This is due to the excessive number of coins in the market, but with poor liquidity.
It is expected that in the near future, the number of tokens with low liquidity and trading volume will increase. Many tokens/altcoins will be delisted, and investors will need to reassess their portfolios and reallocate funds to truly high-quality tokens.
A Surge in Users Participating in Tap-to-Earn Games in 2024
Since the beginning of 2024, various tap-to-earn game applications on Telegram have sparked a frenzy within the community.
Hamster Kombat announced that as of June, their user count has reached 200 million, making it the most popular tap-to-earn application currently.
Tapswap announced that they have 55 million global players and 18 million daily active users.
Yescoin also announced that in just over a month, their user count has reached 18 million, with over 6 million users connecting their wallets.
All these projects are highly anticipated to become the next "Notcoin." But the question is, how to provide sufficient liquidity for hundreds of millions of users? Will user growth continue? Meanwhile, many experts believe that the crypto market in 2024 lacks inflows from retail investors, who were a strong growth driver in previous cycles.
It is expected that as the market capitalization of altcoins recently drops below $100 billion, the enthusiasm for these Mini-app users on Telegram will cool down or reach saturation in the second half of 2024.
Nvidia (NVDA) Stock Grows Rapidly in 2024 and Shows Signs of a Bubble
Nvidia (NVDA) stock is a major representative of the so-called "AI stocks" wave in 2024. Taking Apple's stock as a recent example, as the company entered the AI market through a partnership with OpenAI, AAPL's market capitalization increased by $600 billion. NVDA's market capitalization has nearly increased by 900% in the past two years, surpassing Google and Amazon to become the fourth largest asset in the world by market capitalization (after gold, Microsoft, and Apple).
The Financial Times in the UK believes that this phenomenon is a sign of bubble growth, where a bubble forms when investors overestimate the potential of something and place high hopes on it. It is currently unclear what impact the bursting of the AI bubble would have, but the positive correlation between U.S. stocks and Bitcoin suggests that it could severely impact the entire crypto market.
