The atmosphere of the crypto bull market has returned, at least for now.
Here comes the question: which altcoins will deliver excess returns?
During the bull market of 2021, almost any altcoin was soaring. But since then, the situation has changed.
Currently, there are millions of new altcoins launched on the market, and to achieve excess returns, one must carefully select investment targets.
In this article, I want to share my list of crypto projects and the key points for project screening.
1. Narrative Heat and User Sentiment
Think about the best-performing tokens in the past 12 months.
The first ones that come to mind are HYPE, VIRTUAL, and memecoins.
Do they all have strong fundamentals? Platforms like HYPE do, but most of those on the list with the best performance certainly do not.
They all have one thing in common: they possess a very high share of user sentiment on social media, and there is always a group of loyal fans tirelessly promoting them on the X platform.
Moreover, the success of most top performers is also related to a strong narrative.
Virtual continued to surge during the rise of the AI concept.
Meme coins surged from Q4 2024 to early Q1 2025 due to the popularity of internet memes.
My advice is to look for currently popular narratives, do some research, and then choose tokens with highly active communities on Twitter.
2. Growth Indicators
In a bull market, market enthusiasm (unfortunately) is far more important than fundamentals, but the good news is: some projects can achieve high attention while also having a high product-market fit.
If a project can possess both of these points, it could be a great investment, especially when its key metrics have recently shown explosive growth.
Let me give you an example: the stablecoin protocol Ethena saw its TVL surge by 50% in the past 30 days. Meanwhile, many users and analysts on the Twitter platform have been focusing on and analyzing the project.
The result? Ethena's token ENA has increased by 154% in the past month.
By betting on projects that are in their early stages and have continuously growing data indicators (such as TVL, revenue, and transaction fees), along with a certain level of community enthusiasm, you can make a big profit.
I often use DeFiLlama to discover the fastest-growing projects.
3. Reasonable Token Economics
If you plan to buy a token and hold it for only a few days, the token economics are not very meaningful; but if it's a medium to long-term investment plan, the situation is completely different.
For example, the TIA token has plummeted over 90% in the past 17 months, primarily due to large-scale sell-offs by early investors after each token unlock.
That's why it's important to understand the token economics before buying tokens.
Here are several key points I focus on when researching a token:
Token Unlock Schedule
Tokenomist can check the token economics and unlocking status of many popular tokens.
Generally speaking, I hope the circulating supply reaches at least 30%, and the annual token release (i.e., inflation rate) does not exceed 20%-35%.
Additionally, if there is a large-scale token unlock in the near future (for example, the unlock amount is equivalent to more than 20% of the current circulating supply), I would prefer not to buy that token.
Token Utility
I always ask myself two questions:
Will the token I want to buy benefit from the success of the protocol? Why would someone be willing to buy it at a price higher than mine?
A dividend mechanism or token buyback plan is the best solution I can think of.
Admittedly, while strong token utility is a huge advantage, it is not a necessary condition. I have witnessed many tokens with almost no utility still perform excellently.
4. Community First
Currently, a community-first project is more important than ever.
More and more people are unwilling to invest in vague and uninteresting projects; they prefer to support teams that care about the community.
This is also one of the reasons I think tokens like HYPE and PENGU have performed so well recently.
Some characteristics of crypto projects that prioritize community:
Conducted a large-scale airdrop.
Their team always makes promises lightly but delivers heavily.
Team-led marketing: Their team is very active on the X platform and continuously interacts with the community.
A large portion of the token supply is allocated to the community.
These are some of the main factors I consider when selecting tokens.
Another important factor that may drive token prices up is the upcoming significant catalyst, which has not yet been factored into the current price.
Possible positive factors include: upcoming protocol upgrades, improvements in token economic models, or the release of new products that can significantly increase project revenue.
No matter how good an asset is, buying it at a high price is still a bad investment.
Wait patiently for the right opportunity, and avoid impulsively chasing prices.
#hype #VIRTUAL #山寨币热点 #加密市场回调 #稳定币热潮
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