Author: Max Kalmykov, CEO of Bitsgap
Although Bitcoin and Ethereum have seen recent sideways trading around $60,000 and $3,000, optimism persists across crypto markets, with many anticipating a bull run. While prices plateau, it proves an opportune time to explore nascent narratives taking shape as adoption progresses. This is precisely my goal with this article—to examine which crypto trends are likely to generate both excitement and utility throughout 2024 and beyond.
Restaking
Restaking platforms currently dominate venture funding flows, becoming crypto’s shiniest new paradigm seemingly overnight. The concept of securing external apps via dedicated proof-of-stake networks generates immense enthusiasm. Whole sub-sectors now chase the trend, with “actively validated services” and “liquid staking” platforms all capitalizing on this excitement with their unique adaptations of the technology.
Advocates contend restaking bolsters security for embryonic blockchain networks. Bootstrapping robust decentralized consensus from scratch proves challenging without sufficient capital and an engaged community. Most protocols aspire toward permissionless proof-of-stake safeguarding over time. But the chicken-and-egg dilemmas around staking pose early hurdles. How can newer ecosystems incentivize adequate protection without either wealth or loyal users to delegate governance rights?
Platforms like EigenLayer offer a seemingly brilliant solution—submitting one’s ETH (or certain ETH-based derivatives) to the protocol, setting up an operator, and then choosing which Actively Validated Services (AVSs) to secure to earn interest. There’s an even easier path through liquid restaking services like Puffer, Ether.Fi, and Renzo. These services act as intermediaries, collecting assets from users, investing them in EigenLayer and similar platforms, and issuing “liquid restaking tokens” (LRTs). These tokens accumulate interest and can be traded within DeFi platforms to potentially earn higher returns. Such frictionless yield attracts capital inflows, with investors enamored by stacking speculative gains. But critics increasingly warn of shaky incentives—a rehypothecation of trust that could eventually fail.
Detractors highlight the danger of contagion risk—the notion that if an operator is penalized by an AVS, the repercussions could spread throughout the entire staking ecosystem, diminishing the value of the whole restaking pool and consequently reducing the security of all other AVSs. Thus, while restaking offers interesting opportunities, it is not devoid of risks.
Artificial Intelligence
It looks like the disruptive power of AI has solidified its impact, particularly with the recent release of GPT-4o just a few days ago, heralded as a groundbreaking development. Stated capabilities span teaching mathematics, flirting, and beyond, signaling expansive versatility. Specifically, GPT-4o promises 2x the speed, 50% lower costs, and 5x the rate limits versus its Turbo predecessor. At its core, technology moves conversations from human-to-computer towards human-to-human engagements. And while GPT-4’s expanded capabilities are undoubtedly exciting, as a trader, I thoughtfully consider potential impacts on crypto markets. The ripple effects could be significant, and it’s unclear exactly what will be disrupted.
Rather than speculation, it may be prudent to monitor related crypto projects enabling AI development, solutions, and services. These assets stand to benefit from surging interest in AI advancement. For example, Fetch.ai is a platform for developers to build and market autonomous AI software and services. As one of many high-potential projects focused on real-world AI applications, Fetch.ai and similar innovation-driven cryptos warrant attention. CoinMarketCap’s top AI and big data tokens provide a convenient starting point for researching viable crypto projects related to AI development and services. The list spans promising assets to consider supporting through investment or participation.
DePIN
Decentralized physical infrastructure networks (DePIN) emerged in 2023 as a crypto sector garnering significant interest for its synergies with artificial intelligence (AI). Momentum will likely accelerate in 2024 as wider audiences recognize DePIN’s strategic value at AI’s expanding frontier.
DePINs coordinate blockchain-based ecosystems for constructing and preserving physical hardware. Rather than centralized control, distributed participants provide infrastructure resources including connectivity hotspots, GPUs for processing, and data storage. In exchange for supplying infrastructure, participants may receive governance influence or network transaction fees. This helps align incentives within protocol-managed infrastructure pools.
Filecoin exemplifies crypto-incentivized peer-to-peer infrastructure, allowing participants to earn FIL tokens for providing distributed data storage services. This decentralized model aims to disrupt centralized cloud alternatives. Similar networks are emerging to supply other infrastructure resources. Render, Theta and Akash motivate users to contribute GPUs for decentralized parallel computing applications like machine learning. Similarly, Helium incentivizes growing a decentralized, peer-to-peer wireless network powered by user-deployed hotspots that earn tokens for providing coverage.
The elegance of DePIN models is enabling open permissionless infrastructure marketplaces catering to diverse verticals from media and gaming to AI, infotech, and biotech. Rather than centralized giants controlling the physical layers, DePINs allow industries to coordinate specialized infrastructure collaboratively.
As DePINs continue maturing, their future potential remains expansive. With supportive conditions, they could substantially improve infrastructure access and control distribution. But realizing this requires cooperation among stakeholders, intelligent governance, and relentless innovation to conquer impediments.
Altcoin Algorithmic Trading Opportunities
Per reports, over 1 million new tokens emerged since April, including 370,000+ on Ethereum. Coinbase’s Base layer-2 network saw extreme activity, hosting 88% of new Ethereum tokens due to its low-cost throughput. Memecoin mania appears partially responsible, driving Base’s total value locked up 630% this year per L2Beat. Solana also hosted 643,227 fresh token projects in 2024, nearly 73% or 466,914 were memecoins—many from the pump.fun minting platform. CoinMarketCap’s listings tell a similar story. Their dashboard of 500 newly added tokens over the past 30 days reveals most are additional meme coins catering to investor interest in high-risk, high-reward social tokens. CoinGecko’s recently added “memecoin” tracker highlights the sector’s massive scale—spanning over 600 assets totaling $52.7 billion market capitalization. For perspective, this comes close to 50% of USDT’s stablecoin market value.
Suffice to say, the current conditions appear opportune to target emerging altcoins, meme coins in particular, as the market builds momentum for a potential bull run. Even if a bull run does not materialize for quite some time, automated trading bots like Bitsgap can still enable you to benefit from any market trend. For example, you can employ GRID trading to profit from sideways markets, use DCA (Dollar Cost Averaging) to navigate clear trends and reduce volatility, apply BTD (Buy The Dip) strategies during downtrends, and utilize futures bots to enhance your gains (and risks) through leverage.
Despite copious criticism, Cointelegraph reported that meme-themed cryptos ranked as the top-performing narrative in early 2024. Their speculative, community-powered rallies generated massive ROI for bold investors amid broader market turbulence. I think it’d be a shame to overlook it—rather than dismissing memecoins as superficial hype trains, traders may target selective exposure, managing risk and time horizons.
Conclusion
While the sentiment in the crypto community leans towards an impending bull run, pinpointing the exact timing remains uncertain. However, this uncertainty underscores a vital aspect of the cryptocurrency markets: regardless of the direction the market takes, there are always opportunities for profit. Success in this volatile environment hinges on staying informed about the latest advancements and knowing which trading strategies and bots to fire up. From restaking to trading memecoins to investing in AI-driven projects, the key is to adapt swiftly and strategically to capitalize on the market’s developments.
