5 Reasons Why Crypto Stocks Are The New Altcoins

Bitcoin’s blistering rally this past year has not translated to ethereum and the altcoin casino like in past cycles. Many crypto speculators continue to hope for a rally in these high volatility assets, but much of the historic correlation has not transpired. The reason is because they are at the wrong casino!

Here’s why:

1. With BTC ETF buying leading the charge, profits cannot easily flow into products without listings on the NYSE or Nasdaq. More mainstream traders are accessing products available in their traditional brokerage accounts. As such, bitcoin and crypto proxy stocks on public exchanges are seeing pick-up in inflows.
2. More sophisticated exposure to leverage has become available through Strategy (formerly MicroStrategy), which has hoovered up tens of billions in bitcoin over the past year. Similar products have emerged elsewhere, like MetaPlanet on the Japanese Stock exchange. These firms are able to use ATM share sales, convertible bonds, and other financial structures to offer a broad range of investors, from speculators to pensions, ways to gain upside exposure that meet their criteria.
3. The advent of Pump.fun has made releasing Altcoins extremely easy. Over 7 million tokens have been made on this Solana chain coin launching site since its launch in January of 2024. With so many coins out there, it fragments altcoin capital concentration across many venues and products, resulting in lower returns. The stock market’s more stringent standards for listing mean that fewer products split the capital available.
4. A new political administration has made crypto investing mainstream. Altcoins on DEX’s helped American investors to evade regulatory requirements in the US, but the need to evade has gone down significantly. Companies like Coinbase suddenly have much lower regulatory risk than they did before January 20th. As such, investors can speculate on these products instead of seeking out esoteric altcoins.
5. Mainstream investors, the new source of crypto investment capital, do not have the technical sophistication of early adopters. As a result, they aren’t going to be downloading DeFi wallets, loading up VPNs, and swapping USDC stablecoins into Fartcoin via Jupiter’s DEX. They just want to click buy and sell on an app or a website. This technical gap is unlikely to change and favors traditional financial products.

For those looking to invest in the digital asset ecosystem, a wide menu of options now exists to do this in the public markets. First, you can trade household names like BlackRock’s iShares Bitcoin Trust ETF or Coinbase stock (NASDAQ: COIN). For added leverage (and risk), people can purchase options to increase upside or to generate income through selling these positions. The same holds true for Strategy (NASDAQ: MSTR). For fast-rising price speculation, look for newly listed tickers in international jurisdictions that intend to run the “MicroStrategy Playbook” on a bitcoin treasury. Another way to gain exposure is via bitcoin mining stocks, such as Riot Platforms (NASDAQ: RIOT) and MARA (NASDAQ: MARA). Some of these products now also offer services to AI companies, so make sure to understand the company’s corporate growth strategy before taking the plunge.

Sentiment for altcoin speculators has grown depressed. Meanwhile, mainstream products offering crypto exposure have started to bubble up on stock exchanges around the world. Many debate on whether altcoins will have their long-awaited rally or if something has changed. Unfortunately for them, the rally has occurred, just not where they were looking.