In November and December 2023, certain altcoins emerged in earnest from the crypto winter that began a year earlier, once again basking in the sunshine of popular buzz. Avalanche's AVAX token gained a whopping 97% in November alone, while Helium's HNT caught the eye with a recorded high return of 110%. Already in the first week of December, AVAX recorded a percentage return of another 17% in a single day, but Helium surpassed them again, reaping the rewards of extending its mobile plan beyond Miami to the rest of the United States.
What drove all of this on a broad level? The Federal Reserve's expected dovish path, along with its December decision to hold interest rates steady and signal three potential rate cuts in 2024, gave life to risk assets. US stocks, for example, performed well after the Federal Reserve meeting. However, in the opinion of OANDA's Craig Erlam, the most prominent force driving up token prices was the anticipation of SEC approval for spot bitcoin ETFs.
The interesting thing about many altcoins is the fact that, while they seem to offer little more than a renewal of the Well-Well-known dog token theme, they benefit from their familial relationship with the other assets on their local blockchains. Syncracy Capital's Ryan Watkins explains how this digital nepotism works: "The base asset of a blockchain increases and creates a wealth effect." [and] โThat wealth is channeled into a handful of assets in the ecosystem.โ In fact, several blockchains have recently acquired their own meme coins. However, one cannot help but wonder to what extent mere family ties will carry these new tokens in the months and years to come. Today we ask: Which altcoins have what it takes to continue thriving through 2024 and beyond?
solarium
The Solana blockchain's special talents in facilitating fast and cheap transactions were forgotten after FTX (whose founder was associated with Solana) collapsed in late 2022. The token closed that year with devastating losses of 94%. But 2023 changed all that: as of the third week of December, SOL had posted a high performance of 800% for the year.
One of the unique factors driving Solana's success was the name Firedancer. According to Van Eck Associates, this software update is powerful enough to increase Solana's capabilities tenfold. โWe think Solana is undervalued,โ suggests Van Eckโs Matthew Siegel, โbased on the probability we attribute to SOL being the first blockchain to host an application with 100 million users.โ
Solana has apparently addressed the technical issues that used to cause network outages. February 2023 was the last time such an incident occurred. They have also generated new excitement by creating an NFT marketplace called Tensor, which has eclipsed other similar marketplaces on Solana, most notably Magic Eden. On Tensor, users engage with NFTs not as collectibles (as these assets are traditionally treated), but as trading assets, whose price fluctuations can be exploited for monetary gain.
bonk
Bonk is the prodigal son of the Solana family. Between mid-November and mid-December 2023, Bonk recorded a 1000% increase in cryptocurrency trading, recording 50% in a single day. What are the strong fundamentals and special use cases behind Bonk to justify this type of price activity? Wellโฆ โIt is Solana's dog coin and Solana has been the favorite of 2023,โ explains Zaheer Ebtikar of Split Capital.
When exchanges Binance and Coinbase recently expressed their support for Bonk, the young token's network of high-profile partners expanded further. This helpedโ[create] โA compelling narrative about Bonkโs future trajectory,โ says Nansenโs Jake Kennis. A compelling narrative is one thing, but intrinsic value is quite another. According to Strahinja Savic of FRNT Financial Inc., "It's more like betting and some kind of gambling than investing."
Helium
Helium's HNT had a wonderful December but also a wonderful 2023, which brought it a high return of 500%. Its deft entry into the mobile space had a lot to do with it. Nova Labs (formerly known as Helium Inc.) raised eyebrows in early December by offering people across the United States to use its blockchain technology to make unlimited calls and texts for $20 a month. Satisfactory results began to emerge when thousands of new customers knocked on Helium's door.
The Helium network also hosts other tokens. One of them, for example, is a stablecoin and another is called MOBILE. Customers who provide a home to Helium access points, which allow the network to function, get MOBILE every time customers use the network. MOBILE price recorded 2,000% in the first 18 days of December, which in turn acted as a pull factor for new Helium Mobile subscribers.
The landscape ahead
The terrain ahead for Solana could be a little rockier than it has been so far. โIn the next bull cycle, Solana will face tougher competition than in the previous cycle,โ suggests Kunal Goel of Messari. Goel is referring to other super-fast blockchains recently introduced by industry participants. Still, one big thing that Solana has going for him heading into 2024 is institutional support. In October, for example, they received $67 million through ETF flows.
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