Coin Metrics: Increasing centralization in the crypto market, with the top ten altcoins accounting for approximately 82%

Wu Shuo learned that Coin Metrics published an article discussing structural changes in the cryptocurrency market. As the crypto investment sector expands, funding has become more selective. Bitcoin’s dominance continues to rise, while the growth of stablecoins and on-chain derivatives has squeezed the space for altcoins. The altcoin sector is gradually shrinking and becoming more top-heavy, with the top ten altcoins increasing their market share from about 70% over the past five years to approximately 82%. Since 2023, large-cap coins have significantly outperformed mid-cap and small-cap coins. The article analyzes whether the market is trending toward fewer, larger, and more mature assets, noting that although the market is continuously evolving, liquidity remains limited, and cryptocurrencies still need to compete with traditional assets. Despite higher barriers to attracting sustained funding for altcoins, market structure rules, the development of related ETFs, and favorable liquidity conditions could still catalyze altcoin rallies, but with more selectivity than in the past.