Congratulations! You are still early for the 2024–2025 altcoin bull rush that will form in the coming months. There's almost too much positive news for crypto right now, yet the positive sentiment is mainly recognized by those already in crypto. I'd be surprised if 25% of the people who aren't focused on crypto even know that an Ethereum ETF is approved. In other words, there are still a lot of profits coming from altcoins. 

But do not fret. I've sifted through dozens (potentially hundreds) of projects and narrowed down a few I am highly convinced of. How high is my conviction? I've allocated a decent share of my portfolio to these picks and would continue buying more if the prices dip. 

First, I will discuss why it's so important to be choosy this cycle. Then, I will share my three high-conviction altcoins and why I like each project. Finally, please join the conversation and share your high-conviction picks in the comments. 

So let's get started. 

The new challenge we are facing this cycle 

In past cycles, we could invest in virtually any memecoin, which would blast higher when the market pumped. The altcoin market was (compared to today) so small and valued at such low levels that any project could make thousands of percent in return if it got a little attention. 

Unfortunately, I fear we won't be able to be so indiscriminate in this bull market. Here are a few reasons why we need to be more focused on where we allocate our speculative funds in altcoins in this bull market. 

In the last bull, the altcoin options were primarily DeFi, gaming/metaverse, memecoins, and Layer 1s. Now we have new categories such as AI, DePin, Real World Assets (RWA), Layer 2s, Layer 0s, Liquid Staking Tokens (LSTs), Restaking platforms, and SocialFi. 

In the last bull, there was a much smaller pool of viable options in each sub-category. For example, if you wanted exposure to lending, you bought Aave or Venus. If you wanted to invest in Dexes, you could own Uniswap and PancakeSwap. Today, over 50 Layer 1's and hundreds of memecoins and AI coins are competing for investing dollars. 

The VCs, Developers, and early investors are greedier. Many projects are launching at much higher valuations than their seed funding. Even worse, they are hitting the market with low circulation. Early retail gets dumped on by the VCs who bought at lower valuations, and our tokens get diluted. 

The Airdrop Points system is a sham. Platforms attract mercenary capital who farm for points. Smaller investors can't compete with larger investors and get enough points to justify the risk of earning points. Once the airdrop occurs, everyone flees the chain (no more points) and dumps the token. 

The side effect of these issues is that a few coins have pumped so far, and it's hard to instill confidence in where to invest. Should we invest in memecoins and AI that have done well or focus on gaming and L2s that have done virtually nothing? Does it make sense to hold or buy projects with 80%+ of its supply still waiting to be added to the market? The more decisions we have, the harder it is to decide. 

How do we decide where to invest in Altcoins? 

Unfortunately, the correct answer to this question will be answered when the next bear market begins. There is no way to know because the variables for altcoin investing have changed so much. 

I could realistically identify 100 investable coins and create a narrative about how they can outperform the market. But I want to avoid watching, owning, and managing 100 coins. Or, I can buy and hold BTC, ETH, and SOL and ride the entire crypto market higher. However, these don't offer the potential upside that altcoins provide. 

I've given some thought to this problem. Here are my conclusions: 

I don't want to invest small amounts in dozens of coins. Of course, I will allocate some of my portfolio to absolute shitcoins. But I want high-conviction picks that will outperform BTC, ETH, and SOL moving forward. 

I want these three projects to be new coins that have yet to experience a bull cycle. Newer coins can experience price discovery and more easily become overvalued. Additionally, long-time bagholders won't be looking to dump their coins at breakeven. 

The projects all need to have the hype behind them. When they arrive, why would retail be drawn to these coins? These are the people I want to sell my coins to at much higher prices. 

It needs to have a circulating market cap of at least $1B. I am uncomfortable investing a large amount in a project with a low valuation. The higher market cap means that I may not be able to get as much potential upside, but I am also protecting my downside. I don't need or expect a 100X from these coins, but a 10X can reasonably happen under the right circumstances.