- Pablo Heman says this round’s altcoin season might be different from previous ones.
- Ether seems to be leading an altcoin bull run ahead of an anticipated bitcoin price peak.
- He has six altcoins that he says will be strong bets during the last quarter of 2021.
Pablo Heman is the pseudonym for a crypto influencer who’s gathered more than 600,000 followers on TikTok. According to his LinkedIn, he’s a former investment bank trader who now uses his social platforms to update his followers on his analysis of price action in the crypto sector.
He previously broke down how he reaches his conclusions, stating that on-chain data, the economic environment, and some technical analysis drive the bulk of his forecasts. His early posts and videos were primarily focused on bitcoin’s price action, but more recently, he’s turned his focus to altcoins.
Traditionally, bitcoin has dominated the crypto sector. Whenever bitcoin’s price peaks, investors see a bull run in altcoins shortly after and vice versa. But this time, it looks like ethereum, the largest altcoin by market cap and second-ranked to bitcoin, is taking the lead, says Heman.
Altcoins are beginning to reach new highs, a trend that Heman says may mean we are already in altcoin season, well ahead of a bitcoin price peak.
“I’ve never seen it like this before,” Heman said. “I’ve never seen the alts, led by ETH, be so eager to run in front of bitcoin.”
But some experts are cautioning that the altcoin rally is unsustainable. JPMorgan strategist Nikolaos Panigirtzoglou, for example, said in a recent note that a "big question mark" remained over whether the traffic in networks like cardano, binance, and solana will justify their valuations.
For Heman, this new frontier is reminiscent of a similar transition that took place around 2005, when the Nasdaq and S&P 500 flipped the Dow and began to lead the stock market. Right now, blockchains like Ethereum and Solana are bringing many new things to the table, like smart contracts that enable NFT transactions and DeFi, all of which have nothing to do with bitcoin.
Even institutional investors who were very conservative and stuck to ethereum or bitcoin are now beginning to understand the various use cases these blockchains bring to the table, Heman says.
This might mean that soon, ether may flip bitcoin in market cap, Heman says. It has some catching-up to do, though: as of Friday, bitcoin's market cap was $890.66 billion, while ethereum's was $400.65 billion according to CoinMarketCap. At ether's current supply, its price would need to more than double to around $7,575.
In terms of trading volume, there have been moments when ethereum has already flipped bitcoin, he adds. This means that other cryptocurrencies can do the same in the future.
"The front runner, the leader can change all the time. And that's what drives innovation," Heman said.
He argues that you won't hear this from bitcoin maximalists because they got lucky and bought bitcoin at a low price. And now, they just want to spread this perpetual myth that bitcoin is a sacred thing that's never going to get overtaken, Heman says.
But it doesn't mean that bitcoin's impact is nullified. Heman says if bitcoin drops by 20% or 30%, it can still drag the altcoins down with it; bitcoin and various altcoins fell sharply on Monday amid market-wide volatility. And bitcoin remains a store of value that is equivalent to gold because people believe in it.
Q4's potential market trends
Even though bitcoin is trading just below $50,000, it may touch the low $40,000s before it traces to year-end highs, like previous cycles. If it drops to $41,000 or $42,000, Heman says it will drag down the altcoins, and that would be a good time for investors to dollar-cost average into strong altcoins.
Two altcoins he says investors should have their eye on for this bull run are solana (SOL) and terra (LUNA). Both are rising in popularity this month and have already experienced new highs. He told Insider he recommended both of the coins to his Discord followers at the end of July and they have done pretty well so far.
Terra is about to undergo an upgrade known as Columbus-5, with tentative dates set throughout September, which will improve token swapping and burn tokens, similar to ethereum's EIP-155 upgrade.
Solana can compete with ethereum but on a faster and cheaper scale. Heman was surprised that it had not increased more in price during previous bull runs on altcoins. But as developers and users begin to adapt it for NFTs and DeFi, the crypto's price is beginning to rapidly pick up pace.
Hedera Hashgraph (HBAR) is a distributed ledger. Its crypto is HBAR and it's up 73% since the beginning of September. It's similar to proton (XPR) in the sense that it's gaining institutional attention. The governing council currently includes the London School of Economics. Heman likes it because it tries to bridge the old traditional banking world to the blockchain world, making it easier to adopt.
Chainlink (LINK) is another altcoin he's betting on and says it's one of the better oracles that links real-world data to on-chain data.
"So for example, if interest rates moved and then you have to relay that information onto the blockchain and create an options trading instrument or a futures contract on the blockchain, then you need something like that," Heman said.
Heman says LINK's price hasn't yet reached its previous highs during this bull run, and that's a good thing because it means there's room to grow. It also has a strong use case, so if there's a pullback, it would see less of a drop, making it a safer bet.
Quant (QNT) is another strong project, Heman says. It's based on distributed ledger technology (DLT) that creates interoperability between different distributed ledgers and legacy databases. It leans more toward serving enterprise rather than individual users. Heman says it was one of the few coins that has defied bitcoin's downward trend. Instead, its price has steadily grown over the last four months.
Finally, he adds Kava.io (KAVA) to the list because it's a decentralized platform that can bypass the existing banking system to provide the ability to borrow or lend cryptocurrencies. It provides USDX, a stablecoin, in exchange for collateral cryptos like BTC, XRP, and BNB.
Heman says he's currently holding SOL, LINK, and HBAR in his portfolio. As for the remaining cryptos, he's waiting for a price drop to buy in.