Crypto Investment Panorama: Winning Strategies from Hot Tracks to Sector Rotation

Why Does Crypto Investment Require “Understanding the Sectors”?

Many people entering the crypto space tend to focus only on Bitcoin and Ethereum, overlooking a key fact: Cryptocurrencies, like stocks, have diversified industry classifications. Tech Stocks, Financial Stocks, Traditional Industry Stocks each have their bull and bear cycles. Crypto similarly follows this logic—different tracks and sectors will take turns performing well at different times.

If you only bet on a single coin, it’s like only buying tech stocks and missing the rise of energy stocks. As the crypto market matures, the patterns of rise and fall across sectors are no longer synchronized. Deeply understanding the characteristics, cycles, and risks of different sectors is the core strategy for long-term steady profits.

How Many Types of Cryptocurrencies Are There? A Look at the 9 Most Popular Sectors in 2024

The variety of cryptocurrencies has exceeded hundreds, categorized by application scenarios and development directions: Meme coins, RWA (Real-World Asset Tokenization), AI cryptocurrencies, DePIN, GameFi, Telegram ecosystem, Solana ecosystem, DeFi, and other emerging tracks. Each sector represents different technological innovations and investment opportunities.

The Most Explosive: How Do Meme Coins Create a 2405% Myth?

In 2024 alone, Meme coins have achieved an average return of 2405%, far surpassing all other sectors, making them the most profitable investment area in the crypto world. Their profitability is 8.6 times higher than RWA and 542.5 times higher than DeFi. This is not accidental but a true reflection of market sentiment.

The logic behind Meme coins seems simple but is deeply complex. It originates from the “meme” concept proposed by biologist Richard Dawkins in the 1970s— a cultural symbol that resonates widely and triggers large-scale dissemination. In crypto, this translates to: an image, a meme, or an event can ignite market speculation.

DOGE was born out of mocking the crypto bubble but became popular after a comment from Elon Musk. New Meme coins like PEPE, Dogwifhat, FLOKI, BRETT are flourishing. Recently, the hype around “Black God: Wukong” even led to the creation of $WuKong on the Solana blockchain, with a 24-hour increase of over 99,999%. Savvy investors made $350,000 profit in just 5 hours.

But high returns come with high risks. Meme coins are far more volatile than functional currencies, unsuitable for large sums or long-term holding. Their investment cycles are short, and they are easily driven by emotions. Currently, DOGE, with a total market cap of $44 billion, is the most liquid representative. Small investors can start here but must stay alert to risks.

Long-term Value: How Does RWA Turn Real Assets into Digital Wealth?

If Meme coins are the “gambling paradise” of crypto, then RWA (Real-World Asset Tokenization) is the “new frontier of value investing.”

Imagine: many lands in Taiwan have been fragmented over generations, making full transactions impossible. Traditional finance has no solution, but blockchain changes everything. By dividing assets into thousands of tradable tokens, previously “illiquid” assets gain new life.

In June 2023, a Rolex watch was successfully used as collateral for a loan of NT$400,000 via RWA. Antiques, art, fine wine, real estate—any valuable item can be tokenized. The process includes: setting token issuance limits, choosing issuance platforms, establishing smart contracts, producing tokens, and trust management of assets.

This “asset-only, person-not” trust mechanism has unlimited market potential. By 2030, the total global RWA value is projected to reach $16 trillion, accounting for 10% of global GDP. Even the largest asset manager, BlackRock, has launched a tokenized fund BUIDL and entered the space. RWA growth may not explode but follows an irreversible upward trend. For long-term stable investors, related tokens like Maker (MKR) are worth close attention. Total project token market cap: $7 billion.

Technological Dividend: Why Are AI Cryptocurrencies the New Darling of Capital?

The disruptive power and creativity of AI are reshaping the financial ecosystem. AI cryptocurrencies are products of deep integration between blockchain technology and artificial intelligence, using AI to improve transaction efficiency, enhance security, and enable smart contracts.

Representative project SingularityNET (AGIX) demonstrates this fusion’s power. It builds a decentralized AI economy where users can create, trade, and license various AI services, covering medical diagnosis, financial fraud detection, artistic creativity, and more.

Just as new technologies attract capital inflows, AI sector ranked 3rd in returns in the first half of 2024, only behind Meme and RWA. Key projects include NEAR, FET, AGI, etc. Investors confident in technological innovation and willing to take risks can explore this field appropriately. Total market cap of projects: $25.9 billion.

Infrastructure: How Does DePIN Reshape Digital Trust in the Physical World?

DePIN (Decentralized Physical Infrastructure Networks) connects blockchain with the physical world, managing infrastructure in a decentralized manner to achieve safer, more transparent, and more efficient operations.

Japan’s first legally registered IoT platform JasmyCoin (JASMY) is a typical example. Combining blockchain and IoT tech, users have full control over their data and can share it with third parties in a transparent, verifiable environment. As digital privacy protection becomes more important and IoT and big data applications expand, DePIN projects show impressive growth. Total project token market cap: $20.3 billion.

Play-to-Earn: How Does GameFi Break the Boundaries Between Gaming and Finance?

Traditional game currencies are controlled solely by developers, often devalued without players knowing. Blockchain changes this, giving rise to GameFi—a new mode combining DeFi and NFTs.

