The ruthless cycle of altcoins: why 2026 could still surprise

The last twelve months have taught a bitter lesson to those who blindly believe in alternatives to Bitcoin. Most altcoins have suffered catastrophic crashes, with losses in many cases exceeding 90% from all-time highs. Experts like Michael Van De Poppe argue that this bearish phase has been even more severe than the 2022 bear market. Yet, behind this bleak scenario emerges a crucial question: are altcoins truly finished, or are we observing signs of a structural recovery for the next cycle?

How time has selected the winners

The history of crypto markets reveals an unforgiving pattern: only projects with solid fundamentals and genuine innovation survive cycles. In 2017, any token could multiply simply due to the widespread bullish sentiment in the market. By 2021, everything changed. The dynamic rewarded only projects with compelling narratives and authentic technical development.

Numbers don’t lie. Solana experienced growth of about 250 times from its cyclical low to its peak. Avalanche offered returns around 55 times. Conversely, historic flagship projects disappointed. Litecoin gained only 17 times, significantly below Bitcoin and high-performing altcoins. NEO, once synonymous with hype in 2017, has been completely eclipsed by more modern networks.

The lesson is unequivocal: enthusiasm for its own sake no longer generates sustainable returns. Obsolete altcoins hold a huge load of investors in loss, which in turn hampers any bullish potential. Without technological innovation, actual adoption, and concrete use cases, these tokens will continue to slide toward irrelevance.

The two forces that determine winners: alpha and beta

In crypto analyst language, two concepts dominate research: alpha and beta. Beta represents the raw return derived from the overall market rise. Alpha, on the other hand, is the additional performance that a single project generates by outperforming the market benchmark.

Solana, for example, generated extraordinary alpha during the last cycle, significantly distancing itself from the average. Projects like Litecoin and NEO instead recorded negative alpha, underperforming the overall market. This difference explains why only a handful of altcoins manage to catalyze transformative returns. The beta generation of new tokens, represented by projects with real innovation, is what creates market opportunities.

Valuations at the minimum: the missing signal

Comparing current altcoin valuations with traditional assets like gold or even Bitcoin reveals a disturbing fact for analysts: altcoins are trading at the lowest prices recorded after major market crashes. This doesn’t automatically mean that a rally is imminent. However, from a risk perspective, the message is clear: the margin for further declines is significantly narrowing.

If liquidity conditions improve and stronger projects continue to develop, 2026 could witness the emergence of a new generation of altcoins capable of surprising again. It’s not a certainty, but it’s an eventuality that investors should monitor closely.

Natural selection in the crypto market

The truth is harsh: the vast majority of altcoins will not survive the next cycles. Blockchain remains an evolving technology, where progress is made through trial and error. The most recent networks tend to outperform their predecessors simply because they are more efficient, scalable, and aligned with the real needs of the ecosystem.

However, there is an alternative scenario. A small number of altcoins demonstrating genuine organic adoption, growth in concrete uses, and robust on-chain data could still deliver significant gains in the upcoming chapters of the crypto market. The key lies in identifying these projects before the rest of the market discovers them.