Cryptocurrency analysts say that the high risk, high return theory may now be shifting towards more risk as the possibility of making big gains in altcoins is decreasing. This situation is not just about technical indicators, but also reflects the psychology of the market.

“While there are tactical opportunities, the era of 100x returns may be over,” Markus Thielen, head of research at 10x Research, told Cointelegraph. This statement implies that the excessive optimism and quick-rich dreams of investors seen in the first waves of the cryptocurrency market have diminished.

But the concerns are not limited to this. Although the crypto market expects an altcoin bull run in 2024, “retail investor participation is still stagnant and few new projects have emerged that attract crypto newbies,” warns Thielen. This stagnation may indicate that the market is maturing or innovation is waning.

Thielen takes the analysis further, emphasizing that past altcoin bull markets had “special features” that attracted more money. These “features” could include factors like breakthrough technologies, revolutionary DeFi applications, or strong community movements. But he says this cycle has witnessed “tighter capital as evidenced by lower total value locked (TVL) and little venture capital investments.” This may indicate that investors are being more cautious and are turning to truly innovative projects.

However, Thielen also makes an interesting point about the narratives of the past. “Last cycle, the narrative that cryptocurrencies could replace traditional financial systems was widely adopted, but this cycle’s narratives are more short-lived and lack significant support,” he adds. This may indicate that investors are becoming more realistic about the potential of cryptocurrencies and are looking for long-term benefits rather than quick fixes.

Despite this general market skepticism, there are still some who are making exciting moves. Earlier in the week, Solana-based memecoin GameStop (GME) rose 2,727% as GameStop’s stock price surged after trader Keith Gill — who has no connection to the video game retailer — shared a meme from his “Roaring Kitty” account for the first time in almost three years . This event shows that there is still room for speculation in the market and sudden profit opportunities may arise. However, such situations are exceptions and may not be safe for long-term strategies.

Some investors, such as Michael van de Poppe, still believe in the potential of altcoins and continue to take risks. In a post dated May 16, van de Poppe, founder of MN trading consultancy, claimed that a portfolio holding predominantly altcoins poses a “relatively very large” risk, but notes that he recently sold all his Bitcoins and switched to altcoins. In fact, he claims that “you could lose 50-80% of your investment.” This move reveals van de Poppe’s strong belief that altcoins will provide high returns in the long term. But this is also a high-risk strategy.

But not everyone agrees with van de Poppe. Crypto investor Fabio Andreatta doubts that “there will even be an altcoin season.” “All you did was increase the risk,” Andreatta says in response to van de Poppe’s post. “You are very unlikely to surpass Bitcoin. Most altcoins will never reach their ATH again.