In-game items turned into NFTs not only gain rarity and ownership but can also be collateralized on DeFi platforms for crypto. Developers are further breaking down game barriers, building a “metaverse ecosystem”—NFTs earned in one game can be exchanged in others. Players earn rewards in their favorite domains, increasing liquidity through cross-game trading, pushing asset prices higher.

Once profits are substantial, more investors and speculators flood in, forming a complete industry chain. However, GameFi has yet to establish a mainstream leader; in the first half of 2024, most projects like GALA showed negative returns. Large-scale investment is not recommended. Total project token market cap: $14 billion.

Communication Revolution: Why Has the Telegram Ecosystem Become the New Hub of Web3.0?

As one of the largest instant messaging platforms globally, Telegram’s “self-destruct” feature is especially valuable in the AI era. It’s not just a communication tool but also a payment platform—built-in @wallet allows users to transfer funds.

Current supported payment methods include USDT, Bitcoin, and TON. TON is Telegram’s underlying blockchain currency, similar to LINE POINTS but with more functions. Besides transfers, TON supports Ethereum-like smart contracts, making transactions more transparent and secure. With a large global user base, though fewer in Taiwan, Total project token market cap: $70 million.

Speed First: How Does the Solana Ecosystem Challenge Ethereum’s Dominance?

Since its birth in 2020, Solana has changed the game in just four years, claiming to be an “Ethereum killer.” Its innovative proof-of-history (PoH) mechanism replaced Ethereum’s proof-of-stake (PoS), greatly reducing transaction times and costs.

Even during the FTX crisis, Solana continued to grow its user base, proving it has become an essential infrastructure beyond just an investment tool. More importantly, Visa, the world’s largest credit card company, has launched payment functions on Solana, settling with USDC stablecoins.

If Solana’s usage expands enough, companies might pay salaries directly in Solana, and consumers could pay daily expenses without currency conversion. This mirrors the logic of the US dollar as a global reserve currency—more acceptance increases its value. Future applications are virtually limitless. Total project token market cap: $6.8 billion.

The Future of Finance: How Does DeFi Redefine Money’s Value?

Cryptocurrencies were born to bypass the heavily government-controlled banking system. Traditional finance’s pain points include limited currency exchange, high fees, slow cross-border transfers, and government seizure. With technological progress, these restrictions become bottlenecks for development.

DeFi (Decentralized Finance) revolutionizes this by transferring funds directly via blockchain without bank intermediaries. While typical transactions are similar in timing, cross-border advantages are clear—traditional routes involve multiple banks, each taking fees and potentially freezing funds. Blockchain is fully transparent and cannot be arbitrarily seized.

Bitcoin’s first-mover advantage exists, but newer currencies have more advanced tech. Ethereum’s smart contracts and Solana’s speed are application-layer evolutions. Crypto investments require keeping pace with the most popular sectors.

Long-term, cryptocurrencies will diversify like fiat currencies—people might exchange Yen to visit Japan, and in the future, perhaps Ether to attend Taylor Swift’s concert. The attributes and functions of various currencies are crucial. Despite broad prospects, DeFi faces resistance—competing with traditional finance for market share. In the first half of 2024, stock markets performed strongly with less capital inflow, and overall returns were modest. Total project token market cap: $74 billion.

Sector Rotation: Why Does History Repeat but Never Exactly the Same?

The crypto market exhibits clear “sector rotation.” Economic cycles, policy changes, market hotspots, and other factors drive different sectors to take turns leading.

In late 2020, Bitcoin became the focus, with institutional funds pouring in. Early 2021, DeFi surged, with projects like Uniswap and Aave exploding, thriving on the Ethereum ecosystem. Mid to late 2021, NFT markets exploded, with Bored Ape Yacht Club and Axie Infinity gaining fame. From late 2022 to early 2023, Layer 2 solutions like Arbitrum and Optimism performed strongly, while Layer 1s lagged. Recently, due to spot ETF launches and rate cut expectations, Bitcoin has driven Layer 1 chains to rebound strongly.

The common factors behind these rotations are: technological advances, market trends, and policy environment changes. Understanding these patterns helps investors diversify risk scientifically and avoid the tragedy of “buying high and selling low.”

How to Check Crypto Sector Data?

Investment decisions need data support. The following tools help investors track sector trends:

CoinMarketCap: Provides global crypto market data (price, market cap, volume, etc.) categorized into DeFi, NFT, AI cryptocurrencies, and more.

Coingecko: Similar features, with detailed sector-specific statistics.

Messari: Offers in-depth blockchain research reports, market analysis, and financial data, supporting industry-based project performance filtering.

Regularly monitoring these platforms and understanding sector cycles and rotations is essential for long-term market success.

Conclusion: A New Mindset for Crypto Investment

How many types of cryptocurrencies are there? The answer has evolved from “Bitcoin, Ethereum, and others” to “at least 9 main sectors and hundreds of sub-projects.” Each sector represents different investment logic and risk tolerance.

Meme coins suit aggressive short-term speculators; RWA fits long-term value investors; AI and DePIN satisfy the pursuit of technological innovation. The key is to find sectors aligned with your risk appetite and adjust your portfolio flexibly amid sector rotations.

The future of crypto investment is not about choosing a single track but understanding market cycles and investing in the right sectors at the right time.